Tuesday, May 19, 2009

China is losing foreign markets, which could lead to the collapse of its economy

Chinese industry continues to lose foreign markets. In the long term this could lead to the collapse of export-oriented economy of China. Reorient the majority of companies operating on foreign markets, can not be. This is the conclusion of experts Center for Economic Research Institute of Globalization and Social Movements (IGSO). Consumption in the United States and the EU continues to decline. Losses of Chinese industry from the crisis may be one of the largest in the world, stated in a press release IGSO.
The Government of China for the first 1.5 years of crisis to support the United States sought to preserve the principal market for their goods. In late 2008, Chinese investments in the bonds of the Ministry of Finance United States exceeded 680 billion U.S. "China has become the largest foreign creditor of the United States. However, this did not lead either to an end the crisis or to improve the situation with the sale of Chinese goods in the North American market," - notes Director IGSO Boris Kagarlitsky. According to him, his policies of the PRC has demonstrated only a dependence on the United States and vulnerability. China remains a country of the capitalist periphery, despite its own corporate and political considerations.
The total cost of China to maintain U.S. financial system crisis exceeds the investment in their economies. "The Chinese Government is considering measures to develop national infrastructure, maintenance of domestic demand and the industry as temporary. China is not seeking to reorient the economy to the domestic market and shows no interest in the growth of incomes", - considers the head of the Center for Economic Research IGSO Basil Koltashov. According to him, the Chinese authorities have kept the former course, and still expect to change the situation in the United States. However, reducing the base demand in the world leads to the exacerbation of the struggle for markets. China is facing an even more severe course of crisis.
Deliveries of China for export, according to official figures, declined in April to 22.6% compared to the same period in 2008 In March the figure was 17.1%. The importation of goods into the country in April had fallen by 23%. Apart from the decrease in exports, sales have continued to be complicated by overseas Chinese goods. The rapidly falling direct private investment in the national economy of China. Domestically, there is also deterioration of the situation with sales of manufactured goods, which leads to a decrease in the already relatively low prices. Increasingly, it is suggested that the positive GDP of China rigged. Industry in China is losing foreign sales of domestic and not gaining, despite statements by authorities on the progress achieved.

RBC-Ukraine

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