Blog posts tagged by tag: China
Is Asia’s economy stabilizing? Will Asia ever fulfill its promise of being the driving engine for global growth? Will China get back to the booming growth of a few years ago or has the last year been a sign of the beginning of the end? Will India usurp China as the darling of the Asia-Pacific economy? These are some of the questions on the tips of tongues of many, and we try to answer those questions and more in our progress report on the Asian economy so far in 2016.
In an unexpected yet not entirely surprising turn of events, Philippines President Rodrigo Duterte continued his anti-U.S. rhetoric in late October by declaring that the island country would be “breaking up with America.”
The U.S. and the Philippines have shared strong relations dating all the way back to the late 19th Century when the U.S. occupied the Philippines as a colony. The relationship between the two nations has even been described as a “special relationship.”
Announced on 17 November, the Philippine economy expanded 7.1% in the third quarter of 2016 despite Duterte's antics since taking over in June. The economy is going strong, for now. In this post we take a look at what is at stake for the Philippine economy if Duterte does indeed move to break off relations with their long-time ally and driver of economic growth, the U.S.
China’s economy has been a bit of an enigma since the summer of 2015 when the country’s previously booming economy started to show signs of vulnerability. A combination of structural changes, subdued global demand and domestic challenges such as overcapacity in certain sectors and high corporate debt led growth to fall to a 25-year low for the full year 2015. It didn’t get much better from there, as economic activity continued to decelerate at the outset of the year. The Q1 economic expansion of 6.7% represented the weakest since the height of the global financial crisis in Q1 2009. The economy unexpectedly started to look better in Q2, as support from Chinese authorities prompted economic activity to stabilize. This trend continued into Q3, as encouraging economic data for August has shown that in addition to government spending, a booming housing market have supported growth. However, many of the same issues that plagued China’s economy in 2015 persist and there are concerns among analysts that decreasing private investment and a potential housing bubble could be detrimental in the longer term.
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Over the last few days, the world’s most powerful leaders have met in Hangzhou, China for the G20 summit. Economics has been at the center of discussions as the world economy has looked rather shaky over the last year.
It has not been a great start to 2016 for emerging markets. Collapsing oil prices have undermined Russia’s fiscal sustainability, Brazil is struggling through a deep recession and political chaos, and the Chinese economy continues to slow, hurting growth prospects in other developing countries.
According to FocusEconomics’ Consensus Forecast, emerging economies as a whole are estimated to have grown 4.0% in 2015 and are projected to grow 4.0% combined this year. Although growth rates in general continue to be faster than those of developed economies, according to the IMF’s latest World Economic Outlook report, they remain below the average of the past decade.
What’s in store for emerging markets for the rest of 2016? Have a look at our latest Consensus Forecasts and find out what the experts say about the key emerging economies this year.
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China’s meteoric rise in the past has been a boon to developing and advanced economies alike. Its seemingly insatiable consumption of raw materials destined for its rapidly-expanding urban centers and capital investments in a number of sectors helped to inflate what is often referred to as the “commodities super cycle” that has characterized the past 15 years. In an effort to secure such commodities, China has expanded its presence in sub-Saharan Africa, sending substantial sums of capital, expertise and workers to develop extraction industries and infrastructure in several countries. However, China’s rapid growth is unwinding, and its objectives in Africa are likely to reflect this fact. This month, Chinese leader Xi Jinping visits Zimbabwe and South Africa to engage in talks with African leaders.
There has been an intense debate over the policies that the Chinese government should have implemented in order to have successfully overcome this summer’s economic soft patch and avoid a much-dreaded economic downturn. Regarding the real economy, while some suggested that the priority was to prop up weakening growth in the all-important manufacturing sector, others stressed that the key was to boost domestic consumption.
Since the early 2000’s, China has grown into one of the world’s two main growth engines, along with the United States. This situation intensified during the global financial crisis and has remained unaltered in recent years. Therefore, any slowdown or economic turmoil in China has dramatic consequences worldwide. The recent lackluster situation in China’s property sector and less robust infrastructure spending at regional levels due to financial constraints have reduced demand for commodities. This situation has exerted further downward pressure on prices and hit growth among commodity-export-driven nations. Developed countries are also feeling the pain of weaker growth in China mainly due to lower purchases of consumer goods, including luxury items. Nevertheless, it is worth highlighting that China is now in a soft patch, which means weaker growth, but not declining economic activity (at least not for now).
More than a year and a half has passed since the Chinese Communist Party's leaders last published a detailed blue print for overhauling the country’s economic model. Xi Jinping and Li Keqiang emphasized that China had to transition from an economic system, mostly based on investment, manufacturing and exports, to a model centered on consumption and services. The ultimate goal of the Xi-Li administration was to rebalance the economy toward a more sustainable long-term growth trajectory.
Dukascopy TV recently produced a piece covering economic developments in South Africa as labor strikes and power outages, which have plagued the country over the last year, have had a significant negative impact on its economy. Low oil prices thus far in 2015 that should have positively affected the economy under normal circumstances were offset by the aforementioned power supply shortages, which have hurt manufacturing production. Business confidence is also down, hitting a three month low in the month of March. On top of it all, the recent xenophobic violence that was captured on camera and shared across the globe has not helped matters. Economist Dirina Mançellari spoke with Dukascopy to provide analysis on the situation.
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