Estimates of Chinese gross domestic product, released this morning, showed that the rate of growth has sunk to its lowest since the financal crisis. Double-digit expansion may be a thing of the past, but China’s economy is now four times larger than it was at the turn of the century. Measuring China’s GDP using purchasing power parity, the International Monetary Fund estimates that China’s economy will be bigger than the US’s by the end of the year.
by Gavin Jackson and Keith Fray
On Tuesday the International Monetary Fund released its latest World Economic Outlook. A striking new finding emerges: the seven largest emerging markets are now bigger, in gross domestic product terms, than the long established G7 group of industrialised nations, when measured at purchasing power parity (PPP). Read more
by Andrew Jack
From trade embargoes to arms blockades, sanctions have long been an extension of conflict by non-military means. Since the start of the twenty-first century, there has been growing use of “targeted” sanctions that draw on intelligence to pinpoint individuals for travel bans or asset freezes. The United Nations, the European Union and the US have announced a wide series of measures, while other organisations including the African Union and individual countries have also issued them with varying degrees of success.
There is fierce debate about the effectiveness of sanctions, with at least two organisations seeking to assess their mixed impact. Our interactive graphic draws on the global analysis by the Peterson Institute for International Economics and the Targeted Sanctions Consortium, based in Switzerland. Read more
Chinese exports increased by 4.3 per cent in December compared to the same month last year, while imports rose by 8.3 per cent. That gave China a total of $4.16tn in combined exports and imports in 2013, a figure that the US will find difficult to match. This leaves no doubt that China, the world’s second-biggest economy, is now the world’s biggest trading nation on an annual basis.
Chinese and US trade values were similar in 2012, slightly larger for China according to their respective national data but slightly bigger for the US according to the World Trade Organisation and the International and Monetary Fund. Read more
Gentrification and commercial developments are breaking up Chinatowns in US and British cities, squeezing Chinese communities out of the vibrant neighbourhoods that grew up around earlier generations of migrants.
The changing demographics of New York City further highlight this pattern, with Asian communities having sprung up in Flushing and Queens, where they were traditionally focused in Lower Manhattan.
The animated maps above show decadal changes in the spread of localised Chinese and Asian communities in London, New York and San Francisco, created using data from the 2001 and 2011 editions of the UK census and the US censuses of 2000 and 2010. Read more
US economic growth has been revised upwards to 2.5 per cent. A pretty impressive rate, given that the UK is currently stagnating at just 0.7 per cent. On the other hand, it looks less impressive when compared to China’s booming 7.6 per cent (even though, for China, that’s a slowdown).
But wait a minute. Economists across the land are howling in pain at this jumble of misinterpretation. These rates aren’t comparable at all – because they’re all measuring different things. Read more
New dormitories for Chinese workers may appear to have little to do with the deaths of hundreds of textile workers in Bangladesh. But in today’s globally interconnected economy one may be the fabled butterfly to the other’s subsequent hurricane.
Chinese workers’ demands for better conditions and higher pay have been driving manufacturers to seek cheaper alternatives. That has brought many textile firms to Bangladesh, which is reputed to have the lowest textile industry wages in the world – and they have certainly been increasing much more slowly than those in China. Read more
Chinese exports grew less than expected in November, fueling fears of a further economic slowdown. But exports from western inland Chinese regions have never grown so fast as in 2012, beating export growth rates of the rich industrial coastal regions.
Chinese export growth declined to 2.9 per cent in November from 11.6 per cent in October. On a rolling 12-month sum exports grew at an annual rate of 7.9 per cent in November, a figure well below the more than 30 per cent growth of the late 2010 and early 2011 and marks a 28-month record low. But not all regions in China experienced the same slowdown.
Tension between China and Japan over the East China Sea is threatening to disrupt the strong trade relationship between the two countries.
In July Japan exported a higher value of goods to China than to Europe or to north America. It also imported a higher value of goods from China than from north America and Europe combined, and about the same amount as from the rest of Asia combined. Read more
Angela Merkel has been making much of Germany’s predominant role in the EU’s trade relationship with China – the oft-touted ‘special relationship’. The EU overtook Japan as China’s main source of imports back in 2011, and Germany is the biggest contributor to that. But Europe’s elevated status is not due to its own export growth; rather, it is due to Japan’s continuing performance slide.
Source: IMF/Haver Analytics
The latest data from the FT/Economist Business Barometer, the quarterly global business sentiment survey, was published last week and the business-friendliness section again made for interesting reading.
France’s “business friendliness” has plummeted since the last barometer survey, which was conducted before before the election of François Hollande as president. For the first time, more of the business executives surveyed by the EIU rated the country’s ”unfriendly” than “friendly” to business. Read more
Whilst the slowdown in China’s headline rate of growth has been extensively covered, what deserves more careful attention is its regional component.
This chart shows the economic growth rate in Q1 2012 of the various Chinese regions and their relative importance, sourced from China’s National Bureau of Statistics.
The growth of smaller regions was more volatile and was generally faster than for larger regional economies. Tianjin – a metropolis in northern China along the coast that boasts the highest GDP per capita in the country – had an impressive double digit growth, but its impact on the national number was fairly limited as it accounts for just above 2 percent of national production. Read more
With more than a year’s worth of of data from our exclusive business sentiment poll, the FT/Economist Global Business Barometer, now available, some interesting longitudinal patterns are becoming apparent for the first time.
Most notable among them is the steady erosion over the past year in executives’ perceptions of the “business friendliness” three of the world’s biggest developing economies, India, China and Brazil.
A new military spending forecast from analysts at IHS Jane’s Defence suggests that China’s defence spending will accelerate substantially in the next three years.
This interactive graphic examines defence spending and gross domestic product growth in the region – as well as showing contextual numbers for the US – the world’s biggest spender on defence. Read more