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Global Economist Reveals Impact Of China’s Future Superpower Status On World Trading

8 June 2005

Some of Australia’s most influential financiers and business leaders have gathered across four states to hear world-renowned economist David Hale give a unique insight into global economic trends, as part of an exclusive cross-country tour hosted by Commonwealth Bank.

The Bank’s Institutional Banking division invited Hale to present his Global Economic Outlook series to their clients, which highlighted implications and opportunities for Australia and other world economies, as China emerges as a new economic superpower.

David Hale, said, "China’s population is now just 65 per cent rural, compared to 80 per cent in 1970.

"Looking forward 20 or 30 years, and comparing this trend to what happened during the industrialisation of other developed economies, it is likely that the urbanisation process could see the population shift to 65 per cent urban-based over that period with the rural share significantly falling.

"This means that China effectively has to build the equivalent of a New York City every 12 months to cope with this massive shift of the population," he continued.

"China has in recent years become the world’s largest consumer of most industrial metals and other resources, giving resource rich developing countries substantial improvements in their terms of trade and contributing to current account surpluses in many resource exporting regions.

"Despite an unprecedented surge in capital investment in China, and this huge growth in its demand for raw material imports, China remarkably still enjoys a substantial current account surplus.

"For that reason," Hale continued, "China is virtually immune from the sort of economic crisis experienced by other Asian nations during the late 1990’s."

Chicago-based Hale presented a total of seven sessions on the global economy, political trends and market events as he addressed audiences of almost five hundred Commonwealth Bank clients in Sydney, Canberra, Melbourne and Perth. The series also focused on economic issues in relation to specific key industry groups such as government, resources, media and telecommunications.

Ian Saines, Executive General Manager of Institutional Banking, said, "We had an outstanding response to the series.

"Most importantly, we’ve been able to provide our clients with valuable, relevant and insightful information, delivered by a world-wide leader in his field."

Saines added, "Engaging David is another step in a program of initiatives that Institutional Banking has developed to really focus on our customers’ industries, and ensure that we are furthering the Bank’s strategy of delivering creative and innovate ideas and excellent customer service."

Hale also provides a range of research reports on economic issues and conducts regular Economic Insights teleconferences as part of his involvement with Commonwealth Bank.