private enterprise and demand will ensure china lives up to expectations.

India will be the next big thing and overtake China for the simple reason it is a democracy and does not shy away from capitalism which history has proven to lead to economic growth. In fact we start seeing now that India in some industries (eg IT) is starting to outstrip the developed world. They are well educated, free thinking and want to be upwardly mobile. China is going to stall unless fundamental change occurs.

The right idea, but a weak piece.

A bankrupt banking sector and a trillion dollars of bad debt will cause an economic crunch as surely as night follows day.

And as for "realist's" religious faith in the market, 80% of the economy in China is still state-owned, remember.

My belief is that should democracy ever come to pass in China it (China) will fracture politically with the resultant knock on effect that its economic growth will at the very best be severely handicapped.

The article is a very welcome reminder that a anti-democratic state like China can never become a superpower economically, militarily or culturally. For those who say otherwise dream on but you are wrong....

HISTORICALLY:

In opening up to the world, China faces many challenges steming from its history. For only about 250 years has China ruled itself. Its traditions still stiffle its progress. While China has never experienced a protracted dark ages, its very earlier achievements in technology were in artisan and unification technologies (Needham, Jin). Greek philosophy, necessary for innovation was/is absent.

BUSINESS PRACTICE

Economic journalists and writers of popular books on "How to do Business in China", make the mistake of associating the ethnics of Confucianism with Chinese business practice. Confucianism was/is more inthe domain of the scholar and the agrarian. The Shang, the artisan and merchants, were cultural outcasts. If the modern entrepreneurs are from the Shang, modern business persons stand probable snake oil salesmen foundations.

This above is evident with UWS and UTS loosing millions in dealings with Australian academics doing business with businessmen the China and Chinese Diaspora. Australian deans are fooled by private education providers on a regular basis. DEST knows it; the AVCC knows it, but do nothing. DEST and the AVCC were warned of the situation six years ago, yet did not alert the universities.

As a post-grad. student you should read S.Gordon Redding (1990 and Robert Silin (1972/6?), not just the Economist Conferences and the like.

IN FUTURE THE LOOK FOR:

Oliarchies in the big cities, and tension between these oliarachies and provincial mayors.

INSTABILITY IN PROPERT THEN BANKING MARKETS

Much property investment uses interest only loans. Inflation could destablise the property/babnking sector in HK. Albeit, China PRC is trying to buy-in West Banking expertise.

CHINA WILL BUY INTO THE US

Just as Japan did.