China-USA: One conflict less
China-USA: One conflict less
China’s Current-Account Surplus May Shrink, Zhou Says
April 26, 2009
By Michael Forsythe and Francine Lacqu
April 27 (Bloomberg) -- People’s Bank of China Governor Zhou Xiaochuan said China’s current-account surplus “‘will no longer be a serious problem” as the country’s economic-stimulus plan stokes domestic demand.
Zhou, speaking to reporters in Washington yesterday, said “hopefully the current-account surplus is going to shrink” as China’s economic stimulus plan begins to show results.
“For the medium term, I think probably this will no longer be a serious problem,” said Zhou, who was in Washington for the International Monetary Fund meeting.
China’s current-account surplus rose 15 percent to $426 billion last year, the State Administration of Foreign Exchange reported last week. Economists, including Morgan Stanley Asia Chairman Stephen Roach, say China’s current-account surplus and the U.S. current-account deficit must shrink in order to put the global economy on a path to sustainable growth.
Unless the two countries break a cycle that requires China to continue lending so the U.S. can keep spending, “we’re headed to another major crisis, and it could be worse than this one,” Hong Kong-based Roach said in an interview last month.
The global economic slowdown is curbing demand for imports in the U.S. and causing Chinese exports to fall. The U.S. current-account deficit narrowed to $132.8 billion in the fourth quarter of 2008, reflecting a smaller gap in trade of goods.
U.S. Trade Deficit
The shortfall, the broadest measure of trade because it includes transfer payments and investment income, was the smallest since 2003 and followed a revised $181.3 billion gap in the previous three months, the Commerce Department said. In February, the U.S. trade deficit fell to $26 billion, the lowest level in nine years.
Chinese exports declined 17.1 percent in March to $90.29 billion from a year earlier. Imports dropped 25.1 percent, leaving a trade surplus of $18.56 billion, according to the Chinese customs bureau.
Separately, Chinese Vice Finance Minister Li Yong, who is also attending the IMF and World Bank meetings in Washington, said in a statement that the international monetary system should improve rules for “reserve currency issuance, maintain the relative stability of the exchange rates of major reserve currencies, and promote a diverse and sound international currency system.”
Li called for more cooperation among developing countries to counter the “diminishing demand from developed countries” which is “one of the major causes of the global recession.”
“The crisis originated in the developed world,” Li said in the statement.
http://tinyurl.com/ryohwr
China’s Current-Account Surplus May Shrink, Zhou Says
April 26, 2009
By Michael Forsythe and Francine Lacqu
April 27 (Bloomberg) -- People’s Bank of China Governor Zhou Xiaochuan said China’s current-account surplus “‘will no longer be a serious problem” as the country’s economic-stimulus plan stokes domestic demand.
Zhou, speaking to reporters in Washington yesterday, said “hopefully the current-account surplus is going to shrink” as China’s economic stimulus plan begins to show results.
“For the medium term, I think probably this will no longer be a serious problem,” said Zhou, who was in Washington for the International Monetary Fund meeting.
China’s current-account surplus rose 15 percent to $426 billion last year, the State Administration of Foreign Exchange reported last week. Economists, including Morgan Stanley Asia Chairman Stephen Roach, say China’s current-account surplus and the U.S. current-account deficit must shrink in order to put the global economy on a path to sustainable growth.
Unless the two countries break a cycle that requires China to continue lending so the U.S. can keep spending, “we’re headed to another major crisis, and it could be worse than this one,” Hong Kong-based Roach said in an interview last month.
The global economic slowdown is curbing demand for imports in the U.S. and causing Chinese exports to fall. The U.S. current-account deficit narrowed to $132.8 billion in the fourth quarter of 2008, reflecting a smaller gap in trade of goods.
U.S. Trade Deficit
The shortfall, the broadest measure of trade because it includes transfer payments and investment income, was the smallest since 2003 and followed a revised $181.3 billion gap in the previous three months, the Commerce Department said. In February, the U.S. trade deficit fell to $26 billion, the lowest level in nine years.
Chinese exports declined 17.1 percent in March to $90.29 billion from a year earlier. Imports dropped 25.1 percent, leaving a trade surplus of $18.56 billion, according to the Chinese customs bureau.
Separately, Chinese Vice Finance Minister Li Yong, who is also attending the IMF and World Bank meetings in Washington, said in a statement that the international monetary system should improve rules for “reserve currency issuance, maintain the relative stability of the exchange rates of major reserve currencies, and promote a diverse and sound international currency system.”
Li called for more cooperation among developing countries to counter the “diminishing demand from developed countries” which is “one of the major causes of the global recession.”
“The crisis originated in the developed world,” Li said in the statement.
http://tinyurl.com/ryohwr
bin66 - 11. Mai, 00:41
