I was going to report on the Hainan Surfing Festival held January 23-30 this year, but decided it was just too Mickey Mouse with lousy wavelets and, to make matters worse, a male member of the Australian team wore a really fucking stupid bush hat during team photo ops. Anyway, you could see the pollution in the salt.
Whatever, I’m quite sure all participants trousered their appearance and prize money and said, ‘Lets get this gig out of the way, so we can return to (……) and get normal again”.
Hainan is is little more than a Sino-greedheads wet dream. Pity whats left of its old farming communities. Golf courses, a massive sex industry, high rise developments that would give Donald Trump multiple organisms, plus a submarine base disretely tucked away. You can explore Hainan’s coastline, plus wave and wind info etc using the Magic Sea Weed link HERE.
Two neat news reports today on the financial collapse of its Dubai copycat development Phoenix Island situated near its second city Sanya. Lets look at this eco-friendly monstrosity.
Tom Hancock of AFP reports that:
Chinese manufacturers once snapped up its luxury apartments, but with profits falling as a result of the global downturn many owners need to offload properties urgently and raise cash to repay business loans, estate agents said.
Now apartments on Phoenix Island which reached the dizzying heights of 150,000 yuan ($23,356) per square metre in 2010 are on offer for just 70,000 yuan ($10,899), said Sun Zhe, a local estate agent.
“I just got a call from a businessman desperate to sell,” Sun told AFP, brandishing his mobile phone as he whizzed over a bridge to the futuristic development on a electric golf cart.
“Whether it’s toys or clothes, the export market is bad… property owners need capital quickly, and want to sell their apartments right away,” he said. “They are really feeling the effect of the financial crisis.”
On the other side of Hainan, the Seaview Auspicious Gardens, boasts beachside villas accessed by artificial rivers and a private library containing 100,000 books, prices have fallen by a third from a high of 12,000 yuan per square metre in the last year, and a third of the flats remain unsold.
So much for a balanced economy, and I’m sure the library will get a real workout.
Max Fisher of The Washington Post asks Is This How The Collapse of The Chinese Property Market Begins?
Phoenix Island is an extreme case, but it’s in many ways symptomatic of China’s skyrocketing real estate market, which is both a blessing and a curse for China. A blessing because it helps to drive economic growth and domestic consumption, which the country’s economy needs more of to be healthy. It’s a curse because, as Americans are well aware, it can burst, pulling down much of the national economy with it.
In some ways (but not all), China is even more exposed to the dangers of a real estate collapse than America was.
Washington Post business reporter Jia Lynn Yang pointed out last fall that urban housing stock constituted 41 percent of Chinese household wealth of 2011. The number was 26 percent in the U.S. In other words, Chinese families tend to invest almost twice as much of their money in urban real estate than do American families. So, if you thought Americans were hit hard when that real estate suddenly lost value, it could be even worse for Chinese, who also tend to put much more of their earnings into long-term investments than do Americans.
And here’s the really scary number: 13 percent of Chinese GDP in 2011 came from real estate investment. 13 percent! If that investment stalls abruptly, as it did in Phoenix Island, the rest of the Chinese economy could follow.
There are are lot more nuances in the article, and it’s a recommended read since Patrick Chovanec provides that nuance.
Chovanec’s blog can be found HERE.
Okay, now its time to update my Japanese Surfer girl file next post.