Asia's dance of the twin elephants
All roads lead to China and India. Whether one is talking to policymakers gathered in Davos or to business leaders scattered around the globe, the conversation inevitably turns to the spectacular growth of China and India - the elephants in the room, or at least the boardroom. Perhaps not surprisingly, most observers divide into two camps: sceptics who expect the two nations to stumble after so many years of rapid growth; and doomsayers who think China and India will suffocate the developed west.
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I disagree with both schools of thought. First, I will address the sceptics. I think that, if anything, the China-India story is under-blown. The numbers show the huge potential for spending on middle-class goods and infrastructure. China, a nation of 1.3bn people, bought just 5m cars in 2004, according to The Economist. France, a nation less than one-twentieth the size in population, purchased half that.
In all, China and India are expected to spend more than $2,000bn on infrastructure in the next 15 years, on everything from roads to airports to dams. The opportunity is even greater than most realise.
Of course, it is true that China and India face enormous challenges if they are to live up to their promise. Under-employment, limited infrastructure, constraints from natural resources, environmental concerns, over-regulation and underdeveloped banking systems are just some of the factors that have the potential to derail the opportunity for growth. China's one-child policy, for example, has created one of the most rapidly ageing populations in the world - a massive fiscal problem when it comes to funding its social welfare programmes.
Another challenge is to stimulate domestic spending. While growth in China has averaged more than 9 per cent in the past 25 years, that has largely been on the back of booming exports. Rising foreign demand will not sustain China's economy for ever, especially if US consumer spending drops off. As for India, its combined state and federal budget deficit is about 9 per cent of gross domestic product and its foreign direct investment is barely one-tenth of China's.
In spite of the challenges and the sceptics, I remain bullish on China and India. While the hurdles they face may trip them up temporarily, the secular growth trend of these emerging economies is clear. Spend even a little time in these nations and you cannot help but be struck by the wondrous sense of opportunity among the people. That is the fuel of their expansion over the next 50 years.
Now for the doomsayers, who view the ascendancy of China and India as a threat to the west. This vision seems blurred by a sense of entitlement.Entitlement is an insidious disease that weakens even the strongest economies and sows the seeds of uncompetitiveness.
The feeling of entitlement concerns not only pensions and healthcare but also employment - and to being paid for long periods even when not in work. In the US motor industry, restrictive labour contracts and lacklustre offerings have wiped out thousands of jobs and billions of dollars of shareholder wealth. History shows that for individuals, for businesses and for nations, feelings of entitlement lead to stagnation and protectionism and eventually erode the primacy that first made the entitlement possible.
Encouragingly, some western leaders have recently taken on this issue directly. Last month George W. Bush, US president, in his State of the Union speech, called protectionism a form of "economic retreat". Also last month, at the World Economic Forum in Davos, Angela Merkel, the German chancellor, called on the European Union to tear down trade barriers. She characterised the World Trade Organisation's progress in establishing freer trade as "slight". Germany, she said, must reduce regulations and make workers less reliant on the government for jobs. Loud applause greeted her remarks.
In the same spirit, rather than fear the advancements of China and India, we must celebrate them. The development of these elephantine economies is likely to lead to greater freedom, democracy and stability in the world, and make for stronger global growth. (Imagine the dangerous alternative of another 2.4bn people with no economic future.) Yes, we must be sensitive to the plight of individuals caught out by these global transitions. But if we, as developed nations, are to avoid our own decline, and indeed capitalise on the opportunities in the emerging markets, we must remember the catalysts of our own success - education, innovation, self-reliance and open markets. And we must resist the siren song of entitlement and protectionism.
The writer is chief executive of Citigroup Global Wealth Management (The Citigroup Private Bank, Smith Barney and Citigroup Investment Research).
中印崛起不会威胁西方
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条道路通中印。无论是与聚集在达沃斯(Davos)的各国政要交谈，还是与世界各地的商业领袖交谈，话题总是不可避免地转到中印两国惊人的经济增长上――这两国就犹如房间里的巨象，至少在董事会会议室里是。也许并不令人感到意外的是，大多数观察家分为两个阵营：怀疑论者和灾难论者，前者预期两国在快速增长多年后会一头栽倒，后者则认为中印将压制西方发达国家。
这两种想法我都不赞成。我首先要反驳怀疑论者。我认为，更可能的情况是，中印的发展远未达到鼎盛时期。数据显示，中产阶级商品消费和基础设施开支都存在巨大潜力。据《经济学人》(Economist)报道，拥有13亿人口的中国，2004年仅购买了500万辆汽车，法国的人口规模不到中国的二十分之一，汽车购买量却是中国的一半。
预计在今后15年，中印两国的基础设施支出总和将超过2万亿美元，包括公路、机场、水坝等不一而足。机会甚至比大多数人想象的还要大。
当然，中印两国若要兑现它们的诺言，确实面临着巨大的挑战。就业不足、基础设施有限、自然资源的各种约束、环境忧患、过度监管和欠完善的银行系统，这些不过是有可能阻挠增长机会的部分因素。例如，中国的独生子女政策，使之成了世界上人口老龄化最迅速的国家之一，在为社会福利事业筹措资金方面，这就成了巨大的财政问题。
另一项挑战是刺激国内消费。过去25年，中国经济增长平均超过9%，这在很大程度上是依靠繁荣的出口。外国需求的增长无法永远支撑中国经济，尤其是美国消费者支出一旦减少，情况更是如此。至于印度，各邦与联邦预算赤字加起来，占国内生产总值(GDP)的约9%，而外国直接投资仅为中国的十分之一。
尽管存在这些挑战和怀疑论调，我仍看好中国和印度。虽然它们面临的障碍可能令它们暂时受挫，但这些新兴经济体的长期增长趋势是显而易见的。在这些国家待上哪怕一小段时间，你就不能不被人们善于捕捉机会的、了不起的头脑所打动。这正是它们今后50年的增长动力。
现在让我来反驳灾难论者。他们认为中印两国地位的上升是对西方国家的威胁。这种看法似乎被一种特权感所蒙蔽了。特权感是一种暗疾，即便最强大的经济体也会被削弱，它还会播下竞争力低下的种子。
这种特权感不仅涉及养老金和医疗保健，而且还涉及就业――即使不工作仍然长期领取报酬。在美国的汽车制造业，限制性的劳动合同和缺乏吸引力的薪酬，已丧失了数千工作岗位，并使股东数十亿美元的财富蒸发。历史表明，对个人、企业和国家而言，特权感会导致发展停滞和贸易保护主义，并最终侵蚀最初让特权感得以形成的优越地位。
令人鼓舞的是，部分西方领导人最近已直接指出这一问题。上月，美国总统乔治?W?布什(George W. Bush)在国情咨文演讲中，称贸易保护主义为“经济倒退”的一种形式。同样是在上个月，在达沃斯世界经济论坛(World Economic Forum)上，德国总理安格拉?默克尔(Angela Merkel)呼吁欧盟(EU)消除贸易壁垒。她形容世贸组织(WTO)建立更自由贸易的进展“甚微”。她表示，德国必须减少法规，减少工人在就业方面对政府的依赖。她的讲话获得了热烈的掌声。
本着同样的精神，我们必须表扬中国和印度的进步，而不是害怕它们进步。这些巨型经济体的发展，可能为全球带来更多的自由、民主和稳定，并有助于更强劲的全球经济增长。(设想一下危险的反面情况：24亿人经济前景渺茫。)没错，对于在这些全球转变中突陷困境的个人，我们必须关心他们的疾苦。但作为发达国家的我们假如要避免自身的衰落，并真正利用新兴市场的机会，那我们必须记住自身成功的催化剂――教育、创新、自立更生和开放的市场。我们必须抵制特权感和贸易保护主义的诱惑。
作者是花旗集团全球财富管理(Citigroup Global Wealth Management)首席执行官
