Macau, the world’s largest gambling hub, reported surprisingly slow revenue growth in January--the slowest since October 2012. Was it the result of the Lunar New Year falling during the month this year, or a further indication that China’s economy is slowing? Heard on the Street columnists Alex Frangos, Abheek Bhattacharya and Aaron Back weigh in.

THE greatest risk to Australia’s future security is a combination of China’s frightening economic growth and the possible withdrawal from the region of a weakened United States.

A new discussion paper from the government-funded Australian Strategic Policy Institute (ASPI) out today says such a scenario would make Australia more vulnerable to “foreign aggression’’ than at any time since 1942.

Written by eminent American global economist David H Hale the paper entitled “China’s New Dream’’ provides a snapshot of China’s economic miracle and its ability to flex its new found muscles.

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It doesn’t name China as a possible aggressor, but paints a worrying picture of the communist country’s amazing growth and its willingness to use growing military might to achieve its aims.

“The re-emergence of China as a great power will be Australia’s greatest foreign policy challenge during the 21st century,’’ it says.

“Canberra will have to carefully balance Australia’s growing economic relationship with China and its traditional alliance with the US. The major threat to this balancing act would be if America’s fiscal problems forced it to slash defence spending and withdraw from the East Asian region.’’

Mr Dale said the only Asian country with the potential to offset China’s growth was India.

“Australia should therefore hedge its bets with the US and China by pursuing better relations with New Delhi,” he said.

In 2012 Chinese defence spending grew to an estimated $US166.2 billion compared to $US22.2 billion in 2000 and second only to the US at $660 billion.

CHINA: A GROWING POWER Defence spending was US$166.2 billion in 2012 compared to $22.2 billion in 2000. Second only to the US. Produces twice as many cars as the US. In 2012 it built 19.27 million vehicles, compared to 10.3 million in the US, 9.9 million in Japan, 5.6 million in Germany and 4.6 million in Korea. Consumes over half the world's semiconductor output and produces 75% of global output of mobile phones, 87% of personal computers and 52% of colour televisions. The leading trade partner for 124 countries, compared to 76 for the US. Inward foreign direct investment has risen to $832 billion. Only the US, France and the UK have more. Has $3.7 trillion of foreign exchange reserves, the largest in the world. Japan is next, with $1.3 trillion. Had 122 billionaires in 2013, compared to 422 in the US, 110 in Russia, 39 in Hong Kong and 26 in Taiwan.

“China’s made claims over much of the South China Sea, provoking border disputes with Vietnam and the Philippines,’’ the paper says.

“In November 2013, China announced the creation of an air defence identification zone over the East China Sea.’’

Mr Hale said the greatest risk from Chinese aggression was a military accident.

“Such an event could provoke an escalation of tensions and create fears of a war.’’

China is the leading trade partner for 124 countries, compared to 76 for the US and its stock of inward foreign direct investment (FDI) has risen to $US832 billion.

It has the largest foreign exchange reserve of $US3.7 trillion followed by Japan with $US1.3 trillion.

China had 122 billionaires in 2013 compared to 422 in the US, 110 in Russia, 39 in Hong Kong and 26 in Taiwan.

It is the world’s largest manufacturing nation and in 2012 China built 19.27 million vehicles up from just 2.1 million in the year 2000.

That year the US built 10.5 million vehicles, Japan 9.9 million, Germany 5.6 million Korea 4.6 million.

China also accounts for 28.8 per cent of global sales for Volkswagen, 28.9 for General Motors, 20.9 for Nissan, 19.5 for Hyundai, 17.7 for Kia, 17.1 for Honda, 14.8 for Peugeot, 13.8 for Mazda, 8.4 for Ford, 8.0 for BMW and 7.6 per cent for Toyota.

It also produces 75 per cent of global output of mobile phones, 87 per cent of personal computers and 52 per cent of colour televisions.