Deutsche Bank’s Henry Cai points to a non-standard means of gauging the seriousness of growth concerns. He says new entrants to the Forbes rich list in China have been commonplace but more recently there has been less turnover, which suggests at least signs of a slowdown. "I think it is reasonable to accept the growth slowdown but it does present a challenge for the Chinese government and new leadership. However I am still cautiously optimistic about China." He says the government has invested well and China’s niche position as a manufacturing centre and regional centre is secure. "Also the central government has $3 trillion at its disposal and the ratio of national debt to GDP is very low," he says. "So the central government has big power to effect change in China."
Cai adds that another reason to be confident is the unique culture of the Chinese people. "Within the labour force, nobody feels inferiority. Everyone has equality and everyone is very ambitious. Most of my clients come from poor backgrounds – farming communities and the like. They want to change their lives and can do so. There are no nobles in China – everyone is equal."