Reflections on 2015

Cheming Yang

2015 is definitely not a good year economically. The economic growth has slowed down signicantly in China. The GDP growth is estimated to fall below 7% in 2015. I recalled that we did a cover story in the March of 2012 regarding China’s GDP fell under 8%. 8% was considered a bottom line at that time. Now, China can barely make 7%.
The situation is no better in Taiwan. Taiwan is struggling to keep its growth above 1%. Hong Kong is slightly better off with its GDP growth around 2.5%, but it also has a year on year decrease and they are still in a downward trend.
The oil price is falling and the mobile industry is also facing a stagnant growth. I have said repeatedly that we need a sound economy more than constant economic growth. Rapid aging is the future we all face around the world. The level of consumption is going to go down as people age in general. Therefore, a shrinking economy is not an abnormal phenomenon. It is actually normal and we need to embrace it with the right attitude.
When people age, sometimes we loathe to owning up to it and might take futile measures in trying to avert it. The same applies to the operation of macroeconomics. Governments might take unnecssary measures to stimulate growth in the wrong direction. As a result, we end up building or manufacturing things that we do not need.
So forget the urge to grow all the time. Instead, we need to focus on providing things that we and others need. If we worry too much about marking up the figures, our energy and resouces will be directed to invest in things that no one need. So we have ghost towns and mosquito facilities. It is not imperative to have a year on year growth. More importantly is how much output we ought to have in oder for every one to have a decent living. That might mean a delcine in GDP from the previous year. The mindset of needing constant growth has in effect turned into a poison to the heatlh of our economy. It is time for us to accept that shrinkage is the norm. What matters is whether we crank out enough for us to sustain our living, not whether we have an economic growth from the previous year.

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