Business Week: BiMBA: An MBA with a Heart

BiMBA Rankings:

Fortune (China): China's Most Valued Business School, 2005 and 2006

Forbes (China): China's Most Valued Part-time MBA Program, 2005 to 2007

Vlerick Ranking:

#1 in Belgium, and #10 worldwide The Economist, 2009

In the latest full-time MBA tables produced by the prestigious Economist, Vlerick Leuven Gent Management School has been ranked 10th in the world. This represents a further improvement on last year's position of 14th and maintains the momentum that has seen the school move up consistently every year from 2006.

Vlerick Leuven Gent Management School has exhibited a relentless rise up the table over the last four years that has seen it leapfrog the likes of Judge Business School at the University of Cambridge, Instituto Empresa in Madrid and New York's Leonard N. Stern School of Business.

To add to this, the School has also improved its ranking in the European full-time MBA table, going from number 6 in 2008 up to 4th position this year, just behind Spain's IESE, IMD in Switzerland and London Business School and ahead of a lot of bigger brands with consequently higher tuition fee levels.

This sustained progress clearly shows a long-term commitment on the part of Vlerick Leuven Gent Management School to offer one of the world's finest MBA programmes.

Dean Philippe Haspeslagh comments: "Whereas the Financial Times ranking emphasises salary figures, this Economist ranking focuses on the experience of students in the programme and their ability to prosper in a number of ways after graduating. Let's keep this result in perspective and conclude that, thanks to great staff, faculty and students, the Vlerick MBA has again achieved a place amongst the very top international MBA offerings."

One of the many areas where the School scored highly is what the ranking calls 'Potential to network' - the ability of students and graduates to call upon an extensive, well connected and available alumni community.

Another point of interest is the rise in international applicants to European schools and the increased presence of European establishments in the top 20 of the global table. Half are now from outside of the USA. As the #4 school in Europe, Vlerick Leuven Gent Management School is seeing record demand from around the world driven by impressive ROI, corporate partnerships and career opportunities. The class of 89 students that entered in September 2009 comprises 40 nationalities, an offering with even greater diversity than the likes of INSEAD.

Peter Rafferty, International Development Director at Vlerick Leuven Management School: "This result is a tribute to the advantages of an extremely personal yet highly diverse programme with excellent teaching, student liaison and careers services. We have a very competitive ROI due, in part, to our comparatively low tuition costs and as a result we had twice as many applications for the full time MBA this year which has led to a doubling of this year's intake. We are confident that all this will fuel even greater success in the coming years."

The vast opportunities in China's rapidly-growing economy are attracting an increasing number of young foreigners to pursue MBAs and to start businesses here in China. As Guan Xin reports, they want to be part of the world's fastest growing economy and would like to capitalize on the huge potential of the world's largest market.

Each day in Beijing, Laura comes to a children's English teaching center that she built from the ground up.  Although she was born in the UK and educated at Oxford University, it wasn't until her MBA studies here that she realized that China is where she would like to build her future. 

Laura said, "I'm happy to be in China now..."

Her business partner, Premy, is from Thailand, and also came to China for the same MBA program. After meeting each other through school, they successfully sought investment for their business plan and built their own multi-million-yuan company together.

Norasedth Thienprasiddhi, Marketing Director of Leap Int'l Child Dev'l Center, said, "China has one child policy, and income is increasing..."

Just like them, many young people now come to China, believing this is the land of opportunity, a place to build the future. It's a courageous bet, but for many, it has been a bet worth making.

Laura said, "China is a good place to do an MBA, a good place to do business..."

Thienprasiddhi said, "There is huge development potential..."

For those that want to chase start-up dreams in China, MBA programs offered by local universities are undoubtedly a quick springboard for them to enter this vast emerging market. Mark, an MBA student at Peking University, is passionate about the array of business opportunities standing before him.

Mark, MBA student in Peking University, said, "There are a lot of possibilities in Chinese market..."

Professor Yao Yang, BIMBA in Peking University, said, "More and more foreign students are coming to China for MBA education especially after the financial crisis..."

Peking University's MBA program has seen foreign students increase to 40 percent of total MBA students from just 5 percent five years ago. For them, the opportunity to exchange knowledge with classmates from around the world and to gain experience in another culture is one of the MBA program's most valuable benefits.

Thienprasiddhi said, "There are a lot to gain...networking from friendships, teachers, knowledge about financing class, business plan..."

Although the opportunities are huge, there are still a lot of challenges in doing business in this dynamic market.

Professor Yao said, "The most challenging part is to understand the Chinese economic system, during the transformation from a planned economic system, to a market economy..."

Still, with all these possibilities comes a lot of pressure.  Laura says it's harder than she originally thought to bring in customers, and Premy believes the challenge is in teaming up with more local business partners.  For Mark, the dream has just begun. But nothing seems to stop the allure of opportunity in the world's most dynamic economy holding the keys to the world's largest market.

The vast opportunities in China's rapidly-growing economy are attracting an increasing number of young foreigners to pursue MBAs and to start businesses here in China. As Guan Xin reports, they want to be part of the world's fastest growing economy and would like to capitalize on the huge potential of the world's largest market.

Each day in Beijing, Laura comes to a children's English teaching center that she built from the ground up.  Although she was born in the UK and educated at Oxford University, it wasn't until her MBA studies here that she realized that China is where she would like to build her future. 

Laura said, "I'm happy to be in China now..."

Her business partner, Premy, is from Thailand, and also came to China for the same MBA program. After meeting each other through school, they successfully sought investment for their business plan and built their own multi-million-yuan company together.

Norasedth Thienprasiddhi, Marketing Director of Leap Int'l Child Dev'l Center, said, "China has one child policy, and income is increasing..."

Just like them, many young people now come to China, believing this is the land of opportunity, a place to build the future. It's a courageous bet, but for many, it has been a bet worth making.

Laura said, "China is a good place to do an MBA, a good place to do business..."

Thienprasiddhi said, "There is huge development potential..."

For those that want to chase start-up dreams in China, MBA programs offered by local universities are undoubtedly a quick springboard for them to enter this vast emerging market. Mark, an MBA student at Peking University, is passionate about the array of business opportunities standing before him.

Mark, MBA student in Peking University, said, "There are a lot of possibilities in Chinese market..."

Professor Yao Yang, BIMBA in Peking University, said, "More and more foreign students are coming to China for MBA education especially after the financial crisis..."

Peking University's MBA program has seen foreign students increase to 40 percent of total MBA students from just 5 percent five years ago. For them, the opportunity to exchange knowledge with classmates from around the world and to gain experience in another culture is one of the MBA program's most valuable benefits.

Thienprasiddhi said, "There are a lot to gain...networking from friendships, teachers, knowledge about financing class, business plan..."

Although the opportunities are huge, there are still a lot of challenges in doing business in this dynamic market.

Professor Yao said, "The most challenging part is to understand the Chinese economic system, during the transformation from a planned economic system, to a market economy..."

Still, with all these possibilities comes a lot of pressure.  Laura says it's harder than she originally thought to bring in customers, and Premy believes the challenge is in teaming up with more local business partners.  For Mark, the dream has just begun. But nothing seems to stop the allure of opportunity in the world's most dynamic economy holding the keys to the world's largest market.

We have an exciting opportunity for a Human Resources Director based in QingPu.  This position is both Strategic in nature to determine key HR transformation needs in China, yet will also be responsive to tactical needs as the Generalist HR leader.

Clients
This position will be responsible for providing both Strategic HR leadership guidance to Group operations leaders in China while also responsive to tactical needs for generalist HR services.

Essential Functions:
This position reports directly to the Managing Director in Shanghai and dotted line to the Vice President of Human Resources.  All China Industrial Products Group HR professionals will report dotted line into this role.
• Executing Corporate HR Strategic actions, services and programs in support of the GD Strategic Plan.
• Championing and executing the HR Functional Transformation Initiatives across China.
• Provide location HR Generalist support.
• Partner with the APAC HR Regional Director to standardize HR processes and policies throughout China.
• Developing HR solutions that are cost effective, high quality, and customer focused
• Partnering with Location/Division HR leaders to deliver HR solutions to meet regional business initiatives and challenges.
• Leading China Location/Division HR staff to successfully deliver quality and cost effective HR services.
• Partnering with HR Leaders and Operational Leadership team to create effective Human Capital management solutions, develop and implement succession, employee retention and drive culture change.
• Headcount planning to support business development needs.
• Implement, administer and interpret Corporate Human Resources policies.
• Serving as a resource to all Managers in the country regarding any employee issues.
• Reviewing and approving any and all country employee terminations, salary actions, hiring, transfer and relocations – subject to corporate policies and approval processes.
• Consulting with leaders regarding any company restructuring within China.
• Insuring HR operations and employment related policies and practices are in full compliance with local and country laws and regulations.
• Developing HR process controls to ensure compliance and optimal execution for critical actions
• Recruiting efforts for the region to insure effective and legitimate selection of qualified candidates to fill positions at all levels of the organization
• The growth and development of Human Resource Professionals in China.
• Partnering with other Business Leaders in China, Germany, UK & US to create effective Human Capital management solutions and drive culture change.
• Improving Leadership Talent bench strength by partnering with senior executive business leaders to upgrade and improve their talent and to develop robust succession plans
• Ensuring adequate time frame and correctness of labor relations.
• Overseeing deployment of communication channels and fostering positive employee relationships between employees and management.
• Developing strong avoidance tactics of collective bargaining/union activity, but in locations that are unionized, forging strong relationships for effective partnerships that are aligned with the GD Way.

Requirements:
• 8+ years of experience in Human Resources management roles in China
• Complete fluency in English and Putonghua.  Strong preference to also be fluent in other languages and have excellent oral and written communication skills.
• Solid HR generalist experience with demonstrated knowledge and understanding of all aspects of Human Resources, particularly as they apply to a foreign-owned manufacturing company operating in APAC.
• Excellent interpersonal and decision making skills 
• Able to think analytically with high levels of initiative and exceptionally goal-oriented
• Proven team player with a mature and positive attitude.
• University degree in Human Resources or Business and MBA preferred.
• Comprehensive knowledge of governmental policies, labor laws and regulations in China.
• Travel within China region will be required on a frequent basis.
• Demonstrated experience driving process improvements, cost effective strategies to improve the functions value proposition, and creating a top performance culture

This is an exceptional opportunity to join a growing and extraordinarily successful business.  Please submit your detailed CV, if you are able to closely match the above-stated criteria, in MS word documents, stating your current and expected compensation package to career@bimba.edu.cn

Only short listed candidates will be notified.

Since its founding in 1948, Fluke has helped define and grow a unique technology market, providing testing and troubleshooting capabilities that have grown to mission critical status in manufacturing and service industries. Every new manufacturing plant, office, hospital, or facility built today represents another potential customer for Fluke products.

From industrial electronic installation, maintenance and service, to precision measurement and quality control, Fluke tools help keep business and industry around the globe up and running. Typical customers and users include technicians, engineers, metrologists, medical-device manufacturers, and computer network professionals — people who stake their reputations on their tools, and use tools to help extend their personal power and abilities.

Fluke has achieved the number one or number two position in every market in which it competes. The Fluke brand has a reputation for portability, ruggedness, safety, ease of use and rigid standards of quality.

A wholly owned subsidiary of Danaher Corporation (NYSE:DHR), Fluke is a multi-national corporation headquartered in Everett, Washington, USA. Manufacturing centers are located in the USA, the UK, Asia and The Netherlands. Sales and service subsidiaries are located in Europe, North America, South America, Asia and Australia. Fluke Corporation has authorized distributor and manufacturer representative channels in more than 100 countries and employs approximately 2,400 people worldwide.

Product Planning Manager_100118.doc

Business & Marketing Development Intern_2010.doc

We seek to create shareholder value by differentiating through great people and disciplined development and execution of unique business models. Our prime areas of focus are in both business banking and consumer banking. Within business banking, we focus on the Small and Medium Enterprises and Self Employed Mass Market segments. Within consumer banking, we focus on the Mass Affluent and Mass Salaried segments.

We are a wholly owned subsidiary of Temasek Holdings, an Asia investment house, headquartered in Singapore, focused on creating and maximizing long-term shareholder value as an active investor and shareholder of successful enterprises.

As at 31 March 2009, our total assets stood at S$130 billion, and our portfolio includes investments in 15 different inancial
institutions. Guided by an independent board, Temasek operates autonomously on commercial principles to maximize long-terms returns. Our total shareholder return since inception 34 years ago is more than 18% compounded annually.

We have a corporate credit rating of AAA/Aaa by Standard & Poor's and Moody's respectively.

FFH China MA 2010 campusposting_19 Jan.10_Beijing_.pdf

Application Process
All applicants must submit resume to ffhhr@fullertonchina.com , and copy to career@bimba.edu.cn when you send to . Please send it with email subject of “2010 FFH MA + School + Degree + Major+ Name (Chinese name)" before Mar. 18, 2010. Please use attachment and do not attach any photo. Your application will be considered in full and if successful, you may be invited to participate in selection process.

2.  Reporting Relationship: Reports to the Executive Office

3.  Location:China Region
 
4.  Position Overview
Under the guidance of the Executive Office shall be responsible for coordinating all requests from Wyndham to Super 8 China including the completion of all requested forms and documentation.  Shall ensure that all required documentation for Wyndham will be sent on a timely basis.  Shall oversee the Lanyon system and make sure that all applicable Request For Proposals (RFP) are submitted on time.  Shall also assist in any copywriting duties associated with internal Super 8 Hotels communications to franchisees.

5.  Direct Functional Responsibilities
-        Interact with Wyndham Asia Pacific, Wyndham in Parsippany and Wyndham Europe
-        Interacts will Franchisees in the completion of documentation required by Wyndham

6.  Job Responsibilities
-        Ensure all Lanyon information is properly loaded for each operating Super 8 property and coordinate between various departments and the properties themselves
-        Ensure that all rates and information for the Worldwide Super 8 directly is correct and submitted on time
-        Ensure that all documentation that needs to be sent to Wyndham is completed accurately and on time
-        Ensure that all Wyndham communication requiring verification and authorization from Super 8 Hotels China is approved and signed by the Executive Office
-        Assist in the copywriting duties of the internal operations newsletter to franchisee
-        Performing daily/routine tasks and activities with clearly defined objectives
-        Ensure that all pertinent information and communications with Franchised and Managed Hotels is followed up in writing

7. Experience, Skills and  Competencies
-        Native English speaker: Good command of English both at speaking and writing
-        Strong managerial competencies in technical and professional skills
-        Analytical, problem solving and follow-up abilities
-        Self-motivated, driven and dynamic working principles
-        Manage conflicts according to objective and goals
-        Focus on results and resolution to problems
-        Proficient with PC and technology system skills

REQUIREMENTS
1.      A cover letter requesting the internship, specifying the start and ending dates, and if availability is full-time (40 hours weekly) or part-time (20 hours weekly).  The minimum number of hours is 20 per week.
2.      Complete enclosed form. (APPLICATION FORM)
3.   If Intern is accepted into the internship program, he will receive an official agreement.

APPLICATION FOR INTERNSHIP 2010.doc

For application, pls send resume to career@bimba.edu.cn before Mar. 4th with subject of "Super 8 hotels".

Job description varies depending on the position and the projects he or she will be engaged in.

However The general job description for the managers are:
   Provide a comprehensive suite of services to support the Client, from finance transformation and business process improvement to merger integration, shared services to business performance management and much more
   Work with our client to optimize shareholder value and transform the finance function
   Deliver and manage a diverse team of talented Consultants while coaching them to their highest potential
   Cultivate relationships with clients and possess a strong knowledge in leveraging Deloitte methodologies
   Analyze and diagnose client business issues to develop and recommend creative solutions
   Employ a structured approach to project management to ensure complete client satisfaction and project profitability
   Develop your expertise in a specialization and your reputation as a business advisor
   Contribute to practice growth and development

We are in Consulting Service group, Strategy and Operation in Seoul, Requirement for the opening are:
   Completed MBA degree (by 2010)
   Relevant financial industry or consulting experience.
   Deep expertise in Korean financial industry.
   Additional expertise in one or more of the following areas:  Finance Transformation, Business Process Improvement, Shared Services, Merger Integration, and Business Performance Management
   Strong commitment to professional and client service excellence
   Superior verbal and written communication skills in both Korean and English.
   Proven ability to deliver the full cycle of project management accountabilities
   Experienced with project problem diagnosis, solution development, client communications, facilitation of decision making, documentation, managing client expectations and team leadership
   Experience with or interest in acquiring knowledge of the systems and technologies that support the Finance function

For application, pls send resume to career@bimba.edu.cn before March. 4th.with subject of "application for Deloitte Seoul Office".

COMPANY PROFILE

Sephora www.sephora.cn) is a world leading beauty retail chain that operates more than 1200 stores and counters in more than 24 countries. In China, Sephora has become the number one beauty- retail chain with more than 74 stores in more than 20 cities and is growing at an amazing rate. Their key strengths are:
•40 years of history and international experience that develop some of the most knowledgeable and professional team in the beauty industry
•Its visionary beauty retail concept and constant focus on innovation (e.g.: launch in 2006 of Sephora.cn, the largest and most diverse selection of beauty products of the internet in China).
•One of the most comprehensive brand portfolios in the beauty retail industry with over 200 classic and emerging brands across a broad range of product categories including skincare, color, fragrance, bath, accessory & body and hair care, in addition to Sephora own private label
•Career opportunities as part LVMH (www.lvmh.com), the world's leading luxury products group.

Today, their Training and Development Department at their China Head office (Shanghai) is expanding and creating a position of Brand Training Manager.


OBJECTIVES and RESPONSABILITIES

You will report to the Training and Development Manager for China operations and will head a team made up of Training Specialists, Chief Make-up Artist, Skin Care Training expert

Managing all brands training activities and supporting all new exclusive brands and Sephora brands portfolio, you will ultimately be responsible for creating an effective chain of communication, support and management from the first contact with the international marketing / training teams of the brands principals down to the design, development by your local development and training team of customized training programs and activities to match Sephora China retail operations’ needs.

New Exclusive Brands design and training development:
•You work closely with Category Managers to update your training organization about new launches & animation plan
•You create an effective framework to provide yourself and team with the right processes to:
o Contact new exclusive brands (US and European based) and educate them on Sephora training methodologies and guidelines
o Negotiate & track brands training resources (training materials, testers, samples…)
o Define training organization & implementation agenda
•You support your training experts in designing customized training materials and confirm for results,by integrating the “We Care! MORE” Sephora customers service procedure and standards
•You ensure “Train the Trainer” deliveries and trainers certification

Sephora Brand training
•You work closely with Sephora Brand department to update yourself and your training organization about new launches & animation plan
•You define training contents, training organization & implementation agenda

Other Brands training
•You manage all brands training support
•You prioritize brands training base on business performance
•You monitor brands training
•Ensure brands regular training communication maintain close business relationship

Advanced skin care & make up training
You work closely with your Skin Care Training expert and Chief Make Up Artist to ensure:
•The development of products’ experts base on business’s demand
•The management of the advanced skin care and make up training to products’ experts
•The evaluation of Expert BAs’ competency & certify them
•The organization of the yearly make up master competition

Optimizing of E-learning & E-testing platform
•You launch on time new exclusive brands and Sephora brands
•You design and approve web contents through School of Sephora trainers or brands
•Monitor E-learning & E-testing performance and improving it

Administration & Management
•You manage and coach your team
•Your provide reporting on training performance (overall, stores brands ones..)
•You manage cost, logistics and cooperation (training facilities, testers stock & cost…)




REQUIRED QUALIFICATIONS

Required Qualification:
•You have a minimum of 6 years of relevant experience combined with a solid network within the beauty industry, including 2 years at managerial levels with proven records of leading a small team
•You have solid knowledge and experience to work at or with Brand Principals in either Training Design and Development, Product Development and Marketing, or relevant service providers
•You have solid communication and negotiating skills in liaising with international teams (US or European Based)
•You have excellent oral and written language skills both fluent in English and Mandarin
• You have solid management and presentation skills to support several local training experts in designing high quality training programs.
•You have an interest for the beauty industry and an acumen for designing training material and programs in line with business perspectives
•Workable computer skills ( Excel, PPT)


SUM UP

Based in : shanghai / China - Shanghai
Contract type : 03/2010 / Full time permanent, / -
Functions :
 [retail store] trainer,
 [marketing] trainer,

Products :
 [beauty] all beauty products,

Business Sector :
 [distribution / retail] independant multibrand store, network / chain of wholly owned stores,

Years of experience : 5 to 10
Languages skills : mandarin (business proficient).

For application, please send resume to career@bimba.edu.cn asap.

Beijing's ongoing efforts to promote growth are infringing on people''''s economic and political rights. In order to survive, the Chinese government will have to start allowing ordinary citizens to take part in the political process.

Since China began undertaking economic reforms in 1978, its economy has grown at a rate of nearly ten percent a year, and its per-capita GDP is now twelve times greater than it was three decades ago. Many analysts attribute the country''''s economic success to its unconventional approach to economic policy -- a combination of mixed ownership, basic property rights, and heavy government intervention. Time magazine''''s former foreign editor, Joshua Cooper Ramo, has even given it a name: the Beijing consensus.

But, in fact, over the last 30 years, the Chinese economy has moved unmistakably toward the market doctrines of neoclassical economics, with an emphasis on prudent fiscal policy, economic openness, privatization, market liberalization, and the protection of private property. Beijing has been extremely cautious in maintaining a balanced budget and keeping inflation down. Purely redistributive programs have been kept to a minimum, and central government transfers have been primarily limited to infrastructure spending. The overall tax burden (measured by the ratio of tax revenue to GDP) is in the range of 20 to 25 percent. The country is the world''''s second-largest recipient of foreign direct investment, and domestically, more than 80 percent of its state-owned enterprises have been released to private hands or transformed into publicly listed companies. Since the Chinese Communist Party (CCP) lacks legitimacy in the classic democratic sense, it has been forced to seek performance-based legitimacy instead, by continuously improving the living standards of Chinese citizens. So far, this strategy has succeeded, but there are signs that it will not last because of the growing income inequality and the internal and external imbalances it has created.

The CCP''''s free-market policies have, predictably, led to major income disparities in China. The overall Gini coefficient -- a measure of economic inequality in which zero equals perfect equality and one absolute inequality -- reached 0.47 in 2008, the same level as in the United States. More disturbing, Chinese city dwellers are now earning three and a half times as much as their fellow citizens in the countryside, the highest urban-rural income gap in the world.

How, then, has the Chinese government been able to adopt the principles of neoclassical economics while still claiming Marxism as its ideological anchor? The answer is that China has for three decades been ruled by a disinterested government -- a detached, unbiased regime that takes a neutral stance when conflicts of interest arise among different social and political groups. This does not mean that Beijing has been devoid of self-interest. On the contrary, the state is often predatory toward citizens, but its predation is "identity-blind" in the sense that Beijing does not generally care about the social and political status of its chosen prey -- unlike many governments elsewhere that act to protect and enrich specific social or political groups. As a consequence, the Chinese government has been more likely than other authoritarian regimes to adopt growth-enhancing policies.

For the last 30 years, the CCP has intentionally adopted policies favoring specific groups or regions to promote reform and economic growth. It has helped that the disinterested CCP government was not permanently beholden to certain groups or regions. China''''s integration into the world economy is a case in point. At the end of the 1970s, the United States was eager to bring China into its camp as a buffer against Soviet hegemony, and China quickly grasped the opportunity. Yet that early adoption of an "open-door" policy gave rise to domestic resistance: special economic zones, such as Shenzhen, enjoyed an abundance of preferential treatments that other parts of the country envied. Moreover, the CCP''''s export-led growth model required that Beijing embrace an unbalanced development strategy that encouraged rapid growth on the country''''s east coast while neglecting the interior; today, nearly 90 percent of China''''s exports still come from the nine coastal provinces.

China''''s accession to the World Trade Organization in 2001 was also a calculated move. Before accession, it was widely believed that China would have to endure painful structural adjustment policies in many sectors in order to join the WTO. Even so, the central government actually accelerated negotiations with the organization''''s members. Despite the burdens it placed on the agriculture and retailing sectors, accession boosted China''''s exports, proving wrong those who worried about its effects. Between 2002 and 2007, Chinese exports grew by an annual rate of 29 percent, double the average rate during the 1990s.

China's astronomic growth has left it in a precarious situation, however. Other developing countries have suffered from the so-called middle-income trap -- a situation that often arises when a country''''s per-capita GDP reaches the range of $3,000 to $8,000, the economy stops growing, income inequality increases, and social conflicts erupt. China has entered this range, and the warning signs of a trap loom large.

In the last several years, government involvement in the economy has increased -- most notably with the current four-trillion-yuan ($586 billion) stimulus plan. Government investment helped China reach a GDP growth rate of nearly nine percent in 2009, which many applaud; but in the long run, it could suffocate the Chinese economy by reducing efficiency and crowding out more vibrant private investment.

The economy currently depends heavily on external demand, creating friction among major trading partners. Savings account for 52 percent of GDP, and consumption has dropped to a historic low. Whereas governments in most advanced democracies spend less than eight percent of government revenue on capital investment, this figure is close to 50 percent in China. And residential income as a share of national income is declining, making the average citizen feel poorer while the economy expands. As the Chinese people demand more than economic gains as their income increases, it will become increasingly difficult for the CCP to contain or discourage social discontent by administering the medicine of economic growth alone.

Despite its absolute power and recent track record of delivering economic growth, the CCP has still periodically faced resistance from citizens. The Tiananmen incident of April 5, 1976, the first spontaneous democratic movement in PRC history, the June 4 movement of 1989, and numerous subsequent protests proved that the Chinese people are quite willing to stage organized resistance when their needs are not met by the state. International monitoring of China''''s domestic affairs has also played an important role; now that it has emerged as a major global power, China is suddenly concerned about its legitimacy on the international stage.

The Chinese government generally tries to manage such popular discontent by providing various "pain relievers," including programs that quickly address early signs of unrest in the population, such as reemployment centers for unemployed workers, migration programs aimed at lowering regional disparities, and the recent "new countryside movement" to improve infrastructure, health care, and education in rural areas.

Those measures, however, may be too weak to discourage the emergence of powerful interest groups seeking to influence the government. Although private businesses have long recognized the importance of cultivating the government for larger profits, they are not alone. The government itself, its cronies, and state-controlled enterprises are quickly forming strong and exclusive interest groups. In a sense, local governments in China behave like corporations: unlike in advanced democracies, where one of the key mandates of the government is to redistribute income to improve the average citizen''''s welfare, local governments in China simply pursue economic gain.

More important, Beijing''''s ongoing efforts to promote GDP growth will inevitably result in infringements on people''''s economic and political rights. For example, arbitrary land acquisitions are still prevalent in some cities, the government closely monitors the Internet, labor unions are suppressed, and workers have to endure long hours and unsafe conditions. Chinese citizens will not remain silent in the face of these infringements, and their discontent will inevitably lead to periodic resistance. Before long, some form of explicit political transition that allows ordinary citizens to take part in the political process will be necessary.

The reforms carried out over the last 30 years have mostly been responses to imminent crises. Popular resistance and economic imbalances are now moving China toward another major crisis. Strong and privileged interest groups and commercialized local governments are blocking equal distribution of the benefits of economic growth throughout society, thereby rendering futile the CCP''''s strategy of trading economic growth for people''''s consent to its absolute rule.

An open and inclusive political process has generally checked the power of interest groups in advanced democracies such as the United States. Indeed, this is precisely the mandate of a disinterested government -- to balance the demands of different social groups. A more open Chinese government could still remain disinterested if the right democratic institutions were put in place to keep the most powerful groups at bay. But ultimately, there is no alternative to greater democratization if the CCP wishes to encourage economic growth and maintain social stability.

Huang Yiping
China Center for Economic Research, Peking University
(yhuang@ccer.pku.edu.cn)

Wang Xun
China Center for Economic Research, Peking University

Hua Xiuping
Research Department, China Finance 40 Forum

[Abstract] We examine determinants of inflation in China. Analyses of both year-on-year and month-on-month growth data confirm excess liquidity, output gap, housing prices and stock prices positively affecting inflation. Impulse response analyses indicate that most effects occur during the initial five months and disappear after 10 months. Effects of real interest rates and exchange rates on inflation are relatively weak. Our results suggest that output gap is as important as excess liquidity in explaining inflation trajectory. The central bank should closely monitor asset prices given their spillovers to inflation. Currently liquidity measures are still central for controlling inflation, but further liberalization of interest rates and exchange rates are critical.

Key words: China, inflation, excess liquidity, output gap and asset prices

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* The authors benefited from closed-door discussions of this subject organized by China Finance 40 Forum and appreciated insights by the participants, especially Li Fuan, Zhang Jianhua, Xie Ping, Zhong Wei, Guan Tao and Zhang Bin, among others. Tao Kunyu provided comments on the draft.

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