如果想了解中國(guó)經(jīng)濟(jì)走勢(shì)，最好聽(tīng)聽(tīng)私募股權(quán)圈大佬單偉建怎么說(shuō)。他對(duì)當(dāng)前中國(guó)經(jīng)濟(jì)困境的看法是：經(jīng)濟(jì)減速剛剛開始，但長(zhǎng)期來(lái)看比較穩(wěn)健。

單偉建的觀點(diǎn)之所以很有價(jià)值，因?yàn)樗梢詮娜N對(duì)立的角度看待中國(guó)經(jīng)濟(jì)，很少有專家能做到。首先他是亞洲最大私募股權(quán)公司太盟投資的首席執(zhí)行官，深耕本地市場(chǎng)；其次，他曾在美國(guó)接受教育，獲得了經(jīng)濟(jì)學(xué)博士；此外，他的個(gè)人經(jīng)歷與國(guó)家發(fā)展同步，曾作為知青下放插隊(duì)，后來(lái)又趕上了中國(guó)經(jīng)濟(jì)發(fā)展奇跡，為投資者賺得數(shù)十億美元。

1月下旬一個(gè)周二晚上，我在紐約曼哈頓上城區(qū)西部的一家咖啡廳里見(jiàn)到了單偉建，他點(diǎn)了一杯熱水，后來(lái)提到當(dāng)晚要參加董事電話會(huì)議。

單偉建主要在香港生活工作，他到紐約主要為了宣傳新書《走出戈壁灘：我在中國(guó)和美國(guó)的故事》。書中回憶，1969年，他只有十多歲時(shí)離開北京的家，在戈壁灘勞動(dòng)六年。改革開放后，他有機(jī)會(huì)成為第一代政府公派前往美國(guó)學(xué)習(xí)的留學(xué)生。

單偉建在加州大學(xué)伯克利分校獲得國(guó)際貿(mào)易專業(yè)博士學(xué)位，博士論文指導(dǎo)老師是之后擔(dān)任美聯(lián)儲(chǔ)主席的珍妮特·耶倫，后來(lái)他加入沃頓商學(xué)院擔(dān)任教師。書中結(jié)尾是一段講了他回到搖搖欲墜的廢棄營(yíng)房的見(jiàn)聞。他曾在農(nóng)村當(dāng)“赤腳醫(yī)生”，所謂“赤腳醫(yī)生”屬于中國(guó)農(nóng)村干部，接受過(guò)治療小病的基本醫(yī)療培訓(xùn)。他遇到轉(zhuǎn)行養(yǎng)豬的老朋友們，因?yàn)檠谉岬耐恋厣弦褵o(wú)法謀生?！拔覀兣闪舜笈贻p人與自然斗爭(zhēng)，把戈壁變成了可耕種的農(nóng)場(chǎng)?！彼麑懙馈！叭欢罱K自然還是勝利了，戈壁也變回了原樣。”

中國(guó)一個(gè)時(shí)代的結(jié)束

《走出戈壁灘》一書并未涉及單偉建回國(guó)從商的經(jīng)歷，但在交談中單偉建表示最大的愿望是幫助中國(guó)和亞洲其他國(guó)家發(fā)展私募行業(yè)。他曾在摩根大通香港分公司工作五年，1998年加入了私募股權(quán)大鱷TPG。他在TPG工作了12年，2010年聯(lián)合創(chuàng)立了太盟投資，擔(dān)任總裁兼首席執(zhí)行官。如今該公司管理資產(chǎn)達(dá)300億美元，成為業(yè)內(nèi)巨頭。

單偉建對(duì)過(guò)去20年里中國(guó)的發(fā)展大加稱贊，但也警告稱高速發(fā)展的時(shí)代已經(jīng)結(jié)束。他的觀察結(jié)合了對(duì)上海和北京高管圈的態(tài)度，還有身為經(jīng)濟(jì)學(xué)家的判斷?！叭绻?019年中國(guó)GDP增幅降至6%，我也不會(huì)吃驚?！彼硎荆撛鏊俦热ツ曜屓耸?.6%增幅還要低，而去年的增速已是1990年以來(lái)最低。

單偉建認(rèn)為，當(dāng)前經(jīng)濟(jì)疲軟有兩個(gè)短期因素，但提醒說(shuō)中國(guó)正經(jīng)歷長(zhǎng)期轉(zhuǎn)變，遠(yuǎn)離快速增長(zhǎng)的制造業(yè)，未來(lái)經(jīng)濟(jì)增長(zhǎng)更有可能小步快跑，不太可能保持之前的高速狀態(tài)。

他表示，兩大短期因素里第一個(gè)是信貸嚴(yán)重萎縮?！皟赡昵?，政府開始打擊提供私營(yíng)領(lǐng)域大部分信貸的‘影子銀行’網(wǎng)絡(luò)。”他表示，而且稱中國(guó)私營(yíng)領(lǐng)域主要是中小型企業(yè)。中央政府擔(dān)心，“影子”系統(tǒng)里的信托公司和其他信貸機(jī)構(gòu)過(guò)度擴(kuò)張，魚龍混雜的各種機(jī)構(gòu)可能崩潰，影響經(jīng)濟(jì)發(fā)展。

與此同時(shí)，政府規(guī)定國(guó)有銀行至少將50%貸款投給中小企業(yè)，從而保持信貸流動(dòng)。“但大型銀行不想貸給私營(yíng)企業(yè)，因?yàn)轱L(fēng)險(xiǎn)較高?！眴蝹ソㄕf(shuō)?！按筱y行總想貸給大型國(guó)有企業(yè)，因?yàn)閲?guó)企背后有政府支持，非常安全?！彼硎?，由于銀行拒絕，“劃定比例也沒(méi)用?！痹谒磥?lái)，私營(yíng)領(lǐng)域缺少銀行信貸支持，無(wú)法辦新廠、開醫(yī)院和商店，所以現(xiàn)在經(jīng)濟(jì)增速放緩。

第二個(gè)阻礙是中美貿(mào)易爭(zhēng)端。“對(duì)企業(yè)直接的影響很小，”他表示。“但對(duì)商業(yè)界的信心沖擊很大。貿(mào)易爭(zhēng)端打擊了中國(guó)制造商的信心，影響進(jìn)一步投資?！?/p>

單偉建表示，如果想解決沖突，中國(guó)應(yīng)該降低對(duì)美國(guó)進(jìn)口產(chǎn)品的關(guān)稅，并放松美國(guó)中國(guó)企業(yè)持股比例的限制?！叭绱艘粊?lái)，汽車、手機(jī)和其他美國(guó)進(jìn)口產(chǎn)品對(duì)消費(fèi)者來(lái)說(shuō)會(huì)更便宜，也逼著中國(guó)競(jìng)爭(zhēng)對(duì)手提升競(jìng)爭(zhēng)力。”他說(shuō)。“降低相關(guān)產(chǎn)品價(jià)格后，消費(fèi)者也會(huì)有更多錢花在其他產(chǎn)品上，比如家用電器或雜貨等。此舉有助于經(jīng)濟(jì)增長(zhǎng)。由于中國(guó)正逐漸轉(zhuǎn)向消費(fèi)社會(huì)，在占據(jù)經(jīng)濟(jì)大部分的領(lǐng)域促進(jìn)競(jìng)爭(zhēng)和效率也越發(fā)重要。”

減少制造業(yè)，增速放緩

單偉建稱，實(shí)際上中國(guó)由制造業(yè)轉(zhuǎn)向消費(fèi)主導(dǎo)型經(jīng)濟(jì)過(guò)程中，未來(lái)增速放緩不可避免。中國(guó)經(jīng)濟(jì)主要影響因素是人口。人們普遍認(rèn)為“獨(dú)生子女政策”最終將導(dǎo)致中國(guó)勞動(dòng)力人口減少。（2015年計(jì)劃生育政策已經(jīng)取消。）

對(duì)單偉建來(lái)說(shuō)，隨著大批人口從農(nóng)村移居城市，人口問(wèn)題得到了緩解，但也被掩蓋起來(lái)。“就在50年前，我下放到戈壁灘時(shí)，中國(guó)開始了人類歷史上大規(guī)模的‘農(nóng)村化’。”單偉建說(shuō)。“城市人口1.6億，有1600萬(wàn)人被送往農(nóng)村和荒地。過(guò)去20年又出現(xiàn)了人類歷史上大規(guī)模的城市化。正是因?yàn)檗r(nóng)民前往城市里的工廠工作，才推動(dòng)了中國(guó)的工業(yè)化?！?/p>

他警告稱，該趨勢(shì)已經(jīng)達(dá)到頂點(diǎn)?！艾F(xiàn)在中國(guó)面臨勞動(dòng)力短缺的局面，勞動(dòng)力成本也不斷提升。”他表示。“過(guò)去十年里勞動(dòng)力成本增加了11%，中國(guó)制造商出口產(chǎn)品的價(jià)格卻持平甚至走低。這也是中國(guó)出口領(lǐng)域比不過(guò)越南和印尼等亞洲國(guó)家的原因。”

以前中國(guó)工業(yè)非?？释顿Y，中國(guó)家庭購(gòu)買商品時(shí)也沒(méi)有太多選擇，所以大部分收入都儲(chǔ)蓄起來(lái)。大量?jī)?chǔ)蓄充實(shí)了銀行的資本，也為制造業(yè)強(qiáng)勢(shì)崛起輸送了資金。那些日子一去不復(fù)返了。如今，勞動(dòng)者的收入里有很大一部分用來(lái)購(gòu)買耐克運(yùn)動(dòng)鞋、精致的食物，還有香港和巴黎度假。“以前的儲(chǔ)蓄投資模式已經(jīng)沒(méi)用?！眴蝹ソㄕf(shuō)。他指出，十年前出口占GDP的36%，出口基本上是制造業(yè)，消費(fèi)占35%。十年里，出口降到國(guó)家收入的19%，消費(fèi)則升至50%。

制造業(yè)大量投資推動(dòng)的國(guó)家比消費(fèi)主導(dǎo)經(jīng)濟(jì)有活力得多，單偉建說(shuō)?！皞€(gè)人消費(fèi)對(duì)經(jīng)濟(jì)的推動(dòng)比不上制造業(yè)投資。”他指出，并解釋程基礎(chǔ)工業(yè)發(fā)展可以實(shí)現(xiàn)“乘數(shù)效應(yīng)”。在新工廠投資1萬(wàn)億美元后可創(chuàng)造新的就業(yè)崗位，也可以建造更多工廠提供零部件和電力。“與之相反，”單偉建表示，“消費(fèi)支出沒(méi)有乘數(shù)效應(yīng)，無(wú)法像投資制造業(yè)一樣推動(dòng)經(jīng)濟(jì)增長(zhǎng)。”

要問(wèn)單偉建的結(jié)論，就是由制造業(yè)轉(zhuǎn)向消費(fèi)的歷史進(jìn)程決定了中國(guó)經(jīng)濟(jì)未來(lái)發(fā)展將放緩。不過(guò)他補(bǔ)充說(shuō)，中國(guó)仍可通過(guò)降低國(guó)有經(jīng)濟(jì)領(lǐng)域，進(jìn)一步鼓勵(lì)私營(yíng)領(lǐng)域擴(kuò)張，為經(jīng)濟(jì)增長(zhǎng)騰出空間。僅僅為了維持現(xiàn)有增長(zhǎng)水平，也要提升相關(guān)領(lǐng)域的效率。

有人預(yù)計(jì)中國(guó)將采取大規(guī)模刺激計(jì)劃推動(dòng)增長(zhǎng)，他怎么看？單偉建認(rèn)為不太可能?！爸袊?guó)當(dāng)然有能力這么做?！彼f(shuō)?！爸袊?guó)的財(cái)政狀況比其他大國(guó)都要好。中央政府的債務(wù)對(duì)GDP占比僅為17%，外匯儲(chǔ)備有3萬(wàn)億美元，而且外國(guó)投資者僅持有小部分主權(quán)債務(wù)?！钡A(yù)計(jì)政府不會(huì)輕易開放貨幣閘門。他表示，過(guò)去兩年，政策的主要目標(biāo)是限制消費(fèi)和商業(yè)領(lǐng)域過(guò)度杠桿的狀態(tài)，避免制造資產(chǎn)泡沫，一旦破裂可能拖累經(jīng)濟(jì)。在單偉建看來(lái)，政府認(rèn)為過(guò)度信貸比限制限制信貸更有可能影響經(jīng)濟(jì)增長(zhǎng)。

資產(chǎn)泡沫？可能性不大

有人擔(dān)心中國(guó)推動(dòng)住房和其他房地產(chǎn)價(jià)格快速升高，一旦價(jià)格驟降可能出現(xiàn)災(zāi)難性的后果。單偉建認(rèn)為相關(guān)擔(dān)心言過(guò)其實(shí)，中國(guó)不會(huì)出現(xiàn)2008年到2010年的美國(guó)金融危機(jī)，或1997年到1998年的亞洲金融危機(jī)。

“之前兩次（危機(jī)）都是房地產(chǎn)市場(chǎng)崩盤導(dǎo)致，但關(guān)鍵是房產(chǎn)市場(chǎng)崩潰重創(chuàng)了銀行系統(tǒng)，導(dǎo)致信貸緊縮，隨后出現(xiàn)更嚴(yán)重的衰退?！眴蝹ソū硎??！吧鲜兰o(jì)90年代末，亞洲數(shù)百家銀行倒閉。我們（TPG）買了幾家?！彼^續(xù)說(shuō)，差別在于在中國(guó)法律和銀行業(yè)規(guī)定的限制下，銀行在房地產(chǎn)市場(chǎng)的杠桿不高，風(fēng)險(xiǎn)也可控。

他列出了四個(gè)原因證明銀行業(yè)杠桿不高，所以銀行系統(tǒng)很安全?！笆紫?，銀行放貸時(shí)不高于購(gòu)買價(jià)格的70%到80%，”他表示，“說(shuō)明購(gòu)房者掌握大部分產(chǎn)權(quán)。第二，房?jī)r(jià)漲了很多，現(xiàn)有購(gòu)房者已經(jīng)支付了部分貸款，所以整體經(jīng)濟(jì)中購(gòu)房者持有的產(chǎn)權(quán)比例大概在50%左右。”

第三，中國(guó)人對(duì)償還房貸很負(fù)責(zé)。如果面臨贖回，他們不會(huì)像金融危機(jī)期間數(shù)百萬(wàn)美國(guó)人一樣放棄了之?！芭e例來(lái)說(shuō)，亞洲金融危機(jī)期間，香港房主在虧本情況下也在堅(jiān)持還房貸?！眴蝹ソū硎??！皹O少有贖回的案例，而在亞洲其他地區(qū)出現(xiàn)了贖回潮，市場(chǎng)上涌入了大量房子?！?/p>

第四個(gè)保障措施在于中國(guó)限制擁有多套住宅?！斑@意味著中國(guó)家庭的風(fēng)險(xiǎn)暴露低得多，不會(huì)滿足剛需后去買度假屋，再買一套投資?！彼f(shuō)。單偉建總結(jié)稱，即使房?jī)r(jià)下跌30%，對(duì)銀行系統(tǒng)幾乎構(gòu)不成威脅。不過(guò)他也警告，房?jī)r(jià)下跌也有后遺癥，主要會(huì)影響“財(cái)富效應(yīng)”。 “如果房?jī)r(jià)下跌，消費(fèi)者感覺(jué)變窮，消費(fèi)會(huì)減少，經(jīng)濟(jì)增長(zhǎng)將受影響。”他說(shuō)。

下注中國(guó)消費(fèi)者

毫不奇怪，單偉建最中意的投資領(lǐng)域是消費(fèi)品和服務(wù)，他認(rèn)為這些領(lǐng)域代表了中國(guó)的未來(lái)，而不是曾經(jīng)推動(dòng)中國(guó)崛起的重工業(yè)領(lǐng)域?！拔覀冏羁春玫氖轻t(yī)療、醫(yī)藥、專業(yè)金融，還有食品飲料領(lǐng)域。”他表示。“畢竟中國(guó)有14億消費(fèi)者，每年的消費(fèi)越來(lái)越多，儲(chǔ)蓄越來(lái)越少。”

太盟投資在音樂(lè)領(lǐng)域獲得了巨大成功。單偉建解釋說(shuō)，大概五年前，太盟投資向中國(guó)音樂(lè)集團(tuán)投資了1億美元，多年來(lái)該公司不斷買入或授權(quán)音樂(lè)版權(quán)，幾乎囊括中國(guó)所有流行音樂(lè)，也包括進(jìn)入中國(guó)市場(chǎng)的西方音樂(lè)。

但他表示，中國(guó)政府強(qiáng)力推行法律保護(hù)本土知識(shí)產(chǎn)權(quán)，法院執(zhí)行方面也大力加強(qiáng)。而且，音樂(lè)愛(ài)好者也開始拒絕盜版商制作音質(zhì)低劣的音樂(lè)。

2018年12月中旬，中國(guó)音樂(lè)集團(tuán)與QQ音樂(lè)合并后的騰訊音樂(lè)娛樂(lè)集團(tuán)在美國(guó)納斯達(dá)克上市，目前市值260億美元左右。太盟投資持有的股份價(jià)值數(shù)十億美元?！拔覀兠吭掠?億獨(dú)立用戶?！眴蝹ソū硎?。他表示，騰訊音樂(lè)發(fā)展的故事集中體現(xiàn)了中國(guó)如何由世界工廠轉(zhuǎn)變?yōu)槭澜缡袌?chǎng)。他說(shuō)，完全開放市場(chǎng)不僅對(duì)中國(guó)消費(fèi)者有利，也可以重振面臨困境的貿(mào)易伙伴關(guān)系，過(guò)去貿(mào)易合作推動(dòng)了中國(guó)發(fā)展，未來(lái)也是關(guān)鍵。（財(cái)富中文網(wǎng)）

譯者：馮豐

審校：夏林

If you want to understand where China is heading, the best guide may be private equity veteran Weijian Shan. His take on his country’s current economic predicament: Its slowdown has only just begun, but its long-term health looks sound.

Shan’s perspective is so valuable because he views his homeland’s economy from three contrasting vantage points that few, if any, experts can match: As an on-the-ground dealmaker in his role as chief of PAG, Asia’s largest private equity firm; as a U.S.-trained, PhD economist; and as a figure whose personal story followed his nation’s rise, from the brutal oppression that exiled him into forced labor during the Cultural Revolution to the economic miracle that enabled him to bring billions of dollars in gains to his investors.

On a Tuesday evening in late January, I met Shan at a modest cafe on Manhattan’s Upper West Side. Shan––who later mentioned he was attending a board meeting by phone later that evening––ordered a cup of hot water.

Though he lives and works in Hong Kong, Shan was in town to promote his new book, Out of the Gobi: My Story of China and America. It chronicles the nightmare of being torn from his family in Beijing as a teenager in 1969 and sent to the Gobi Desert, where he toiled as a laborer for six years. Shan relates how China’s liberalization under Deng Xiaoping enabled him to join the first generation dispatched by the government to study in the U.S.

Shan earned a doctorate in international business at U.C. Berkeley, where he wrote his PhD thesis under the tutelage of future Federal Reserve chair Janet Yellen, then joined the faculty at the Wharton School. The book’s epilogue is a heartbreaking account of his return the crumbling, abandoned barracks where he once toiled as a “barefoot doctor,” one of a cadre of rural Chinese given basic medical training to treat minor illnesses. He encountered old friends who turned to pig farming because they could no longer scratch a living from the parched soil. “We had spent so much of our youth battling nature to turn this land into arable farms,” he writes. “Eventually, nature prevailed and took it back.” This final chapter is a eulogy for his comrades, victims of the notorious “Cultural Revolution’ who “had been denied a future, wasting their best years when they should have been in school. For what?”

The end of an era in China

Out of the Gobi doesn’t encompass the business career that took him back to his homeland, but in our conversation, Shan noted that his ultimate ambition was to help provide the capital to build private enterprise in China and other Asian countries. After a five-year stint with J.P. Morgan in Hong Kong, he joined private equity colossus TPG in 1998. He spent the next 12 years at TPG, then in 2010 co-founded PAG, where he serves as chairman and CEO. He has built that firm into a giant with $30 billion in capital under management.

Shan is full of praise for China’s ascent over the past two decades, but he warns that the era of epic growth is ending. His observations blend what he sees in the C-suites in Shanghai and Beijing with his insights as an economist. “I wouldn’t be surprised if GDP falls to 6% in 2019,” he says, a rate below last year’s already disappointing 6.6%, one of the lowest readings since 1990.

Shan reckons that two short-term forces are contributing to the current softness, but cautions that it’s the durable, secular shift away from fast-expanding manufacturing that ensures that China will jog rather than sprint in the future.

The first of two immediate problems, he says, is a severe contraction in credit. “Two years ago, the government started cracking down on the ‘shadow banking’ network that provided most of the credit to the private sector,” he says, adding that private enterprise is dominated by small and medium-sized businesses (SMEs) in China. Beijing was worried that trust companies and other lenders in the “shadow” system were dangerously over-extended, and the motley group might crash, hobbling the economy.

At the same time, the government tried to ensure that the state-controlled banks kept credit flowing by dictating that they target at least 50% of their lending to SMEs. “But the big banks didn’t want to lend to private companies because they’re riskier credits,” says Shan. “They always wanted to loan money to the big state-owned enterprises, [SOEs] because they’re backed by the government, and totally safe.” Because the banks resisted, he says, “the quotas didn’t work.” His view: The private sector isn’t getting the bank financing it needs for new plants, medical facilities and stores––a phenomenon that’s now slowing the economy.

The second deadweight is the trade dispute with the U.S. “The direct impact on business is small,” he says. “But the impact on business confidence is large. The dispute is hitting confidence among Chinese producers, and discouraging them from investing.”

To help resolve the conflict, says Shan, China should lower its tariffs on U.S. imports, and lift barriers to U.S. ownership of Chinese companies. “That would lower prices to consumers on cars, cell phones and other U.S. imports, and also force Chinese rivals to become more competitive,” he says. “Making those products cheaper would give consumers more money to spend on other products, on appliances or groceries. And that would help growth. Since China is becoming much more of a consumer society, it’s getting more and more important to promote competition and efficiency in what’s now the bulk of the economy.”

Less manufacturing, slower growth

Indeed, says Shan, China’s shift from a manufacturing to consumer-led economy is what will inevitably slow its future growth. China’s economic destiny is being dictated by its demographics. It’s long been clear that the “one-child policy” would eventually constrict China’s workforce. (That policy was ended in 2015.)

For Shan, that problem was alleviated, and masked, by the giant migration from rural areas to the cities. “Exactly fifty years ago, when I was sent to the Gobi, China began the greatest ‘ruralization’ in human history,” says Shan. “Out of 160 million people living in cities, 16 million were sent to farms and barren areas. For the past twenty years, we’ve seen the greatest urbanization in human history. It’s that migration of peasants and farmers to urban factories that drove China’s industrialization.”

That trend, he now warns, has peaked. “China is now facing a tight supply of workers that’s driving up labor costs,” he says. “Labor costs have risen 11% a year for the past decade, while prices of the exports China manufactures are flat or declining. That’s why China is now losing exports to other Asian nations such as Vietnam and Indonesia.”

Chinese industry was once hungry for investment, and the Chinese, faced with a meagre choice of consumer goods at home, saved most of their incomes. Those savings swelled the bank deposits that funded China’s mighty rise in manufacturing. Those days are over. Today, a much bigger share of workers’ paychecks are going to Nike sneakers, fancy foods, and vacations in Hong Kong or Paris. “The old model of saving to invest no longer works,” says Shan. He points out that ten years ago, exports, a proxy for manufacturing, accounted for 36% of GDP and consumption 35%. Over that span, exports have dropped to 19% of national income, and consumption has jumped to 50%.

A nation driven by heavy investment in manufacturing is a lot more dynamic than an economy dominated by consumer spending, says Shan. “Private consumption produces lower growth than than manufacturing investment,” he notes. He explains that a growing industrial base creates a “multiplier effect.” Each trillion yuan in invested in a new factories contributes far more than that in economic growth by creating new jobs and still more factories to supply components and power. “Conversely,” says Shan, “consumption spending doesn’t provide a multiplier. It doesn’t provide the impetus for growth that investment in manufacturing does.”

Shan’s conclusion: The historic shift from manufacturing to consumption is bound to slow China’s future expansion. He adds, however, that China still has lots of room to improve its growth profile by downsizing the state-owned sector, and further encouraging expansion of private industry. And those sources of efficiency will be needed simply to sustain current levels of growth.

What about predictions that Beijing will enact a big stimulus package to re-ignite growth? Shan doesn’t think it will happen. “China certainly has the capacity to do it,” he says. “Its finances are in better shape than any other major economy. The central government’s debt to GDP ratio is just 17%, it has $3 trillion in foreign exchange reserves, and foreigners own a tiny amount of its sovereign debt.” But he predicts that the government will avoid opening the monetary floodgates. The policies of the past two years, he says, are specifically aimed at curbing what Beijing viewed as excess leverage for both consumers and businesses, potentially creating asset bubbles that once exploded, could sink the economy. For Shan, the government views the risks of excess credit as more damaging than the drag on growth from restricting credit.

A real estate bubble? Not likely

Some concerns about China center on the rapid escalation in prices for housing and other real estate, and the possibly disastrous aftershocks if prices fall sharply. Shan sees those fears as overblown: He doesn’t see a replay of the U.S. financial crisis of 2008 to 2010, or the Asian collapse in the 1997 and 1998.

“Both [those crises] were caused by a collapse in real estate, but the key is that the real estate collapse wrecked the banking system, causing a credit crunch that led to deep recessions,” says Shan. “In the late ’90s, hundreds of Asian banks failed; we [at TPG] bought several of them.” The difference, he continues, is that Chinese federal laws and banking guidelines have limited leverage in the real estate market, limiting the danger to the banks.

He lists four reasons that real estate isn’t dangerously leveraged, and hence why the banking system is well protected. “First, the banks will lend no more than 70% to 80% of the purchase price,” he says, “meaning the homebuyer has substantial equity. Second, prices have risen a lot, and existing homeowners have already paid down part of their loans, so their equity across the economy is more like 50%.”

A third factor: The Chinese are personally liable for the entire amount of their home loans. They can’t walk away if they face foreclosure, as millions of Americans did in the financial crisis. “In the Asian financial crisis, for example, homeowners in Hong Kong kept paying even when they were under-water,” says Shan. “There were few foreclosures, while in other parts of Asia, foreclosures flooded the market with homes.”

A fourth safeguard arises from the widespread restriction on owning more than one home. “That means the Chinese families are a lot less exposed than if they owned a main house, but also a vacation home and another place for investment,” he says. All told, Shan concludes that even if housing prices dropped 30%, that scenario would still would pose little threat to the banking system. Such a fall, he cautions, would still leave a big hangover– in the form of the “wealth effect.” “If housing prices fall and consumers feel a lot poorer, they’ll spend a lot less, and growth will falter,” he says.

Betting on Chinese consumers

Its hardly surprising that Shan’s favorite sector for investing is consumer products and services that he says are China’s future, rather than the heavy industry that once defined its incredible ascent. “We see the best opportunities in health care, pharmaceuticals, specialty finance, and food and beverage,” he says. “We’re talking about 1.4 billion consumers who are consuming more and saving less every year.”

PAG just scored a spectacular success in music. Shan explains that about just five years ago, PAG made a $100 million investment in China Music Corp, a company that for years was either buying up or licensing virtually every pop music copyright it could in China, and also for Western music targeting the Chinese market. “Those copyrights and licenses were selling for peanuts,” says Shan. “That’s because ten years ago there was so much pirating and illegal copying of music, that the copyright protections were almost worthless.”

But over time, he says, the government enacted strong new laws shielding China’s intellectual property, and the courts greatly improved enforcement. To boot, music lovers began shunning scratchy-sounding copies made by the pirating shops.

In mid-December 2018, Tencent Music Entertainment, created from a merger of China Music and QQ Music, went public on the Nasdaq, and now carries a market value of $26 billion. PAG’s holdings are worth a few billion dollars. “We have 800 million unique monthly users,” says Shan. The Tencent Music story, he says, epitomizes what he calls China’s shift from the world’s factory to the world’s market. Fully opening that market, says Shan, would both benefit the Chinese consumer, and reinvigorate the now-endangered trading partnerships that so enriched its past and are so crucial to its future.