As far as trade is concerned, Asian internal trade (exports), excluding China, increased from 25.2% to
a meagre 26.4% from 1996-2001 to 2005-06; & in case of imports, from 24.4% to 26.5% for the same time period. Even China’s share in exports with countries like Japan, Hong Kong, South Korea & Singapore has decreased over a period over 10 years from 1996 to 2006. Since China has over the years replaced a number of emerging market economies in the markets of advanced industrial countries, China has a very crucial place in the world economy & exercises a significant influence on global trade. As evident from the graph (below right), China’s trade with the US & the EU has grown phenomenally, so has the deficit of these countries (which China shrewdly achieved by keeping its currency pegged to the US dollar).
After much coercion
from the yankees, China allowed their currency to appreciate. Did it work? Last year, the US ran a trade deficit of $230 billion with China (and an overall deficit of $800 odd billion). Horrifyingly, despite the currency juggling, according to the recent data available, the US deficit with China has already reached $76.3 billion in this year till April, 18.5% more than the corresponding period of the previous year. Same is the case with the European Union. Figures show that EU’s trade deficit is on course to reach €170 billion this year. On the other hand, China had a global trade surplus in the month of May of $22.4 billion – 73% up from May 2006. According to the estimates of Mark Williams, analyst with Capital Economics, China is on course to have a surplus of $320 billion in 2007.
For Complete IIPM Article, Click on IIPM Article
Source: IIPM Editorial, 2006
a meagre 26.4% from 1996-2001 to 2005-06; & in case of imports, from 24.4% to 26.5% for the same time period. Even China’s share in exports with countries like Japan, Hong Kong, South Korea & Singapore has decreased over a period over 10 years from 1996 to 2006. Since China has over the years replaced a number of emerging market economies in the markets of advanced industrial countries, China has a very crucial place in the world economy & exercises a significant influence on global trade. As evident from the graph (below right), China’s trade with the US & the EU has grown phenomenally, so has the deficit of these countries (which China shrewdly achieved by keeping its currency pegged to the US dollar).After much coercion
from the yankees, China allowed their currency to appreciate. Did it work? Last year, the US ran a trade deficit of $230 billion with China (and an overall deficit of $800 odd billion). Horrifyingly, despite the currency juggling, according to the recent data available, the US deficit with China has already reached $76.3 billion in this year till April, 18.5% more than the corresponding period of the previous year. Same is the case with the European Union. Figures show that EU’s trade deficit is on course to reach €170 billion this year. On the other hand, China had a global trade surplus in the month of May of $22.4 billion – 73% up from May 2006. According to the estimates of Mark Williams, analyst with Capital Economics, China is on course to have a surplus of $320 billion in 2007.For Complete IIPM Article, Click on IIPM Article
Source: IIPM Editorial, 2006
