<html><body>
EXPERT OBSERVER
To date, the USA has close to 100 deaths due to coronavirus, Italy has more than 1,100, Iran has more than 600, Korea has more than 70 deaths. Australia now has 3.
Meanwhile, China is reported to have contained the coronavirus, achieving what many public health experts thought was impossible: containing the spread of a widely circulating respiratory virus.
Having spent my time in China for a month early this year and seeing it with my own eyes, I think China has rolled out the most ambitious and extreme disease containment effort in history.
Perhaps the most dramatic effort was the lockdown of Wuhan city and nearly the entire Hubei province, effectively putting at least 50 million people under a mandatory quarantine since 23rd Jan. This prevented further exportation of infected individuals to the rest of the country/world. In other regions of China, people voluntarily quarantined themselves and were monitored by appointed leaders in the neighbourhood.
In February, Chinese authorities also built two dedicated hospitals in Wuhan in 10 days. Health care workers from all over China were sent to Wuhan, where more than 1,800 medical teams traced tens of thousands of contacts of confirmed cases.
Sports events were cancelled, cinemas were shut, schools and universities extended breaks, businesses closed down, people stayed at home and when they had to go outdoors (to do shopping etc) everyone had to wear a mask.
In contrast, despite the stimulus package, Scott Morrison has been encouraging people to keep attending mass gatherings as coronavirus continues to spread in Australia... until Peter Dutton gets it.
China has moved on. Close to 70,000 people were treated and recovered. Many of the hospital beds are now empty. China is eyeing "new infrastructure" projects to offset the economic impact of the coronavirus, and boost sustainable growth, e.g. accelerate the construction of new infrastructure such as 5G networks and data centres.
Instead of simply turning to the old playbook of investment stimulus, it is widely believed that China should promote a new round of infrastructure construction through reform and innovation.
Investors have already jumped on the bandwagon. In China's A-share market, stocks related to 5G networks, industrial internet, inter-city transit systems, vehicle charging stations and data centers -- all considered as new infrastructure -- saw continued fund inflows, with exchange-traded funds linked to these shares registering gains in the past weeks.
While policy incentives have guided market funds into the sector, the Chinese government is also expected to encourage new infrastructure via special bonds, public-private partnerships and credit support. About 714.8 billion CNY ($152.7 billion AUD) of special-purpose bonds were issued in January, 10 times the amount of general bonds issued.
So how is this going to impact the Australian economy?
Well, China is Australia's biggest trading partner mainly due to China's strong demand for iron ore, coal and liquefied natural gas. Many major Australian mining companies rely heavily on China. Australia's GDP growth could be reduced by 50% in a worst case scenario of China reducing its demand for Australia's exports.
Simply put, if China's economy crashes then Australia will be hit hard.
With China's new round of infrastructure construction, Australia will be one of the major beneficiaries, economy-wise. This could mean a contribution of $200 billion worth of imports and exports to the Australian economy, just like 2017-18.
Industry sectors such as education and tourism might still continue to suffer because of flight restrictions. However, flights might not be needed for cross-border property purchases. There might be a drop-off in open for inspection and auction attendance, but Chinese buyers do not have to come to Australia to purchase properties.
In my Chinese social media WeChat, I can see at least 20 people (buyers, that is) showing off their property purchases in Australia, while they are physically in China. They included private sales, off-the-plan or nominee sales, and "remote auction" - asking their friends/family to attend auctions on their behalf.
This trend will probably continue in the months to come. At GiFang, we will be sending further messages to our 200,000+ Chinese subscribers that if they require 'buyer assistance', we can act as an intermediary between them (no matter where they are) and the Australian agents, on properties listed on GiFang.com.
Michael Yang 杨霄羽 is the CEO of <a href="http://www.gifang.com" target="_blank">GiFang</a>.
</body></html>

MichaelYang-M4BCtFfzCh

Post coronavirus how will China's economy impact Australia: GiFang's Michael Yang

<html><body>
GUEST OBSERVATION
Since the year 2010, the Chinese property developer Vanke has been the largest residential property developer on planet Earth by annual sales volume.
From a sales revenue of ‘only’  RMB 1.2 billion (equivalent to A$207 million) per annum in 1998, to a staggering revenue of RMB  170.9 Billion (A$29.4 billion) in 2013, Vanke has surely created history in the world of property development. But the Chinese publicly listed company is not the only one that made big profit. In fact, since 1998, the fast pace of property development industry in China has made a large number of billionaire and multimillionaire developers. While at the same time, the term “property developers” in China has been associated with terminologies such as “corruption”, “astronomical price”, “ridiculously huge profit”, it seems Chinese developers are among one of the most negatively seen groups in China.
ZhiQiang Ren, Chairman of HuaYuan Developments Ltd, one of China’s four largest property developers, says he is almost the third most hated person in China – after Junichiro Koizumi (former prime minister of Japan) and Chen Shui-bian (a former Taiwanese politician who was president from 2000 to 2008 and is imprisoned in 2008 for corruption and money laundry).
“And that’s purely because I am seen as the most active and publicised developer in China, where developers are known to be associated with the “dark side” of business making so much profit,” he laughs.
But is property development really a profitable business China-wide?
The answer is no, and there are good reasons – the same reasons that lead to the fact that a wave of Chinese developers are acquiring land overseas, including Australia.
The first reason is simply because it is too expensive to acquire land in China, in comparison to countries such as Australia. Chinese buyers blame Chinese developers for irregularly increasing the property prices, without realising that the Chinese local government is doing the same on land prices to developers. “If you buy a property in China, say if it costs RMB 30,000 (A$5,172) per square metre which is about average price in Beijing,” says XianPing Lang, one of China’s most well known economists, “20,000 of this RMB 30,000 goes to paying for the land component, which means most of the profit gets pocketed by the government.” “In the recent years, there has been an average of RMB 1.69 trillion (equivalent to A$290 billion) of land transactions every year from land sales to developers,” says XianPing, “which equates to almost 48% of total fiscal revenue of the Chinese local government.” My view is that in any country, if the land acquisition component is as high as 66% of the sales revenue, any developer would struggle with making a profit.
In our dealings with Chinese developers, particularly those who recently came from China, they seem to be impressed with the price value ratio of the land, and how “clean” or straight forward a transaction could be.  Plus, there is so much land available in Australia, comparing with China, and most land is privately owned. The second biggest reason is exactly that – the availability of land in countries overseas, in comparison to China.
“In recent years, China’s Department of Land Resources plan to have approximately 185,000 – 200,000 hectares of land per year made available for development, but according to figures by developers, only less than 50,000 hectares were released per year,” says ZhiQiang.
In Australia, where land transactions mostly take place between private owners and buyers, more and more small to medium Chinese developers have taken the opportunity to acquire land. Most focus on inner city locations such as Melbourne, Southbank, South Yarra and St Kilda, as well as areas popular for Chinese residents such as Doncaster, Box Hill, Glen Waverley of Victoria and Hurstville, Chatswood and Epping of New South Wales. “Many Chinese developers are venturing into the medium density sites with developments ranging from four townhouses up to 20 apartments” comments Tim Heavyside, Director of Fletchers Real Estate. “These properties tend to sell quickly and allow developers a speedy turnaround for their investment.  “Some of these developers have also commented on the availability of these sites being many more than currently being offered in China.”
Michael Yang is CEO of <a href="https://www.GiFang.com" target="_blank">GiFang.com</a>, Australia’s leading property portal open for high networth Chinese investors.
</body></html>

Michael Yang

Editor's Picks

Have something to contribute?

Developments

New apartments

New townhouses

News