Title: China: how powerful is she?
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Content: But these foreign exchange reserves are a costly investment, as they earn a very low rate of return. In fact, Chinese citizens' lives would be much better if they were spent on imports. But Chinese internal politics stop the government from revaluing the exchange rate, which could also provide a stimulus to industrial upgrading. Let's move on now to politics. How powerful is the Chinese government? All the evidence suggests that the Chinese government is nervous, panicked and paranoid. It is frightened by the Internet undermining its grip on power. How could the Internet become such a destabilising force? The Chinese public are sick and tired of official corruption, abuses of power, widening gaps between rich and poor, lack of freedom of speech, and so on -- and they are not afraid to blog and protest about this. And the Chinese government's nervous reaction to everything from high-speed train crashes and food safety scandals reveals the insecurity of its grip on power.