China’s Private Firms Drive Investment Expansion

As China's economy leaps forward, many firms are churning out big profits that they are using to power up and expand their businesses, says a Financial Times article [closed access]. These even include some of the state-owned semi-monopolies such as China Mobile. The force of the country's profit-driven investment boom is making it harder for the central government to slow down the economy.

Surprisingly, it isn't householders who are China's biggest savers -- it's the country's corporate sector. Both private and public firms are the driving force behind China's investment expansion.

Some economists -- both foreign and Chinese -- say a more flexible renminbi is the answer. If the currency were more expensive, they say, it would trim the trade surplus or slow growth. But China's establishment cannot agree on what to do with the currency.