HELLO !!I NEED HELP WITH A PARAPHRASING OF FOUR PARAGRAPHS ON A ECONOMIC READING. Please let me know if you can help me immediately
This is from some articles online
Trend 1. The shift in investment: from â€œminingâ€ to â€œdiningâ€
Owing to the massive build-out of Chinaâ€™s physical infrastructure over the past decade, the nationâ€™s strategic M&A focus has long been directed toward the acquisition of natural resources. Think â€œminingâ€ or strategic investments in Canada, Australia, Africa and South America. Steel, copper and iron ore acquisitions fall under this umbrella, with Chinese acquisitions in the mining sector totaling $30 billion in 2008. The value of mining deals dropped sharply in 2009, thanks to the global financial crisis, but averaged nearly $20 billion per annum over 2010-2012.
Beginning in 2013, however, Chinaâ€™s strategic M&A focus shifted. As the government reeled in excess lending to the overheated property market, demand for â€œminingâ€ assets declined; the priority shifted toward â€œdiningâ€ or acquisitions directed toward satisfying the growing demands of Chinaâ€™s more affluent middle class. The wealthier a population becomes, the greater the level of consumptionâ€”i.e., the greater the demand for protein, fast/convenient food, beverages and related items, among other things. Against this backdrop, Chinese acquisitions within the â€œdiningâ€ space soared to nearly $13 billion last year, a record high, and have remained quite strong over the first half of 2014.â€
Investment implications:Â Quinlan expects more Chinese mergers in the U.S. food industry â€” like the recent purchase of Smithfield Foods â€” and related sectors. Chinese inbound investment in the U.S. is bullish for someÂ U.S. equities in this space.
Trend 2.Â The shift in capital flows: two-way instead of one-wayÂ
For decades, inbound investment flows were strongly encouraged, while outbound investment flows were highly restricted. China preferred that its scarce capital stay at home to promote growth, along with strong capital inflows. China is awash in excess capital. Chinaâ€™s international reserves are presently in excess of $3 trillion, an abundance of wealth that Chinaâ€™s underdeveloped financial system cannot absorb. Hence the need to allow greater capital outflows. As part of this trend, Chinese demand for global real estate has soared over the past few years, with the United States a primary target. To wit, Chinese buyers plunked down $12 billion in U.S. real estate last year.
Investment implications:Â The U.S. residential and commercial real estate markets will remain prime targets of Chinese investment. So will hard assets like timberland and farmland, according to Quinlan.
.Trend 3. The shift in consumer leverage: more, not less
The rising use of credit, notably among younger Chinese consumers, will be critical in driving personal consumption expenditures in China in the future. Buying a car in China is still primarily a cash transaction, but things are changing. U.S. and foreign car makers, through their financing arms, are changing the rules of the game by encouraging/pushing car loans in the worldâ€™s largest automobile market. Outstanding car loans in China were 10% higher at the end of the first quarter than the same period a year ago, helping to propel overall auto sales in China.
Investment implications:Â When it comes to loan-financing a car, China is way behind the rest of the world. However, a one-time cash practice is shifting; auto financing is catching hold in China, a bullish prospect for U.S. automobile makers, says Quinlan.
Trend 4. The shift in shopping: online shopping (ecommerce) explodes
Total retail sales in China in the first half of the year rose 12.1% from a year ago. Thatâ€™s not terribly robust by Chinese standards, but the more telling story is this: Online retail sales over the same period soared 48.3%. Online sales in China are now greater than comparable sales in the United States, a trend that speaks to the growing use of the internet in China and the e-commerce culture that is taking hold in China. A decade ago, there were very few e-commerce platforms in China, and the nation lagged in the development of payment systems and physical delivery mechanisms to underpin e-commerce transactions. Today, much has changed. With some 600 million internet users in China, e-commerce revenue growth has grown at a 70% compounded annual average over the past few years. These figures speak to the growing sophistication of Chinese consumers and their underlying purchasing power. It also speaks to the underlying dynamics of Chinaâ€™s internet capabilities; unbeknownst to many investors, the mainlandâ€™s internet infrastructure is much more developed than commonly thought.
Investment implications:Â The soaring use of e-commerce in China is part and parcel of the nationâ€™s shift toward more consumption-led growth. There is tremendous upside for Chinaâ€™s e-commerce market, but many U.S. firms have found it very tough to crack the market, thanks to intense local competition and government regulations. This is an indigenous Chinese play; think local when investing in Chinaâ€™s e-commerce.
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