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China Briefings

Reports on China issued by Samsung Economic Research Institute

China Business Intelligence No. 91

China Business Intelligence No. 91

Samsung Economic Research Institute Beijing Office

Oct. 22, 2008

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I. Economy

China's real estate market is showing a sign of bubble burst. The market, of which the bubble began to form in 2003 by speculative forces, showed a more rapid rise in 2007. But housing prices have been clearly slowing down from late 2007. As of 2008, the price-to-income ratio (PIR) is significantly higher in China than other countries. Furthermore, Chinese stock markets have nosedived this year. As foreign capital withdraws from China's real estate market and China's economic growth is expected to slow down, China's real estate prices are likely to continue to drop in the future. China's future real estate market will depend on the government's effective policy.

II. Industry

The future of portable wireless Internet devices depends largely on its technological development. When compared with notebook PCs, smart phones and PSP game consoles, portable wireless Internet devices still have higher prices and limited functionality. Portable wireless Internet devices also have technological problems in standby time, resolution, and hardware configuration. Despite the growing pains, portable wireless Internet devices nonetheless have promising growth potential as a niche market going forward, and this is especially true given the shortcomings of existing notebook PCs, smart phones, and PDAs accessing the wireless Internet.

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