BizChina

When President Barack Obama arrives in China for his first official visit next week, he will find a very different nation from the one President George W. Bush first went to almost a decade ago. No longer is China a net recipient of aid. On Sunday it promised $10 billion in loans to Africa and forgave the debts of several countries. Another hundred million Chinese have been pulled out of poverty, and the nation is now the world's second-largest market for luxury items. Consumers buy $6.5 billion worth every year.

The desperation that marked the lives of many Chinese over the last century is gone. The Pew Center recently found that 86% of Chinese are happy with the direction in which the government is taking the country. My firm, the China Market Research Group, has found that 80% of Chinese under the age of 32 are confident and optimistic about their futures, despite the financial crisis, and they say they expect to spend at least 10% more in the next six months than they did in the last half year.

Chinese equities rose 2.74 percent Monday on the newly released growing monthly foreign direct investment (FDI) figures, showing investors' heartened confidence on the revival of the world's fastest-growing economy.

The benchmark Shanghai Composite Index, which covers both A and B shares, climbed 2.74 percent to 3,275.05 points. The Shenzhen Component Index added 3.28 percent to 13,699.68 points.

The amount of foreign direct investment China received climbed for the third consecutive month in October, up 5.7 percent year on year to 7.1 billion U.S. dollars, the Ministry of Commerce said here Monday.

China has channeled 497.9 billion yuan ($72.9 billion) of central investment by September for the stimulus package to shore up the economy, a senior official has said.

The figure accounted for 42.2 percent of the total amount of 1.18 trillion yuan central budget earmarked to boost the recovery, Ding Xuedong, vice minister of China's Ministry of Finance, said Friday while attending a seminar.

The government unveiled a 4-trillion-yuan stimulus package in November last year to be spent over the next two years to bolster the world's fastest-growing economy, with 1.18 trillion yuan from the central budget.

"The government has adopted an active fiscal policy to cope with the global financial crisis in the past year, which proved to be effective," Ding said.

China's fiscal expenditure grew at a faster pace of 23 percent year on year for the first 10 months this year to 4.99 trillion yuan, triple the pace of revenue growth, according to figures revealed by the ministry on Friday.

China remains a favorable destination for foreign investment amid the global economic downturn, a well-known investment banker and a major sponsor of Shanghai World Expo pavilion believe.

During his recent visit to Shanghai, Duncan L. Niederauer, CEO of NYSE Euronext hardly mentioned the phrase "financial crisis" that had been most frequently repeated among economies around the globe over the past year.

The phrase he most favored was "the international board of the Shanghai Stock Exchange (SSE)". In mid May, the Shanghai government said that it would permit foreign companies to list on the city bourse "at the right time" in a bid to accelerate the process of turning the city into an international financial center, like New York and London, by 2020.

The NYSE Euronext is working with the China Securities Regulatory Commission to discuss which is the right shape or structure for the listing, according to Niederauer.

If the idea, launch of an international board for SSE, was materialized, it would be "successful", he believed, since Renminbi, the Chinese currency, was yet to be fully convertible, and such a juncture between the Chinese and international capital markets would be necessary. Moreover, China's institutional and individual investors were financially powerful, which would ensure the prosperity of the international board, he added.

The NYSE Eorunext estimated that the SSE international board would be kicked off during next year's World Expo in Shanghai, for which the U.S. pavilion has received financial support from the world's largest stock exchange.