open.jpgYes, it has been a long time. A very long time. But EngagingChina is back in business.

But should western businesses still be interested in China? After all, the Olympic games have passed, the Shanghai stock exchange dropped 65% in 2008, and Chinese exports plunged 17% last month, the largest fall in seven years. Maybe I won't need those Mandarin lessons after all.

Yet with much of the developed world now mired in recession, the importance of China is, if anything, much greater than it was a few years ago, when those breathlessly optimistic articles and books on China's economy were written.

Before, the fear of many western businesses and political leaders was that China would grow too powerful, too fast — while EngagingChina was away, China overtook Germany to become the third largest economy.

Today, the fear is that China may not grow fast enough to mitigate the global slump, thus prolonging the agony for the west. In 2008, China's economy grew at an annual rate of just 9% the first time it has come in below double digits for the first time in five years.

China's political leaders are confident that GDP growth will not drop below 8% this year after pushing through a stimulus package last November. That, they say, will ensure that China recovers from the global slump long before its peers.

Western economists are not so sure that the 8% goal can be met unless China also re balances its economy away from exports and heavy industry and encourages investment in domestic consumption and areas like education. If not, they forecast more factory closures and growing social unrest as western customers cut orders for China's traditional export industries and GDP growth falls further.

China is at a turning point and while the past few years have seen the first tentative signs of China's new economy emerging, the next few are going to accelerate the transition. We will keep you posted.