It now seems very likely that China's economy will meet or exceed Beijing's 7.5% growth target for 2013. For President Xi Jinping, still in his first year of office, this is very good news.
At the same time, heading into a pivotal meeting of the Communist Party, the country's policy landscape is unusually unsettled. Clarity on three key items -- local debt, economic reform plans and the Shanghai Free Trade Zone -- would go a long way toward reducing economic uncertainty in the Middle Kingdom.
Can China get its local debt under control?
China's credit boom, launched to support the economy after the 2008 financial crisis, has saddled unworthy businesses with large loans, fueled the country's shadow banking system and put local governments on the hook for billions.
Here's the problem: Nobody knows exactly how much debt China's local governments have soaked up. Not even Beijing.
Economists surveyed by CNNMoney earlier this month estimated debt levels reached 14.1 trillion yuan to 19.7 trillion yuan by the end of last year, or roughly one-third of the country's gross domestic product. Those estimates put local debt at nearly double what it was three years ago, when China last conducted a nationwide debt audit.
Economists are awaiting the most recent results from another debt audit launched in July, expected to be announced sometime in November. The audit should provide a sense of just how big the problem is -- and just how hard of a credit crackdown is needed.
Will November be a turning point for economic reform?
The general consensus among China analysts is that President Xi could prove to be a leader in the mold of Deng Xiaoping -- a reformer who emphasized economic improvements over ideology.
That theory will be put to the test in November, when the Communist Party holds its third party plenum. The meeting is widely expected to produce a framework for reform.
"For many China observers and market participants, this is the 'make or break' moment," said UBS economist Tao Wang. "If the new government does not launch sweeping reforms now, many people believe, China's economy is heading for the ruins."
The list of issues that demand attention is staggering: Local debt, shadow banking, credit growth, property prices, urbanization policy, private sector innovation, the internationalization of the yuan and income inequality.
What will the party address in November? How detailed will the reform plans be? How quickly will changes be made? Analysts will be watching closely.
Just what is the Shanghai Free Trade Zone?
China cut the ribbon in September on its new free trade zone in Shanghai, an effort to expand foreign investment access and liberalize the financial sector. The 29 square kilometer zone is meant to be something of an economic laboratory, and successful projects could eventually be rolled out across the country.
But a few months into the experiment, details remain thin. Foreign firms are not exactly flooding into the area, and several reported reforms -- including an uncensored Internet -- have failed to materialize.
It's possible that China's bureaucrats will loosen their grip -- but there have so far been precious few hints about China's long-term plans for the Shanghai zone.
When the current crop of Chinese leaders assumed power, they wasted no time in ordering an extensive audit of local government debt.
Presumably the new team, led by President Xi Jinping, wanted to know what everyone else wants to know: How has China's massive expansion of credit since 2008 affected state finances?
The uncomfortable truth is that nobody has a great handle on exactly how much local governments have spent.
The bean counters MORECharles Riley - Sep 18, 2013 5:32 AM ET
Most readers are probably familiar with a game called "pin the tail on the donkey" -- a staple of birthday parties for children under the age of 10.
For the uninitiated, the game involves a blindfold, a disorienting series of spins and an attempt to pin "the tail" on a paper "donkey." Nobody ever seems to get the pin in quite the right spot. But it can be quite entertaining to see the MORECharles Riley - Jul 12, 2013 5:04 AM ET
A big chunk of Iraq's oil production is going to China, according to a story Monday in the New York Times. That may be a good thing for both U.S. companies and consumers.
The Times reported on what has been an ongoing trend -- companies from China and elsewhere winning Iraqi oil contracts. According to the story, nearly half of Iraq's oil now goes to China.
The article played up the seeming MORESteve Hargreaves - Jun 3, 2013 1:46 PM ET
Are China's economic statistics accurate?
Pose this question to a group a China watchers and you're likely to receive a variety of responses. Some observers are convinced that China is cooking its books. Others believe state statistics are largely reliable and useful for drawing conclusions about the world's second largest economy. Still others will debate the accuracy of certain data classes, pointing to more meaningful alternatives.
Now we have an opinion from researchers MORECharles Riley - Mar 26, 2013 6:57 AM ET
Premier Wen Jiabao opened China's annual parliamentary meetings Tuesday by issuing a new set of targets for the world's second largest economy.
The target for gross domestic product growth will remain 7.5%, but the government said it will carry a larger deficit in 2013 to help finance spending plans.
China recorded its weakest growth in 13 years in 2012, but a rebound in the fourth quarter removed any lingering concern that its MORECharles Riley - Mar 4, 2013 11:01 PM ET
The National Intelligence Council -- the same thinkers who produce National Intelligence Estimates -- has released an 140-page report that offers a series of prognostications about how the world might change in coming decades.
The report is full of all kinds of fun concepts, like powered exoskeletons designed to help the elderly, bio-based energy and 3-D printing. You can read the full report here.
But one of the biggest economics themes of the report is the MORECharles Riley - Dec 10, 2012 10:46 PM ET
The United States may be hurtling towards a fiscal cliff at the end of the year. But if the U.S. is Thelma then China is Louise. Despite continued fears about another debt ceiling debacle at the end of this year, China is buying U.S. Treasury debt like it's going out of style ... or like it's Facebook stock.
The Treasury Department released its latest figures on foreign holdings of U.S. debt MOREPaul R. La Monica - May 15, 2012 2:57 PM ET
China's booming economy is giving to the poor and taking from the rich when it comes to housing.
Some 14% of both the rich and the poor said they had trouble affording shelter in 2011, according to a recent Gallup survey. That's a dramatic change for each group in recent years, but the shifts were in opposite directions.
For the poor, 14% is half the percentage of people who didn't have enough MORETami Luhby - Mar 27, 2012 2:32 PM ET
U.S. exports to China topped $100 billion for the first time in 2011, the latest in a series of rapid expansions, according to a new report from the US-China Business Council.
That means China -- the world's second largest economy -- trails only Canada and Mexico as a buyer of American goods. Exports hit $103.9 billion in 2011, an increase of $12 billion over the previous year.
The recent growth will go MORECharles Riley - Mar 27, 2012 11:04 AM ET
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