February 21, 2012
Victor Mac Diarmid
Geopoliticalmonitor.com
Amidst the long darkness of the so-called ‘Great Recession,’ China has been one of the global economy’s few bright lights. So successfully has Beijing weathered the current economic storm, that many in the West are hoping that China can be the engine of global demand that propels a global economic recovery. Hopes that China can provide the impetus for a global economic resurgence are predicated on a profound misunderstanding of the intrinsic contradictions of the Chinese economy, however.
The Chinese government, pundits argue, learned the lessons of 2008 when America’s economic freefall subsequent to the Great Financial Crisis and Europe’s persistent economic malaise robbed China of its biggest and most secure export markets. The ensuing global economic collapse precipitated a 10.7% decrease in world trade volume in 2009 and slashed China’s annual exports from 26% annual growth to 27% contraction. Not surprisingly, the Chinese economy experienced its lowest period of growth in decades and only a huge fiscal stimulus package saved China from following the industrialized west into a profound slump.
Now, Beijing is looking inward – in accordance with the expert consensus on China’s economic imperatives. It has thus begun a massive program to reorient the Chinese economy away from its perilous over-dependence on foreign investment and exports. Most importantly, it has embarked on a program to energize China’s moribund domestic consumer demand by investing heavily in the domestic economy.
Read the full article here: http://www.geopoliticalmonitor.com/chinas-economic-quandary-4622
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Tuesday, 21 February 2012
China’s Economic Quandary
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