In the world there are so many wanting to see the “collapsed” China they quarrel among themselves, year after year, highlighting different scenarios for its collapse, says Dmitry Kosyrev, political commentator MIA “Russia today”.
The world outside of China reacts in the final here in Beijing for the annual session of the Parliament (the national Assembly of people’s representatives) is quite straightforward: interested, will collapse the Chinese economy in the foreseeable future or not.
And, accordingly, will China continue to save the world’s economy, as it did after the 2008 crisis, or will not fall.
In Beijing understand this question and answer it sometimes in plain text, at press conferences during the session and in the other cases.
GDP is wrong?
Completely separate question: how is the US trying to “contain” China, ideologically or sending in the South China sea the aircraft carriers, and expect that China will be economically strong enough to not cause world catastrophes. That is, China is the US threat and salvation at the same time. This American circus act to describe a long and difficult process.
But in this case it’s not about geopolitics, but about the “pure” Economics — as, for example, the question in the latest publication in the Financial Times, quoting first Deputy Director of the IMF David Lipton. It’s about what the world community faces a “risk of economic collapse” because there were publications about the negative trade statistics of China: falling exports and imports and overall GDP of China last year showed the weakest growth values over the past 25 years.
About the fate of the world in General is a complicated issue, but about their country, Chinese leaders at the session of Parliament say clearly: no collapse does not threaten her. The planned slowdown in 2016 to 6.5 — 7% is not a collapse. It is a long-announced transition to a different model of the economy, when fewer coal and steel (and dismissed this reduced the industry need to make), but more spending on innovation.
What, then, meet the experts, be with Finance problem? The fact that after the crisis of 2008 the first two world economic powers, the US and China, poured a fire of money. But each in his own way.
China, says the one walking now on the world’s media concept, pumped after 2008 the GDP artificially, directing half of public investment in infrastructure.
They built the tower in five days, jealous says one of these authors. They built more than 30 airports, subways in 25 cities, the three longest bridges in the world, more than 10 thousand kilometers of high-speed Railways and 40 thousand miles of conventional highway.
Actually someone could say that money is clearly well spent, as though we were explained that this GDP is wrong and unnecessary. But in the end really domestic debt reached 220% of the GDP. And if to print more money to spare, then the national currency will fall, it will be beneficial for Chinese exports, but other countries will also start reducing their course, followed by a global currency war, and it is here that the world will collapse.
The records will still be
The prosecution, as we see, is serious, and the only problem is that wanting to see the “collapsed” China so much that they quarrel among themselves, year after year highlighting different scenarios of the collapse.
Now let’s see how this “financial” scenario meet Chinese colleagues. Above we quoted from the publication in the Japan Times, now will be the comment of the economist in “people’s daily”. He cited figures from the Agency Standard & Poor’s, according to which in 2016 the Nations of the world will be borrowing total of 6.7 trillion dollars. But 72% of this amount will take not China, and the United States plus Japan, plus the “core economy” of the European Union.
And it does not correlate with their contribution to the world economy or population.
And the BRICS, all together, we intend to borrow only 13% from 6.7 trillion, including China, at 5.1%. It’s a lot, but seven times less than the United States. The China in terms of annual GDP goes after America, that is located on the second (if not first, on other counting systems) in the world. And in addition, China has a very real prospect to grow 2-3 times faster than Western economies even when its slow.
That is the world economy landed me in debt all live, but it is not clear why the collapse and other troubles threaten China and only China, if the US has a much more prominent problem under the name “the money store”. Western economies — the USA, Japan and a key part of Europe together produce 52% of world GDP, but grow by 0.5 — 2%.
There is one indicator that economists operate with pleasure. It is called the generator of global growth. There are countries that operate only on themselves, but there are those, on which depends the prosperity of many others. Now, after the 2008 crisis, year after year, China generated about half of global economic growth. How? Pouring in their money economies, developing infrastructure, and promoting international trade in both import and export.
And now China is tired of saving the world. Now it is a country that produces about 15% of global GDP and generates 25% of global GDP growth. That is not half and half.
The West takes money a lot more than China, but results from these loans for much less of the world and the growth they generate is weak. And how can such Economics be saved?
By the way, the question about the infusion of new money into the Chinese economy very noticeably appeared at the session of the Parliament. And it was answered. The head of the government Li Keqiang said quite clearly that unrestrained injections will no longer be the Central and especially the local authorities themselves to slowly reduce its debt burden.
As for the usual world-record numbers of growth of China, they are not forgiven. The previous five-year plan set the task to double GDP between 2010 and 2020, which required an average growth of 7.2% per year. But until last year was 7.8 percent annually. In order to double GDP by that date, 2020, the 6.5% of that in the new plan and appear. That is, it is possible to do without pumping the economy of excess money, to eliminate overheating and to improve the structure.
And the world to let him decide at least part of their problems.