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China’s economy could shrink for the first time in decades because of the Coronavirus

China’s economy could shrink for the first time in decades because of the Coronavirus

By Laura He, CNN BusinessUpdated 1702 GMT (0102 HKT) March 4, 2020

Hong Kong (CNN Business) The novel coronavirus outbreak has been brutal for China and could plunge the country’s economy into its first contraction since the 1970s.

Economic activity sharply declined across the board in February as companies struggled to reopen for business or hire workers during a government-mandated shutdown, according to official and private surveys released in recent days.

Wednesday revealed shockingly lousy news for services in the world’s second-biggest economy. Chinese media group Caixin said its purchasing managers index for the sector plummeted to 26.5 last month from a reading of 51.8 the month before — the lowest figure recorded by the survey since it began in 2005. A reading below 50 indicates contraction rather than growth.

“China’s economy is in a very bad way indeed,” said Kit Juckes, a strategist at Societe Generale. That data — which mostly follows small and medium-sized companies — largely tracked with a government survey of primarily state-owned firms in the services sector released over the weekend. China’s factories also recorded their worst month on record in February, according to government and Caixin data, as companies face extended closures to contain the virus, or struggled to fill jobs because of travel restrictions.

“The virus outbreak has put the government into a difficult situation,” said Raymond Yeung, chief economist for Greater China at ANZ. “On one hand, the lockdown policy is the most effective way to contain virus spreading out. On the other hand, the health measures are hindering economic activity.”

The gloomy picture painted by the data is reinforced by evidence from coming from big companies. The world’s biggest brewer, ABInBev (BUD), said it had lost $285 million in revenue in January and February in China, while iPhone maker Foxconn (HNHPF) said Tuesday it didn’t expect production to return to normal until the end of March.

The fallout could be crippling for China’s economic growth this quarter. Macquarie Group chief China economist Larry Hu suggested that the country could be in for a historic economic decline.

The data “suggest that things are really bad and the government is willing to report that,” Hu wrote in a note after the official data was released at the weekend, adding that growth for the first quarter could come in well below estimates currently running at around 4% (down from 6% in the fourth quarter of 2019).

“It’s even possible that the government will report negative growth for [the first quarter], the first time since the end of Culture Revolution,” he added.

China’s economy contracted 1.6% in 1976, when Communist Party leader Mao Zedong’s death ended a decade-long period of social and political tumult in the country. Since then, China has boomed, growing at an average annual rate of 9.4% between 1978 and 2018 as it embarked on a series of economic reforms.

Hu wrote that China will likely enact more policy measures to help the economy, but added that it’s too early to expect a big stimulus package from Beijing.

UBS economists also suspect that China’s economy contracted in January and February, noting the poor PMI data in a Tuesday research note.

“The next two weeks will be critical to track the path of new confirmed cases of coronavirus and the pace of economic normalization,” wrote Ning Zhang and Tao Wang, economists for UBS.

Bad news for jobs

The recent data suggest that Beijing’s efforts to shore up employment this year are in jeopardy. China’s services sector represents about 360 million jobs and accounts for 46% of the labor market, making it the largest source of employment in the country.

Government authorities have been pushing hard to keep unemployment low, wary of the fallout that could happen otherwise. Chinese Premier Li Keqiang said last month that officials are “closely watching the employment issue and will try to prevent massive layoffs.”

He also said stabilizing employment is the government’s primary task, and placed special emphasis on new graduates and migrant workers. China’s 290 million migrant workers are among those most exposed to a slump, since they often travel from rural areas to the cities to take on construction, manufacturing, or service jobs that would have been tough to find during last month’s widespread shutdowns.

Only 80 million migrant workers had returned to work by mid-February, according to the government.

In recent days, Beijing has also urged college students to join the army and ordered all public colleges to expand their advanced degree programs — efforts meant to reduce the number of job seekers.

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China’s Economy Could Shrink For the First Time in Decades Because Of the Coronavirus

The article China’s Economy could shrink for the First Time in Decades Because Of the Coronavirus by Laura He discusses the economic recession state of China due to the spread of the Coronavirus. China is the second-largest economy in the world. China’s industrial progress could shrink progressively with the rampant spread of the Coronavirus leading to a drop in the stock market and higher unemployment rates. It is evident through the hardships Chinese firms face to reopen for business or hire workers after the government-mandated shut down in February as a measured policy to contain the virus. In micro-economics, an economic recession happens when the economy is on a downward spiral for two quarters in a row. A drop in revenues generated by large and medium-sized business organizations in China indicates that the Coronavirus has led to a contraction of China’s economy. Various global organizations operating in the country have reported a drop in their revenues where ABInBev (BUD) lost $285million, whereas Apple maker Foxconn expected its production to decline until the end of March (He, 2020). The country experienced its last economic contraction in the 1970s. It is a clear indication that the virus has seen most of the country’s economic activities shutting down due to extended measures to contain the virus or inability to fill in the job vacancies due to travel restrictions.

Coronavirus jeopardizes China’s combined efforts to contain unemployment. The virus has led to unstable employment levels in the country, with the government straining to create job vacancies for new graduates and migrant workers. During the shutdown, the workers face barriers of moving from rural to urban centers in search of construction, manufacturing, or service jobs. Out of the 290 million migrant workers, only 80 million have returned to work in February (He, 2020). The government has urged students to join the army as a measure to curb the unemployment rates in the country.

Work Cited

He, Laura. China’s economy could shrink for the first time in decades because of the Coronavirus. CNN Business, 4th March, 2020. Retrieved from https://edition.cnn.com/2020/03/04/economy/china-services-employment-coronavirus/index.html

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China’s Transition from the Mao Era to Neoliberal Post-Mao Market Reforms

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China’s Transition from the Mao Era to Neoliberal Post-Mao Market Reforms

A lot has been said about China and how it transitioned from the Mao era to a neoliberal post-Mao market economy. Evidently, China begun the transition to a market economy from the late 1970s and in the early 1980s using a systematic approach to its major industries including the agricultural sector, opening up itself to foreign investments, and allowing entrepreneurs to conduct businesses. Previously, Mao had instituted a socialist education campaign and in 1966 formed a cultural revolution aimed at removing counter-revolutionary aspects in the Chinese society. In a movement that lasted 10 years, Mao saw China descend into class struggles, unprecedented elevation, and widespread destruction of various cultural artifacts unique to China. Mao’s agenda was to preserve communism in China through a process of purging capitalist remnants and all traditional aspects for the society. Due to the radicalness of the Mao era, its abrupt end and the transition to a neoliberal market reform afterwards is quite remarkable. Notably, the most compelling elements identifiable in China’s transition from the Mao era to neoliberal post-Mao market reforms include economics as a key to the country’s agenda, reduction of trade barriers, partially free market conditions, and the partial control and deregulation of the capital markets.

One of the key hallmarks of China’s transition from the Mao era to neoliberal post-Mao market reforms was the reversal of some policies made under the Mao era. Ping highlights how the movement from socialization to privatization of housing and other property markets in a reversed policymaking period reflected development ideology in the post-Mao period (6). As a mark of neoliberal politics and thinking, the housing sector was prioritized in the economy driven new approach that has seen China rise ever since to its current status. Today, expansive economy driven policies have seen urbanization account for a majority of China’s success in the post-Mao era (The Guardian 1). These developments are clear indications of a change in policy, one that would not have been possible in a nationalized Mao-era government. At present, powerful national identity and the strong sense of social purpose, as identified by Meisner (413), have been replaced by a country focused on an economy-driven political ideology, one that focuses on an overall welfare of its society through enabling entrepreneurs to drive the economy, removing barriers, and protecting domestic industries from external rivalry that is harmful. Yet, in the current post-Mao market reform era, the government has retained some level of control not evident in countries in the same economic development level as China.

While it is easy to focus only on the economic development of the country following the end of the Mao-driven reforms, it is important to also note that the post-Mao Chinese state play a vital role in governing and regulating people’s everyday life. Yu presents a case of how girls in the traditional Chinese society were forced to bind their feet in order to marry city elites, in a display of a Chinese culture that was very unequal, influenced largely by the Qing Dynasty in the early 20th century (1). Here, the influence of the reigning political class shows how policies affect the daily lives of the people in China. The post-Mao Chinese state has similar effects, albeit not as extreme as the foot-binding girls, but all the same noteworthy as the activities and policies held by the government controls and regulates how people interact with others through business, social, political, ideological, and in economic realms. At present, the post-Mao Chinese state offers freedom in relation to entrepreneurship, a phenomenon that has created jobs for various industries, improved the livelihood of the people, led to a rise in middle class status for a majority of the citizens, and seen an unprecedented wave of internal rural-urban migration. According to Miller (1), migration in China, titled Farm to City, is the story of the movement from the Mao era to a more liberal post-Mao period that has seen the lives of many people transformed. Urbanization, largely due to government interventions and policies, has led to better health care, overall improvement in education and its quality, opening up of more rural economies, and an overall better employment opportunity. While some problems exist, including unemployment and overpopulation in some cities, and the problem of a middle-class economy, the role of the post-Mao Chinese state has been one that has facilitated positive change to improve the everyday lives of the Chinese people. Therefore, through its efforts to improve the economy, the post-Mao Chinese state has enabled better outcomes for people, even where poverty, joblessness, increased migration, and a rising middle class exist.

The role that the government has played in governing and regulating the everyday lives of the Chinese people has been converted into rapid urbanization and the formation of a middle class xiaokang society. Ping is conscious of the problems and limitations that have risen in China due to the rapid urbanization of the country including changing patterns of human activities, social structural changes, and migration (7). In China today, rapid urbanization and building a middle-class xiaokang society have given rise to high population density especially in the cities, a lack of affordable housing, poverty, inadequate infrastructure in some regions of the country, pollution, crime, creation of slum dwellings especially for those migrating into the cities, and congestion. Meisner’s view of the concept of cultural revolution also points to a change in culture where Chinese people are gradually adopting capitalist ideologies in various critical sectors and in the act of building and maintain a vibrant middle-class society (293). Overall, the problems and limitations of China’s rapid urbanization and building a middle-class xiaokang society continue to expand as the nation rises in terms of economic development, social structures, and the adoption of more economy-driven political ideologies.

Due to the rapid urbanization and the rise of a budding middle-class society, China has progressed unevenly. This has meant that the nation has seen many people move from the countryside to the urban dwellings in the cities in search of greener pastures. The effect has meant that migrant workers have increased significantly, a condition that Miller has expressed to be a disaster in waiting as the country expands in ways that even the government has not been able to control (3). Migrant workers earn better than those that stay behind in farms and the twin processes of industrialization and urbanization mean that the national Chinese economy is able to provide jobs, even at minimum pay, for migrant workers (Miller 3). However, life for these workers is uncomfortable insecure, and unfair. While the economic rewards are better than the life in the countryside, mass migration means that housing and other critical components of human living are critically inadequate. The plight and struggles of the migrant workers will continue in the next several years as mass migration continues to happen amidst an expanding Chinese economy.

In conclusion, China’s transition from the Mao era to neoliberal post-Mao market reforms has meant rapid development, industrialization, and urbanization. While positive elements exist, including a better overall living condition and more wealth distribution in the country, it has also meant that a majority of people have been affected. While the government struggles to provide the best living conditions for all its citizenry, some elements cannot be controlled. For example, migration into the cities have meant poor conditions and insecurity for migrant workers. Nonetheless, the transition from the Mao era to neoliberal post-Mao market reforms has been a positive era for China, one that has seen it rise to global status.

Works Cited

Meisner, Maurice, and Matthias Meisner. Mao’s China and after: A history of the People’s

Republic. Simon and Schuster, 1999.

Miller, Tom. China’s urban billion: the story behind the biggest migration in human history. Zed

Books Ltd., 2012.

Ping, Lei. “Demolition of a Distinctive Chinese Habitus: Controversies of Urban Sustainability

in Shanghai.” Environment: Science and Policy for Sustainable Development 61.6 (2019): 4-17.

The Guardian. “Chinese construction firm erects 57_storey skyscraper in 19 days: Company

claims to be world’s fastest builder after assembling Mini Sky City at a pace of three floors a day.” The Guardian. 30 April 2015: Web.

Yu, Kongjian. “Beautiful big feet: Toward a new landscape aesthetic.” Harvard Design

Magazine, Fall/Winter 10 (2009).

My favorite movie of all time is the Matrix

Matrix

My favorite movie of all time is the Matrix. The Matrix is a visually dazzling cyber-adventure, full of kinetic excitement. It is not only an action packed film with a variety of special effects, but it also has an amazingly interesting story line to it. The Matrix has the conventional conflict of good conquering over evil. The Matrix involves an evil computer world with accompanying bad guys controlling the real world versus the good in the human spirit. The good triumphs over evil keeping the film morally correct. The movie “The Matrix“ brought an exciting new technology, never before used, to the cinema screen. The scene I am talking about is the action where an agent from the evil world is firing a conventional weapon upon Neo, the main character.

This scene is when Neo and Trinity go to save Morpheus, whom agents are holding. An agent shoots bullets at Neo, at which time the filming becomes slow motion as he bends backward 90 degrees and dodges every bullet coming at him, with the camera moving in a complete circle around the two opponents. The bullets are shown as rippling waves through the air, with a clear view of the bullet as it splits the air. As the camera moves in a counter clockwise motion, you see the characters and action change from viewing it in one direction to coming straight at the audience, before slowly moving away again. This scene length was close to one minute in which movie filming was changed from the realistic to the fantasy. The technology of the 360-degree camera shot was spectacularly introduced to the general movie going public. The camera was rotating around the character, Neo, in a 360-degree pattern while showing the bullets fly past him on all sides as the camera moved to show his front, side, back, side views. A music score without dialog kept the scene a visual experience. This technology lead to a whole new standard of filming for movies.

When I saw this scene in the movie theaters, I was astounded by the miraculous event that just took place. The audience was in utter shock, everyone was whispering to each other about what they just saw. I have never seen anything in the movies that could even resemble the sequence in the movie. The scene only lasted a few moments, but that image stuck in your head like a rewinding video.

Many kinds of movies, ranging from comedy to action, are now using the 360- degree viewing to enhance scenes and raise the levels of filming to adjust to the technology of the current times. This type of filming has generated a wide variety of uses. The first mimic, of course, was other movies. The movie Deuce Bigalow Male Gigilow had a scene where a character did the same scene as Neo in the Matrix, but was intended to make fun of it. This filming technique was even used in a more current film that came out, Swordfish. The opening scene where the girl is forced outside the bank with an explosive vest on her used this technology. When she blew up it showed the explosion in a 360-degree turn like the Matrix, but instead of a two character shot, this scene involved a slow motion view of the entire street area reacting to the impact of the explosion.

Graphic artists are using the 360-degree view for developing new building construction, landscaping, architectural development, and advertising. This type of filming has quickly become a standard for high tech projects involving new products, medical diagnoses, vehicle accidents, and law enforcement. The 360 view has been employed to recreate disasters, military maneuvers, and natural phenomenon to study and learn ways to protect the public, or to prevent future disasters.

The technology was in existence but this was the first time a movie had the chance to use it in a major film. The action packed science fiction of the Matrix made it possible to use this technology. The Matrix was the first movie that had the budget and foresight to incorporate this technology effectively. This technology became possible due to the advances in the computer industry in the last ten years. Without the many people involved in developing new programs, this type of technology would not be a reality at this time.

The best part about the Matrix is that it took place in the present and the story could be true about us, without our knowledge. Our society has made such tremendous advances in the computer era in the last decade, that few people know the extent and scope computers play in our daily lives. The human imagination has the capacity to dream up ways that computers affect our lives that sound more like science fiction than reality. That this movie could in fact be telling the world a true fact is not beyond the general public’s imagination. Initially, a person would deny that computers could be so advanced as to take over the human population, but subconsciously, there may be a small doubt that maybe, just maybe, it could possibly be true. People have been bombarded in the last few years with stories, real or imagined, of computers doing what was totally unthinkable to the last generation. With the knowledge that the general population knows so little about the high tech end of computer science, it is not beyond the realm of possibility that the individual would begin to doubt that what his eyes see is in truth reality. The story was so intriguing that when people were exiting the movie, they were talking about how that concept could be true right now. During the scene when Neo dodged those bullets, everyone was in utter amazement. All the people in the audience were whispering to their companions about the event that just took place.

The artifact derived when Neo and Trinity went to save their companion. They were on top of the police building when an agent showed up, leaving only Neo, Trinity and the agent. It was an ideal time to show that Neo could move like an agent and begin to surpass his friends. The movie was starting to come to a conclusion, and there needed to be some recognition of Neo being the one (the one with the ability to remake the Matrix as he sees fit). The scene or rather the artifact showed the first step of Neo becoming the one. It was very significant since the first step to becoming the one is to match the agent’s skills and soon surpass them. Another significant part of the scene was that Trinity was there to witness it. Later in the movie it tells you that it was her destiny to fall in love with the one. Since Trinity was there to witness the event, it gave insight to her eventually realizing that he was the one. She learned that her feelings towards Neo were actually feelings of love. It showed the public that even with our lives depending on computers, either in the movies or in reality, that the human emotion of love is still an extremely powerful aspect of every life. I have come to realize that that scene not only played an important part in the movie, but also gave the first bit of insight into what Neo was to become.

The Matrix has become a big part of our pop culture because of the innovative film techniques used to make it a milestone for all other action movies. The 360-degree, slow motion scenes were filmed with such outstanding results; it set a standard for future movies to adhere to. This technology was quickly employed by a wide variety of graphic designers from a variety of professions, including construction and medical. The majority used it to display views for the improved understanding of how a product was perceived. The advances in this type of filming were welcomed by the general public as a superior visual component that would enhance their viewing. It has opened a door to the future where three dimensional viewing and filming c will only improve our way of life.

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