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China Growth Rate Closer to Zero: Analyst
Wednesday, August 15, 2012 5:51
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It is no question that China—which has reported double-digit growth rates in the last three decades—is slowing down. Amidst the Eurozone Financial Crisis, and the global economy heavily vested in China, a Chinese economic cooling is not a good forecast for anyone. So the question looms, “how bad is it?” Author and economics analyst Gordon Chang says the real situation cannot be seen through the official growth figures. [Gordon Chang, Economics Analyst]: “The best indicator of Chinese economic activity is the production of electricity. And in April, electricity increased by 0.7%, and in May It was 2.7%. but in June it actually shrank by 0.8%. And because of electricity historically outpaces the growth of gross domestic product, it means that China couldn't have been growing much more than zero in the second quarter.” For July, the figures for industrial power consumption were muted, further highlighting a slowdown. Chang says other indicators also suggest that China has hit an inflection point, and faces very low future growth. [Gordon Chang, Economics Analyst]: “China went on this massive Easter egg hunt for commodities around the world, buying them up, and all of a sudden in the last three or four months it realized it couldn't use all of them. So it's being stored…it shows the Chinese economy doesn't need all this iron ore, doesn't need this copper, doesn't need the coal that it's buying. And that's really the best indicator of what's happened in China.” Chinese …
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2012-08-15 05:45:20
Source: http://www.youtube.com/watch?v=DonhO2nOKM8&feature=youtube_gdata
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