(Drivebycuriosity) - Trump`s trade war against China is slowing the US & the global economy. But the news from the economic front show that China is still doing better than the rest of the world. This morning we learned that China`s retail sales grew 7.8% YoY in September - better than in August (plus 7.5%) and industrial production advanced 5.8% after plus 4.4% (charts below).
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The numbers prove that the huge country is continuing her secular catching-up process, trade war or not. China`s growth is inspired by extreme income & wealth differences to the US and other
Western nation values. Today China has about $9,800 income per capita, the US number is $62,600 (worldbank).
China doesn`t have much commodities but it owns
a huge amount of human capital: 1.4 billion people who are intelligent,
who work hard and save a lot money to achieve a better life. Wikipedia
counted in 2014 already "2,236 colleges and universities, with
over 20 million students enrolled in mainland China" (wikipedia). The fast expanding knowledge is driving science & innovation, raising productivity and fostering economic growth (washingtonpost).
Chinese corporations, think tanks & administrations can employ a
large number of highly dedicated & educated people - a strong driver
of economic growth (scottsumner).
China`s growth is fueled by a rapid transformation process. The country
is transforming from an industrial & export-focused
economy into a modern system like the US, where most of the GNP is
fueled
by consumer spending. In the US consumer spending is the engine of the
economy. China is on the way to became a modern economy. Many peasants are
moving to the huge
metropolitan centers which are spread all over the huge country to lift
their standard of living. This creates a fast rising affluent middle
class, giving consumer spending a boost as the strong retail sales
demonstrate.
The robust numbers from this morning suggest that China will weather this trade war better than her opponents think.
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