Intentions can change. Secondly, based on my hard-learned lessons, the number one problem with investing in China is actually a moral hazard. People are given positions of responsibility without appropriate systems of punishment and rewards to govern their behavior. The world has too much supply of everything. I know that the Chinese government will do whatever it takes to gets its people to consume more.
Red chips are a moral hazard.
Ng Fung Hong Ltd., which is a widely held institutional stock. I am not saying that it is the best company in the world, but it does have a reasonably cohesive investment strategy and demonstrable returns rather than just a grab bag of businesses which don't make any sense. Some of these companies are leveraged to the hilt. Yes, starting this year you will see increasing encouragement of what they call SMEs - small and medium enterprises. Recently, they changed the Chinese constitution itself to give more emphasis to the role of the small enterprise in China.