Monday, April 11, 2011
China reports first quarterly trade deficit in six years
China first time in six years reported quarterly trade deficit of $1.02 billion. It looks like the Chinese government is introducing some reforms to its export oriented economy in order to boost domestic consumption in the next five years. Starting this year, China launched its 12th five year plan of its transition toward market economy. China is also planning to slow its economic growth down a bit from the present double digit growth rate to 7 percent.
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3 comments:
this could be good for the domestic market as China intentionally tries to slow their economy. it is interesting that they still are taking baby steps toward transition, but with the progress that they have made over the years it seems like they know what they are doing. however since their economy is so large and spread out it may be a long delay between the policies that are imposed and the results that are meant to emerge from these policies.
How much has the push for a revaluation in their currency hurt the Chinese economy? i know people who are less inclined to buy from China in just a silent support of America.
Also, there has been a huge change from outsourcing to Chinese factories to now outsourcing to South Asia. This would definitely hurt Chinese exporting.
I think the slow transition of China is a good thing. As I learned from "Globalization and its Discontents" by Stiglitz privatization and liberalization can have catastrophic results if rushed.
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