Beijing wants to pull in the reins and show who's in charge,'' says Laurence Lipsher, head of the American Chamber of Commerce in Guangdong. China's lost momentum for reform creates a twofold risk. The first is that China drifts along. While it relies on ad hoc measures and the old tools of central planning to stave off unrest, it loses precious time transforming itself into a market economy. The second is that multinational enthusiasm for China seriously weakens, leaving China without new technology and management skills and ultimately further behind the New Economies of the West.
Chinese authorities know that foreign investors are hurting.
But they are doing little about it, hoping an economic rebound in 2000 will create new business for foreign and local companies alike. But it's a gamble. Some will say, 'Let's go home or cut back.''' It would be tragic if China put reform on hold for too long. The country has traveled a long and hard road to reach its present level of prosperity. And a stagnating China would pose a serious threat to Asia's recovery and the global economy at large.