Northern Country

How globalization changes capitalism, the economy and politics

Posts Tagged ‘China

China – Same old same old

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We are back to the old China story. It seems almost as if China is the only hope for world economy to recover, but that cannot be true either. The country is a net exporter and a still pretty low income structure cannot contribute much to a recovery on a global perspective. That job is still firmly in the hands of the US, and its not looking too good.

Nevertheless growth in China is impressive and has remained far ahead of the US and Europe where output is in deep contraction. Louis Kuijs, Senior Economist for World Bank, thinks it is too early to say if China’s economy has really bottomed out but growth will remain respectable. According to Michale Buchanan, Managing Director and Chief Asia Pacific Economist, Goldman Sachs, China’s economy will recover faster than other countries because of a limited impact of the financial crisis.

China’s first-quarter GDP grew 6.1 percent over the previous year, which may be a strong performance in the global context but is the lowest rate for China in many years. China’s urban fixed-asset investment in the first five months rose 32.9 percent year on year. However, the robust growth was mainly a result of investment on government-sponsored infrastructure projects.

The sequential growth rate quarter over quarter is very strong and in the moment it looks like a V-shaped recovery is on its way. In the end it will be up to its western trading partners how fast the global economy will be able to recover. Even in China exports are down almost 30 percent compared to last year, shrinking for the sixth consecutive time in May. 

Written by Alfred

15. June 2009 at 9:44 am

Shrinking capital – FDI in China down

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Foreign direct investment in China is down 20.4%  year on year in the first five month of 2009. Only 34.05 billion US dollar poured into the country from January to May this year. In May alone FDI is down 17.8% at 6.38 billion dollar. This is its eighth straight monthly fall.

Written by Alfred

15. June 2009 at 9:17 am

Posted in Capital Markets

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