People are filing lawsuits under newly passed laws. As inflation eats away at employees' incomes, they are forced to find other means of supporting themselves. Western rating agencies like Standard and Poors and Moodys give investment-grade ratings to China. With high reserves, no history of default, and strong capacity to service foreign debt, China could have even better ratings if it were not for concerns about political stability. Gross domestic product has grown at 9 percent a year for the past thirteen years.
Chinese investors can now buy many types of securities.
China has made limited progress in securities regulation. Also, disclosure remains poor. The central planning apparatus remains strong. Accounting standards still need much work. Frequent government policy changes, as well as scandals, trigger volatility in the markets.