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But developing in China can be fraught with obstacles. In 2005, the Simon Property Group , the largest shopping center owner and operator in the United States, announced with some fanfare that it would begin developing malls with two partners. Four malls were built in so-called second-tier cities, like Hangzhou, which has 5.5 million people according to its municipal Web site. But in 2009 — before three of the malls had opened — Simon sold its interest and left China. The company told analysts that the cities lacked enough middle-income consumers to make the centers profitable.
Am I describing Japan at the end of the 1980s? Or am I describing America in 2007? I could be. But right now I’m talking about China, which is emerging as another danger spot in a world economy that really, really doesn’t need this right now. I’ve been reluctant to weigh in on the Chinese situation, in part because it’s so hard to know what’s really happening. All economic statistics are best seen as a peculiarly boring form of science fiction, but China’s numbers are more fictional than most.