China in the global financial crisis

Turning the political body into a truly modern service body must be carried out - the sooner the better. Unfortunately, these basic issues have yet to be resolved.

What is more unfortunate, this ongoing global financial crisis has meant a continuing delay of basic economic reforms. But without fundamental economic reforms, sustained and rational development will be challenging.

This aspect of the basic issues is little understood by the outside world, but it is fundamental for the healthy economic development of China in the long run. Simply put, all the positive economic development in the past three decades must be installed in a law-based modern institutional and legal system. That is something China has no way of avoiding if its sustained development is to be maintained.

Naturally, slow growth and lack of deepening reform in the Chinese economy and political system could have a considerable impact on the wider world, for China's economy and development are already an integral part of the world economic system.

All of us live in the same boat, something increasingly recognised thanks to the ongoing global financial crisis. As far as China is concerned, today's economic situation, regardless of how ugly it has become, is still manageable, for China has made vast economic progress during the past 30 years.

Above all, China has become increasingly integrated into world development and global markets. In this regard, resolving the deep-seated problems within China will serve as a significant contribution to the world. At the same time, China's sustained progress will positively affect global development, and vice-versa. Nonetheless, failure to change the body of Chinese government will cause infinitely more harm, than the most adverse impacts of the global financial crisis.

Travel: a sign of globalised world

The travel industry is a test case for global economic inter-connectedness. It has been affected by the ongoing crisis, but it remains a bright spot.

As far as China is concerned, inbound travel faces some reduction in the immediate future, but the scale of reduction will not be that significant. Why? Not to mention other things, overseas companies have already set up over 700,000 ventures inside China. So the economic connections are deep enough that inbound travel will continue to develop, though a small reduction is likely to continue within the next few months or so.

Outbound travel should also continue to grow, though again at a smaller growth rate for the immediate future. Why? Chinese people are passionate about seeing the outside world. Also, personal savings in China have reached more than $3 trillion, which offers an economic foundation for well-to-do Chinese travelers to see other nations. The strengthening yuan is also a positive factor. In 2008, more than 40 million Chinese went abroad, a dramatic change from 1978, when only 10,000 people went out of the country. This Chinese passion to see the world will continue to pick up steam.