Date issued: 8 July 2009
Eighty-six per cent of finance, accounting and business professionals surveyed in China expect the mainland economy to start to recover by mid-2010, according to a survey commissioned by CPA Australia.
Three quarters of survey respondents predicted growth in mainland China's real GDP of between 6 to 7.9 per cent by the end of 2009. Respondents viewed manufacturing, real estate, trade / exports and retailing as the industries to lead China's economic resurgence.
Chinese government spending was identified by 54 per cent of respondents as being the major driver of future economic growth, with investment and consumption being viewed by 21 per cent and 20 per cent respectively of respondents as the source of future growth.
The China economic recovery survey also revealed that nearly two-thirds (64 per cent) of respondents believed the global economic environment would not result in decreased Chinese investment in the Australian market over the next 12 months.
Mining and energy were identified by 75 per cent of respondents as the sectors that would provide most momentum for growth for China-Australia bilateral trade relations, followed by professional services (11 per cent) and tourism (8 per cent).
Half of the survey respondents also predicted that China would overtake the United States to become Australia's largest source of imports in 2009.
CPA Australia's Beijing president, Rebecca Mak, said that more than half of the respondents (53 per cent) believed that imposing stringent information disclosure requirements would help listed companies in China to improve transparency.
'The global financial crisis and subsequent economic downturn has reinforced the need for improved corporate transparency, governance and risk management to ensure the long-term sustainability and viability of a company.'
'Providing shareholders with frequent and easily interpreted financial information will help to increase investor confidence in the market and individual companies,' Ms Mak said.
In regard to the prospects for ongoing bilateral investments between Australia and China, respondents identified transparency of regulations (43 per cent), political stability (17 per cent) and intellectual property issues (15 per cent) as their major concerns.
Nearly half (47 per cent) of respondents predicted that more than 10 per cent of the authorised Chinese funds under the Qualified Domestic Institutional Investor Scheme (QDII) will be invested in Australia.
The QDII was established by the Chinese government in 2006 and is a scheme that allows Chinese investors to invest in recognised overseas equities markets through relevant products offered by approved Chinese banks, securities institutions and insurers.
Respondents were also confident about the performance of the Shanghai Stock Exchange Composite Index (SSE Index), with 49 per cent expecting it to reach a year high of between 3000 and 3499 during 2009.
About the survey: A total of 215 CPA Australia members in mainland China were surveyed over a ten-day period from late May to early June. The respondents were from the accounting, consultancy, education, financial services, insurance, legal, manufacturing, property and FMCG sectors in China.