CHINA’S ECONOMIC REBALANCING: WHAT ARE THE IMPLICATIONS FOR ITS EXTERNAL SECTOR?
Abstract
This paper examines the core aspects of China’s economic rebalancing process (from industry to services and innovations, from investment to consumption, and from exports to domestic demand), presents the main economic policy measures adopted to that end by China’s government, paying special attention to the impact of this process on the external sector of the Chinese economy, relevant for the rest of the world. We use China’s balance of payments and international investment position statistics to identify several major trends in China’s external sector in the context of economic rebalancing, among which the gradual abandoning by China of its role as assembler of goods after processing and shifting from “double surplus” (in the current account and in the financial account) to “current account surplus and net capital outflow”, in connection with China’s entering into the next phase of economic development.
Keywords
References
2015 年中国国际收支报告. (China’s balance of payments in 2015 report). State Administration of Foreign Exchange of the PRC (SAFE). 31.03.2016. (http://www.safe.gov.cn/wps/wcm/connect/3116fe804c3aee4e982c99c30181affd/2015年中国国际收支报告.pdf?MOD=AJPERES&CACHEID=3116fe804c3aee4e982c99c30181affd, accessed February 16, 2017)
China’s balance of payments, time series. State Administration of Foreign Exchange of the PRC (SAFE). (http://www.safe.gov.cn/wps/portal/english/Data/Payments, accessed February 16, 2017)
China FTA Network. Ministry of Commerce of the PRC. (http://fta.mofcom.gov.cn/english/index.shtml, accessed February 16, 2017)
China intensifies measures to stimulate consumption. Xinhua news agency. 11.11.2015 (http://news.xinhuanet.com/english/2015-11/11/c_134806731.htm, accessed February 16, 2017)
China presses VAT reform for greater economic vitality. Xinhua news agency. 21.03.2016. (http://news.xinhuanet.com/english/2016-03/21/c_135209750.htm, accessed February 16, 2017)
China to revise individual income tax. Xinhua news agency. 07.03.2016. (http://en.people.cn/n3/2016/0307/c90785-9026236.html, accessed February 16, 2017)
Chistruga B., Soloviova M. (2014) Financing scientific research in China. „Competitiveness and innovation in the economy of knowledge”, international scientific conference, 25.09.2014. Chișinău, ASEM, 2014, Vol. II, p. 223-228
Hewitt D. (2015) China Reduces Tariffs On Imported Consumer Goods To Promote Domestic Demand. International Business Times. 29.04.2015 (http://www.ibtimes.com/china-reduces-tariffs-imported-consumer-goods-promote-domestic-demand-1901154)
Huang Y. (2016) Understanding China's Belt & Road Initiative: Motivation, framework and assessment. China Economic Review 40 (2016), pp. 314–321
Jin X., Li D., Wu Sh. (2016) How will China shape the world economy? China Economic Review 40 (2016) 272–280, p. 277
Li W. (2016) Eight Major Issues Relating to China’s Economic Development in 2016. Development Research Center of the State Council of the PRC. (http://en.drc.gov.cn/2016-04/06/content_24325077.htm)
Lin, J. Y., Zhang, F. (2015) Sustaining growth of the People's Republic of China. Asian Development Review, vol. 32, no. 1, pp. 31–48 (https://www.adb.org/sites/default/files/publication/158090/asian-development-review-vol32-no1-2015.pdf)
Perkins D. H. (2015) Understanding the Slowing Growth Rate of the People’s Republic of China. Asian Development Review, vol. 32, no. 1, pp. 31–48 (https://www.adb.org/sites/default/files/publication/158090/asian-development-review-vol32-no1-2015.pdf)
Report on the work of the Government delivered at the Third Session of the 12th National People' s Congress. China.org.cn. 05.03.2015. (http://www.china.org.cn/china/NPC_CPPCC_2015/2015-03/17/content_35131860.htm, accessed February 16, 2017)
Regional Economic Outlook: Asia and Pacific. International Monetary Fund. April 2016. (http://www.imf.org/external/pubs/ft/reo/2016/apd/eng/areo0516.htm, accessed February 16, 2017)
Silagadze A., Tvalchrelidze A., Zubiashvili T., Atanelishvili T. (2016) Aspects of China’s economic development. Ecoforum, vol. 5, issue 1 (8), 2016, pp. 47-64 (http://www.ecoforumjournal.ro/index.php/eco/article/view/321)
Soloviova M. (2016) Loans provided by the Chinese government: opportunities and risks for the Republic of Moldova. Economics and Sociology. 2016/1, pp. 63-70 (http://ince.md/uploads/files/1467191540_economie-si-sociologie-nr-1-2016.pdf)
World Development Indicators. World Bank. (http://databank.worldbank.org/data/reports.aspx?source=world-development-indicators, accessed February 16, 2017)
温家宝:建外汇投资公司不影响美元 (Wen Jiabao: The founding of the foreign exchange investment company will not negatively affect the US dollar). BBC 16.03.2007. (http://news.bbc.co.uk/chinese/simp/hi/newsid_6450000/newsid_6457000/6457007.stm, accessed February 16, 2017)
习近平首次系统阐述“新常态” (Xi Jinping comments for the first time on the “new normal”). 09.11.2014. Xinhua news agency. (http://news.xinhuanet.com/world/2014-11/09/c_1113175964.htm, accessed February 16, 2017)
This work is licensed under a Creative Commons Attribution 3.0 License.