Posts tagged…China
Trade ‘imbalances’ are misleading
Mon, Jul 12 2010Alexandro Jara, the Deputy Director-General of WTO
"[R]elying on conventional trade statistics gives a distorted picture of trade imbalances between countries. As we saw when looking at the Chinese content of the iPad, what counts is not the imbalances as measured by gross values of exports and imports, but how much valued added is embedded in these flows.
The WTO estimate, based on IDE-Jetro…
Read more…Resources tax mess
Thu, May 06 2010
Henry Ergas explains what's wrong with the Brownian 'Resources Super Profits Tax' (apart from the appalling, ideological sniping at foreign investors).
"Unfortunately, we have a long history in this country of interventions that, were they capable of perfect implementation, might increase welfare. Typically, when reality hits, they have the opposite effect. The scientific tariff, which helped…
The cost of Renminbi adjustment
Mon, Apr 12 2010Yang Yao, Editor of the China Economic Quarterly, points out that Obama's health budget calculations may depend on Chinese savings
"Stopping the sale of Treasury bonds to China would benefit the US. First, it would prevent Chinese savings depressing demand for American goods. Second, it would discourage the US government from deficit spending and prevent skyrocketing government debts. Third, it…
Rotten ideas about the renminbi
Thu, Mar 18 2010The prospect of a U.S.-China clash over currency controls next month when the U.S. Treasury Secretary is supposed to pronounce on China's 'currency manipulation' has prompted hyperbolic fears (Martin Wolf, in the FT says he "wonders whether the open global economy is going to survive..."!) and at least two feeble plans.
One is from the IMF, which wants a new mandate—although it admits that's not…
Tea leaves
Fri, Feb 26 2010A hiccup? Or a sign that imported deflation—via low-priced Chinese imports—will now start to slow?
"‘Labour availability is tight right now in Guangdong compared to other regions,’ said Paul Hussey, chief executive of Strix. The Isle of Man company, which dominates the global market for thermostatic controls on electric kettles, maintains most of its manufacturing operations in the provincial…
Chinese savings rate & the gender balance
Sat, Feb 06 2010Fascinating. A strong, explanatory correlation appears between very high household savings rates and the male-gender imbalance.
"…[E]conomists and policymakers have looked with concern to the large Chinese current account surplus and large US current account deficit, or global imbalances, much of their discussion has focused on changing exchange rate policy. None of the discussion about global…
Are the BRICS ready to lead?
Wed, Jan 20 2010
Reflecting on the greater influence of the BRICS, recently, in global forums, the always-interesting Alan Beattie asks:
"Is this a pivot point such as the second world war, where the confident, innovative US muscled aside the weakened, debt-laden economies of Europe and remade the global financial architecture? " Extract from FT.com
His guess? "No, not yet". He points out the BRICS are…
Cheering for ‘democracy’
Tue, Jan 05 2010Rachman—who's normally pretty astute—assesses the emblematic events in Copenhagen as a blow to the U.S. program of 'spreading democracy'.
"As emerging global powers and developing nations, Brazil, India, South Africa and Turkey may often feel they have more in common with a rising China than with the democratic US." Extract from Gideon Rachman in the Financial Times
Although I share his sense…
How the deal was done
Mon, Dec 28 2009
Official Chinese account of the negotiation of the accord at Copenhagen, emphasising, of course, their own role:
The Copenhagen conference has put China on a higher and broader world stage. China has reason to be proud and China will work even harder! Verdant mountains cannot stop water flowing; eastward the water keeps on going.
The report provides a detailed account of Premier Wen's movements…
Good idea or insidious threat?
Tue, Dec 08 2009When an economy has trade leverage, the threat of discriminatory duties need not be simple protectionism.
"The US can help China make the necessary adjustments toward a reduction in imbalances by adopting a uniform tariff of 10 per cent on all Chinese imports, based on their values when they enter the US. Six months after the establishment of this tariff, the rate would increase by one percentage…
Market and PPP measures of GDP
Tue, Jul 14 2009
In comments on the previous post, Ian Castles AO, the former Australian Statistician, notes that the World Bank and IMF create confusion in their reports by mixed use of market-exchange-rate (MER) and purchasing-power-parity (PPP) bases for estimating output and growth. Simply, using market exchange rates to compare the value of output among countries over-estimates the size of developed…
Another small step
Fri, Jul 03 2009But it's impossible to ignore the significance of this continuing internationalization of the remminbi.
"Although it has no short-term implications for the full convertibility of the renminbi, the announcement provides ballast to the volley of political signals Beijing has been sending in recent months over its dissatisfaction with the US dollar." Extract from Financial Times