View Video Clip: http://news.bbc.co.uk/1/hi/world/7826768.stm
China's export-driven growth is slowing down with exports of
manufactured goods showing a marked decline over the last six months.
Despite this, the trade surplus continues to rise partly because of a large
fall in imports of primary products such as mineral fuels and iron ore.
Questions
1. Explain the possible impact on the global demand for and prices of
commodities from a slowdown in the Chinese economy.
2. Draw an AD-AS diagram to show the possible effects of a fall in
export volumes.
3. What impact will weaker GDP growth in China have on smaller
economies in the far-east Asian region?
4. What can the Chinese authorities do to boost domestic demand?
Supporting Charts
Is the Export Boom Over?
Monthly value of exports of selected products, $ billion
80
80
70
70
60
60
50
Mechanical and electrical products
40
40
30
30
20
20
10
billions
USD (billions)
50
10
High and new-tech products
0
0
02
03
04
High-and-new-tech products
05
06
07
08
Mechanical and electrical products
Source: Reuters EcoWin
20.0
20.0
17.5
17.5
15.0
15.0
12.5
12.5
10.0
10.0
7.5
7.5
5.0
5.0
2.5
2.5
0.0
billions
USD (billions)
Chinese Imports of Selected Primary Products
0.0
00
01
02
03
04
05
06
07
08
Inedible crude materials, except fuels
Mineral fuels, lubricants and related materials
Source: Reuters EcoWin