Will Chinese economy collapse?
- By Mei Xinyu
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E-mail China.org.cn, September 6, 2015
Comparing with major economies and other emerging market economies, the growth speed of Chinese economy is still high. U.S. annual economic growth has not touched 3 percent in recent years -- it was 1.6 percent in 2011, 2.3 percent in 2012, 2.2 percent in 2013 and 2.4 percent in 2014. The annualized growth rate of the first two quarters in 2015 reached 0.6 percent and 2.3 percent, respectively. Thus, if the U.S.'s rate of growth can be considered as "robust", how can we say China's 7 percent be "worrisome," or even suggesting "collapse?"
This also applies in foreign trade. Chinese foreign trade growth can't compare with the past, which is not due to domestic reasons, but rather the result of the deceleration of the world economy. The hyper-globalization era worldwide is gone. Chinese foreign trade cannot be expected to maintain high growth while the world economy is declining.
According to CPB Netherlands Bureau for Economic Policy Analysis, the total volume of world trade declined 0.5 percent in Q2, the lowest since 2009. The growth of the total volume of world trade shrank 1.5 percent in Q1, also the lowest since 2009. In the first quarter, Chinese exports dropped 2.7 percent, while America fell 7.1 percent, Japan declined by 3.5 percent, and India's overall import-export tally was down 20 percent.
In recent years, large-scale economic fluctuations have hit almost all emerging market economies, including China. However, as the world's greatest manufacturing power, China has enjoyed a trade surplus ever since 1990. China's economic fundamentals are totally different from that of other primary exporting countries, which prevent China facing the sort of economic collapse happening in other emerging markets.
As for debt and other problems, the Chinese economy is also better than major economies and other emerging markets.
The writer is a researcher with the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce.
The article was written in Chinese and translated by Lin Liyao.
Opinion articles reflect the views of their authors only, not necessarily those of China.org.cn.
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