On April 23th, 2013, Professor Chen Zhao and Professor Lu Ming gave French entrepreneurs a lecture on China’s economy at Rm. 205 in the School of Economics. This activity is academically supported by Fudan Lab for China Development Studies (FLCDS).

Professor Chen Zhao made a speech on China’s urbanization. He first provided an overview on China’s urbanization against China’s special background: the current system did a disservice to China’s urbanization progress, like the current land system and Hukou system; the 12th Five-Year Plan underestimated the growth rate of urbanization compared with the average growth rate in the past five years; “land urbanization” grew faster than “population urbanization” in the process of urbanization, particularly in the western part of China. In light of these, Professor Chen proposed a reform of China’s urbanization in terms of Hukou system, interest rate liberalization, fiscal system, regulation of high polluting enterprises and housing market, in an effort to truly achieve the economic benefits of urbanization.

 

Professor Lu Ming addressed the source of China’s economic imbalance from the perspective of financial depression and resource misallocation.  China’s historical preference over heavy industry and protection of state owned enterprises and nationalized banks in reality caused financial depression, which went worse with Chinese government ‘s price control, leading to a series of economic imbalances: high growth rate, low employment rate, low consumption, over-investment, and unfair income distribution. All these made China an outlier in the global economy. If these were not overcome, China will face a potential risk of inflation and europeanization.

Mr de Boisséson, representative of Saint-Gobain in China, then introduced their Group’s layout and investment development in the course of 25 years in China. Mr Bailet, representative from A CAPITAL talked about their fund’s history and their mission of serving Chinese companies in their efforts to go globally to make overseas investment. He highlighted the trends and changes about Chinese companies’ overseas investment. According to the quantity of transaction, private enterprises accounted for the majority; while large sized sate-owned enterprises took a large portion when it comes to transaction amounts.

In the last session, the four speakers answered the questions raised by French entrepreneurs with respect to Hukou system, urbanization, and underestimation of interest rate.