IMF dulls shine on China trade goal
The economic confidence exuded by President Xi Jinping may be reassuring for NZ but it’s not without risk. When John Key questioned President Xi Jinping on whether the wheels could come off the Chinese economy as it moves towards a free market, Xi responded confidently. The “invisible hand” (of the market) would simply be constrained by the “visible hand” (of the Chinese Government), he told Key in Beijing a fortnight ago…
But _ as with other sectors in China _ there is always a risk that a point will be reached when China’s visible hand will dampen the market. To some degree this is under way with the consolidation of the dairy industry as Synlait’s decreased forecast indicates.
And as research from Coriolis suggests, moving up the value chain in sectors such as dairy is a difficult route for undercapitalised New Zealand companies.