John At The Center

The property market will probably weaken because the government has signaled that it wants prices to fall, billionaire Zong Qinghou, the chairman of Hangzhou Wahaha Group Co., said March 3.

China may struggle to fix economic imbalances because key leaders are nearing the end of their tenures and vested interests can block measures such as a property tax that could help to wean local governments from dependence on land sales and taxes on industrial production.

‘Election Mode’

“China’s in severe election mode,” said Jim McGregor, a senior counselor in Beijing at APCO Worldwide, a public-affairs group advising clients including China Cosco Holdings Co., Asia’s biggest shipping company. “They have 2 1/2 years left in their term,” he said before the meeting. There is “a lot of jockeying for position.”

Wen has said China’s growth model is unbalanced and unsustainable.

via China to Cut Infrastructure Spending, Aims to Spur Consumption – BusinessWeek.