Macroscope | China’s cooling imports are sending a huge chill across the global economy
The mainland’s slump in consumption removes a major pillar of the global growth story
As policymakers in China strive to rebalance the Chinese economy away from an investment-led to a consumer-driven model, a lot of economies in Asia and beyond are going to feel the chill, as a succession of recent papers issued by the International Monetary Fund (IMF) illustrate.
The scale of China’s economic clout is succinctly described in a recent IMF Working Paper (WP) titled “Chinese Imports: What’s Behind the Slowdown?”
“During 2000-2014 China accounted for one third of global growth,” said the Working Paper, published last month, noting that over the same period “exports to China increased dramatically from 3 per cent to 9 per cent of world exports and from 9 per cent to 22 per cent of regional exports”.
“China accounts for over a quarter of exports and imports of emerging and developing economies and is one of the main trading partners (top 10) for over 100 economies that constitute about 80 per cent of world GDP,” it added.
But “real imports in China have decelerated significantly over the last two years to below
4 per cent (year-on-year) from double-digit growth in previous years,” the paper said.