Postcards from Summer Davos 2010: Vertical Nation
Ashok Vemuri, Senior Vice President and Global Head, Banking and Capital Markets; Strategic Global Sourcing, Infosys Technologies Ltd.
The Summer Davos was a roundtable on China. Delegates opined (not surprisingly) that the country will shape and provide direction to the global economy. They also sounded a note of caution about writing off the United States - businesses are sitting on huge amounts of cash, capital expenditure has increased, consumer spending is being boosted by savings, and rehiring is gathering momentum. Unlike the Great Depression or the financial crisis in Latin America and Japan, where policy interventions were slow, policy makers in the U.S. have responded immediately and decisively.
The property bubble in China is a cause for concern. Growth will be dictated by trade between emerging economies. The rebalancing of the global economy will be disruptive, and domestic demand in emerging economies will drive innovation and the next technology breakthrough.
The Shanghai Expo was yet another event that confirmed the size and scale of the Chinese juggernaut. Let me share a statistic that sums up the China story: 10,000 high rises were built in Shanghai in the last 10 years - effectively, 3 structures built and functional, every day!