Saturday, 3 April 2010

Doing Business with China

Some of my family lived in China in the later part of the 19th century.
However since 1949 I have regarded mainland China as the red peril -- though Chairman Mao’s Little Red Book was rather fun to pass around at school.
China’s economic advancement is proving an ideological challenge. I’ll pay a little extra for goods of equivalent quality from anywhere but China. But if Chinese stuff is cheaper, then it’s costly to boycott it.
So what about investing there? Corruption is rife, and the penalties severe, though as four employees of Rio Tinto will find out this week, those imprisoned for economic crimes are treated far less harshly.
I’m putting this year’s tax-exempt savings into a new investment trust that will buy into companies that do business in China. Domestic consumer spending is set to take off, creating huge economic expansion.
Investing in China is not for the faint-hearted.

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