This website uses cookies to ensure you have the best experience. Learn more

China's Growth Likely To Taper Off

690 words - 3 pages

Though China's economy is surging ahead with almost all economic indicators favouring the current economic situation, it is not likely to continue with the same momentum that it had been expected. True, China's economy continued to forge ahead in May on the back of strong domestic and external demand, with both investment and consumption climbing at double digit rates. Inflation also moved higher. While the recent spate of wage hikes on China would exert upward pressure on prices in the longer term if there is no corresponding increase in productivity. The consumer price inflation is expected to decelerate in the coming months as food and world commodity prices show signs of easing.

It is true that there has been a persistent surge of the China's exports in May amid growing uncertainty in the European economy also raised hopes that the potential impact of the European debt crisis on global trade might be less severe than expected. ...view middle of the document...

83 to the, US dollar since mid-2008 in an attempt to cushion its economy from the global financial crisis.

It is expected that under the new arrangement, there is likely to be more day-to-day volatility in the US dollar-RMB exchange rate. It also implies that the RMB could appreciate or depreciate against the US dollar. Despite the change, however, The Stitch Times had forecast that the RMB would gradually appreciate, reaching around 6.65 versus the US dollar by the end of this year, or an appreciation of about 2% from its current level.

The internal economy of China is strong and its economy continued to forge ahead in May. Domestically, fixed asset investment in urban areas climbed 25.41% in May after rising by the same rate in April, while the retail sales of consumer goods gained 18.7%, slightly faster than the 18.5% growth of the previous month. Inflation also rose with consumer prices jumping 3.1 % in May after increasing 2.8% in April. In the first five months, consumer prices rose 2.5%, of which over 90% was due to increases in food and housing-related prices.

Export Growth Likely to Decline

There is no immediate threat to growth pace of Chinese exports. The persistent strength of external demand amid growing uncertainty in the European economy was all the more impressive. In May, mainland China's exports grew at a faster pace of 48.5% after rising 30.5% in April and 28.7% in the first quarter. In the first five months, China's exports grew 33.2% compared with a contraction of 16.0% for the whole of 2009. During the period, exports to the European Union (EU) climbed 34.4% compared with the 24.8% growth recorded for exports to US.

While, strong exports by China raised hopes that the potential impact of the European debt crisis on the global economy might be less severe than expected. But this not take in to account the fact that the debt crisis in Europe only began to deepen in the second quarter implying that its impact on the global trade will not be felt until later this year. With Europe being the Chinas biggest market absorbing over one-fifth of its total exports, any noticeable slowdown in Europe's imports could have a substantial impact on the Mainland's export sector.

Other Papers Like China's Growth Likely to Taper Off

Poverty In China Essay

1125 words - 5 pages line of $1.25 a day. China's rural poverty line is 2,300 Yuan a year, or 6.3 Yuan a day. At today’s trade rates that is just about $1.03, which would appear to be much meaner than the World Bank's line of $1.25. Anyhow the Bank's destitution line is computed at buying force equality trade rates, not market trade rates. To the World Bank, somebody is experiencing great neediness on the off chance that they expend short of what $1.25 could

Pestle Summary China Essay

657 words - 3 pages the case that misgovernance will prove to be the root cause of a downward spiral that will cost China dearly. It will mark the end of an unprecedented run of growth and opportunity that began in 1978, and for the past 25 years it has averaged 10% growth per year. The record stops this year, sadly. It really is a pity--China's growth has done more to reduce world poverty than any program, aid initiative or growth in the rest of the world combined

Dr. Pepper Snapple Group, Inc

1100 words - 5 pages beverage industry is forecast to shrink to ¼ it’s current rate over the next five years—beginning to plateau. • Market penetration is a concern as they’re going against established brand names. • May not be able to wrestle away market share within an industry that has begun to taper off. • Lower price margin – Larger packaging sizes that have lower price per ounce • Monopoly (Red-Bull) Entry Mode: 1. Play it safe, stay out

China Renewable Energy

3734 words - 15 pages ://www.nytimes.com/2009/05/11/world/asia/11coal.html 5. Usfunds, Coal Use in China Shines Light on Growth, May 02, 2011, http://www.usfunds.com/investor-resources/frank-talk/?i=5545&CFID=4236481&CFTOKEN=97689128 Nuclear power in China Mainland China has 14 nuclear power reactors in operation, more than 25 under construction, and more about to start construction soon. Most of mainland China's electricity is produced from fossil fuels (80

From The Perspective Of Economic Models For Free Tickets To Scenic Spots Economic Phenomena In China

1151 words - 5 pages From the perspective of economic models for free tickets to scenic spots economic phenomena in China Yawen Wang EC 601 Microeconomics and Macroeconomics Dr. Esin Cakan March 16,2014 Abstract: Since 2000, as part of the national scenic area to the right of the fare directly delegated to the local development of China's scenic fares

China's Trade Surplus

1979 words - 8 pages . | [Abstract]: China's international payments imbalance is increasingly cause for concern. China's international balance of payments surplus in the long-term lead to excessive growth of China's foreign exchange reserves, making the hedge foreign exchange reserves caused by excessive proliferation of liquidity into the monetary policy is now one of the important tasks. Therefore, our analysis of the

Chinese-Us Relations

1657 words - 7 pages Since the end of the Second World War, the relationship between the United States and China has been dominated by intermittent periods of stability and tension. However, many contemporary international relations analysts now believe that conflict with China is inevitable. John J. Mearsheimer posits his belief that “If China continues its impressive economic growth over the next few decades, the United States and China are likely to engage in an

Discussion2

823 words - 4 pages 1. To find and discuss quantitative information concerning the economy--for example, term structure of interest rates, GDP growth, inflation, etc. In inflation news, Ben Bernanke, the Federal Reserve Chairman, expects the monthly $85 billion Quantitative Easing (QE) purchase of assets to taper off by the end of 2013 (“Global Economy”, 2013).The tapering of QE in the United States is causing major concerns because this affects emerging

Currency War and It's Influence for Indonesia

1329 words - 6 pages should. China's rapid economic growth has caused China's trade surplus against its trading partner countries to increase. In the second quarter of 2010, China's economy grew 10.3 percent, from 11.9 percent growth in the previous quarter. However, on the contrary, many Chinese trading partners are experiencing widening trade deficit, including the U.S. In 2009, the U.S. trade balance deficit with China has more than 220 billion U.S. dollars. This

Total Factor Productivity of Beijing ——Based on Data from 1979 to 2013

2063 words - 9 pages 1.Research purposes Generally speaking, there are three main factors that influence economic growth——capital investment, labor and total factor productivity (TFP). Although China has gradually liberalized the one-child policy, but in the short term, China's population growth rate will not increase greatly, while with the increase of China's population aging trend, China's labor population ratio will continue to decline. Therefore, China‘s

Ppf and Economic Growth

1135 words - 5 pages resources, and become the world's first fully industrialised economy. In recent times, China's rapid growth rate owes much to the application of new technology to the manufacturing process. An economy will not be able to grow if an insufficient amount of resources are allocated to capital goods. In fact, because capital depreciates some resources must be allocated to capital goods for an economy to remain at its current size, let alone for it to

Related Essays

Us Gdp Growth Rate Essay

1059 words - 5 pages explain the strength of household spending almost entirely. Unless income grows more strongly, we should expect slowing spending trends over the next few quarters as government stimulus payments to the private sector taper off. The companies increased the value of goods on their warehouse and store shelves by $31 billion in the quarter, contributing 1.6 percentage points to growth due to higher inventories. Should consumer spending slow as

Company Analysis Of China's Top 20 Forklift Producers In 2016

559 words - 3 pages producers. It analyzes China's forklift industry in terms of market information (market size, status, etc.), hotspots (key M&A activity and new policy), current industry trend and the competitive positioning of top 20 companies in the industry. 1)The Aim of this report -To provide readers with comprehensive & in-depth understanding of China's forklift industry; -To disclose market size of China's forklift industry; -To understand position of

Clash Of The Titans Essay

1370 words - 6 pages trends only add to this growing parochialism. Another recent shift has been the renewed centrality of the state. Yasheng Huang, a scholar at MIT, notes that during the 1980s and early 1990s, China's growth was mostly led by the rural, private sector. More recently it has been driven by the urban, public sector. This has empowered the state in the economy, a phenomenon that has accelerated over the past year as China spent 12.3 percent of GDP on

China Facing The Challenge Of Aging Population

1092 words - 5 pages the complete disappearance of the demographic dividend around 2015, China's era of high economic growth that began in the late 1970s will likely come to an end. In this sense, the next decade may be China's last chance to join the ranks of developed countries. November 28, 2006 Box: The realities of the one-child policy Concerning China's family planning policies, the Law on Population and Family Planning adopted in 2001 stipulates that "the