Economics: Happy New Year China!

(Drivebycuriosity) - Today the Chinese celebrate their lunar New Year and the start of the "Year of Rat". During the now ending "Year of the Pig" China´s economy continued her slow landing and economic growth slowed to 6.1%. But the numbers from the economy front show a slight acceleration (driveby). In December industrial productions grew 6.9% year-on-year in December, accelerating from 6.2% growth in November and 4.7% growth in October. This was the sharpest yearly growth in industrial output since March last year, amid government support to prop up demand. Retail sales advanced in December & November each 8% the best growth since June. The robust numbers suggest that China weathers the trade war - and other problems - much better then her opponents think.

I think that the "Year of the Rat" will be prosperous. 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.

Happy New Year China!