A tale of two economies: China's painful transition

While China's tech successes have captured the imagination of the world, ordinary Chinese feel squeezed by a slowdown that refuses to lift.

- Tan Dawn Wei

Deflation - a symptom of weak domestic demand - has crept into China's consumer prices. In many cities, restaurants have quietly trimmed staff, while retailers offer steep discounts. ST PHOTO: TAN DAWN WEI

(ST PHOTO: TAN DAWN WEI)

When The Place opened in Beijing's Central Business District in 2007 ahead of the Summer Olympics held in the city, the landmark shopping mall boasted Asia's largest LED sky screen and was the epitome of China's consumer boom where brands like Zara, Adidas and Aldo drew crowds eager for foreign goods.

But as I walked through the sprawling commercial development recently, the vibe was markedly different than even just six months ago when I left Beijing. Storefronts like Sephora and Calzedonia sit shuttered, foot traffic has dwindled and the LED canopy no longer dazzled shoppers.

Next door, luxury mall Parkview Green is also in trouble. On a weekday evening, the iconic high-end shopping complex, famous for its display of an impressive collection of artwork, was a ghost town. Its owner, Hong Kong-based Parkview Group, has been trying to sell the property since last year, saddled by low occupancy rates and high mortgage payments.

If you were to judge China's economic pulse by its tech ambitions alone, you would hardly expect this scene. From the outside, China appears to be roaring into a new era of industrial strength.

(Tan Dawn Wei Senior Columnist)