Comments on: The blurry line between public and private in China http://www.eastasiaforum.org/2009/07/08/the-blurry-line-between-public-and-private-in-china/ Economics, Politics and Public Policy in East Asia and the Pacific Sun, 12 Feb 2012 22:50:38 +0000 hourly 1 http://wordpress.org/?v=3.2 By: Lincoln Funghttp://www.eastasiaforum.org/2009/07/08/the-blurry-line-between-public-and-private-in-china/comment-page-1/#comment-41225 Lincoln Fung Mon, 13 Jul 2009 11:13:45 +0000 http://www.eastasiaforum.org/?p=5587#comment-41225 Dongfu may be correct and makes a very good point. Although China is a unitary country/system, it often suffers internal market divisions by various forces. That is not good for the country, including those protected regions themselves, just like trade protections between countries. A truly unified national market will do great good to China, as well as to other trading partners. It will unleash much greater efficiency in resources allocation and enhance the national welfare. So I think centralisation is not enough in some areas in China and China will need to strengthen it. Having said that, I think China has probably made considerable progress. It may be an issue of working progress. As China is further integrated into the world market system, any internal market barriers will also be removed. Dongfu may be correct and makes a very good point. Although China is a unitary country/system, it often suffers internal market divisions by various forces. That is not good for the country, including those protected regions themselves, just like trade protections between countries.

A truly unified national market will do great good to China, as well as to other trading partners. It will unleash much greater efficiency in resources allocation and enhance the national welfare. So I think centralisation is not enough in some areas in China and China will need to strengthen it.

Having said that, I think China has probably made considerable progress. It may be an issue of working progress. As China is further integrated into the world market system, any internal market barriers will also be removed.

]]> By: Dongfuhttp://www.eastasiaforum.org/2009/07/08/the-blurry-line-between-public-and-private-in-china/comment-page-1/#comment-40153 Dongfu Wed, 08 Jul 2009 22:05:56 +0000 http://www.eastasiaforum.org/?p=5587#comment-40153 Interesting issue about “central support”, and what the nature and scope of that support is (compared with support from provincial governments). I have my own theory ….. and that is that the private Geely of Hunan (with its base in Zhejiang) was running into institutional problems which amount to (illegal) provincial protectionism and discrimination, related to problems of local authorities ignoring recent central laws promoting competition policy. Geely may have been seeking central (national) intervention to put an end to provincial narrow-mindedness and anti-competitive behaviour in terms of where auto components could be sourced and where finished vehicles could be sold (in the context of Geely’s strategic plan for expansion into other regions). Interesting issue about “central support”, and what the nature and scope of that support is (compared with support from provincial governments). I have my own theory ….. and that is that the private Geely of Hunan (with its base in Zhejiang) was running into institutional problems which amount to (illegal) provincial protectionism and discrimination, related to problems of local authorities ignoring recent central laws promoting competition policy. Geely may have been seeking central (national) intervention to put an end to provincial narrow-mindedness and anti-competitive behaviour in terms of where auto components could be sourced and where finished vehicles could be sold (in the context of Geely’s strategic plan for expansion into other regions).

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