Steve Chiotakis: Over to China, where the economy is growing at a brisk 9 percent. But is that enough to help pull the rest of the world out of a recession? Some Chinese investors say no.
From Shanghai, Marketplace’s Rob Schmitz reports.
Rob Schmitz: It’s called “The China Venture Capitalist Confidence Index,” and in its six-year history, confidence has never been lower.
University of San Francisco’s Mark Cannice says venture capitalists usually spend money on innovative companies.
Mark Cannice: But ultimately, it’s very reliant on the fact that venture capitalists can sell those companies they helped create into public markets or through acquisition.
Problem is, the global economic crisis means there are fewer buyers. Last year, venture capitalists invested $4 billion into hundreds of deals in China. But responses to this survey show that economic turmoil in the E.U. and the U.S. have weighed heavily on the Chinese. They’re even losing confidence in China’s economy.
Cannice says all this pessimism means investors in China will likely hold onto their money.
Cannice: This means that there will be somewhat less innovation, somewhat fewer companies that are providing the necessary products and services and also ultimately, there will be somewhat less employment than we would otherwise have.
Which is no way to pull the rest of world out of a global downturn.
In Shanghai, I’m Rob Schmitz, for Marketplace.
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