久久亚洲国产成人影院-久久亚洲国产的中文-久久亚洲国产高清-久久亚洲国产精品-亚洲图片偷拍自拍-亚洲图色视频

Global EditionASIA 中文雙語Fran?ais
Opinion
Home / Opinion / China and the World Roundtable

China's rebound will be positive for world economy, offset Fed risks

By Dan Steinbock | China Daily | Updated: 2023-03-06 07:24
Share
Share - WeChat
A view of Beijing's CBD area on Aug 19, 2022. [Photo/VCG]

When Chinese policymakers began preparing for the re-opening, many international observers warned it would unleash inflationary headwinds. This was their assumption: As the world's biggest factory and the second-largest economy re-opens for business after three years of COVID-19 pandemic restrictions, it will have to cope with a surge in demand. That, in turn, would trigger global inflationary pressures as in the United States and the European Union, which have been struggling with elevated inflation since their re-opening.

There's only one problem with the story. Numbers do not back it up.

The US' annual inflation rate, which had soared close to 10 percent in summer last year, slowed, but slightly, to 6.4 percent in January, although the interest rate has been hiked to almost 5 percent.

In the eurozone, the situation was worse as inflation remained 8.5 percent in February 2023 after peaking at 11.1 percent in November. Meanwhile, policymakers have raised interest rates to 15-year highs to bring euro area inflation under control. Markets expect a 0.5 percentage point increase this month up to 3.5 percent, with a chance of a similar hike to be delivered in May.

Even in Japan, where inflation was actually negative until the fall of 2021, it rapidly soared to 4.3 percent in January 2023, and continues to rise. As a result, Japanese central bank's new chief Kazuo Ueda is likely to raise the interest rate over time.

Despite the media hysteria in the West, China's annual inflation rate rose to only 2.1 percent in January. And as expected, prices of food jumped and those of non-food gained further on the back of the Lunar New Year and the lifting of the strict pandemic prevention and control measures.

But the inflation rate was only half relative to Japan, a third compared with the US and a fourth compared with the eurozone.

After US' self-defeating trade wars, a pandemic-induced economic slowdown, an unwarranted proxy war, US efforts at another Cold War, and a series of energy and food crises, the global economy has been further penalized by the US Federal Reserve's ill-advised monetary policies, particularly since the fall of 2021.

After years of easy money and rounds of quantitative easing, the Fed misread the market signals after mid-2021, when inflation started to rapidly climb up and Fed chairman Jerome Powell downplayed the threat of soaring prices by calling them "transitionary".

Over a year ago, I had warned that inflation in the US could pose a risk to the global economy in 2022. Indeed, due to the belated monetary response, the ensuing risks penalized the ailing global recovery. In February 2022, after the disastrous failure of international diplomacy to end the Russia-Ukraine conflict and the onset of the US-NATO-led proxy war against Russia in Ukraine, I predicted the world economy would have to cope with the risk of stagflationary recession, compounded by energy and food inflation and the consequent cost-of-living crises.

The Fed raised the interest rate to 4.5-4.75 percent in its February 2023 meeting, still pushing borrowing costs to the highest since 2007. Recently, Fed Chairman Jerome Powell warned of more rate hikes and seems to be aiming at 5.25 to 5.5 percent, thus flirting with a recession.

Since the Central Economic Work Conference in December, Chinese policymakers have been stimulating private sector growth by taking measures to accelerate domestic demand and deepen regional and international trade and investment. They have also implemented a variety of measures to expand consumption, though the momentum is on the supply side, particularly infrastructure.

Already on the eve of the Two Sessions, Chinese leaders pledged stronger growth, and recovery is taking hold as economic activity picks up pace due to China's re-opening. Thanks to the recovery potential and despite the dismal first quarter, China's GDP growth could soar to 5.5-6 percent in 2023, or more than 6 percent on a quarter-to-quarter basis.

Ironically, external risks have been in part reduced by the misguided US trade wars and protectionism, which have compelled Chinese policymakers to stress the importance of self-sufficiency. Internally, the emphasis on social policies is meant to help increase the purchasing power of the new middle-income groups, without the kind of economic polarization that four decades of neoliberal policies have caused in the West.

Since the recovery will be demand-led, the spillovers will center on consumption and services in China. In addition to domestic demand, the recovery will also have an impact on global growth through commodity demand and travel, while the recovery in outbound tourism will be key to regional, and neighboring, economies' recovery. The global effect is already discernible in commodity prices. As the recovery broadens, oil and metals will follow.

However, spillovers will be significant in those economies that are part of the Regional Comprehensive Economic Partnership, the vast new trade bloc, and those participating in the huge Belt and Road Initiative.

Unlike the US, the eurozone and Japan, which are struggling with secular stagnation and exporting runaway inflation, China's growth is accelerating while inflation remains in check. The reopening could lift global GDP by an impressive 1 percent in 2023. In brief, China's rebound will be positive for the world and offset the Fed risks.

The author is the founder of Difference Group and has served at the India, China and America Institute (USA), Shanghai Institutes for International Studies (China) and the EU Center (Singapore). The views don't necessarily reflect those of China Daily.

If you have a specific expertise, or would like to share your thought about our stories, then send us your writings at opinion@chinadaily.com.cn, and comment@chinadaily.com.cn.

 

Most Viewed in 24 Hours
Top
BACK TO THE TOP
English
Copyright 1995 - 2025. All rights reserved. The content (including but not limited to text, photo, multimedia information, etc) published in this site belongs to China Daily Information Co (CDIC). Without written authorization from CDIC, such content shall not be republished or used in any form. Note: Browsers with 1024*768 or higher resolution are suggested for this site.
License for publishing multimedia online 0108263

Registration Number: 130349
FOLLOW US
主站蜘蛛池模板: 小明日韩在线看看永久区域 | 手机福利片 | 性猛交毛片 | 在线视频自拍 | 欧美成人日韩 | 国自产精品手机在线视频香蕉 | 亚洲成人黄色网址 | 成人高清无遮挡免费视频软件 | 欧美精品一区二区三区免费观看 | 亚洲精品成人a在线观看 | 午夜a毛片 | 欧美成人午夜视频免看 | 深夜在线观看大尺度 | 日本一区二区三区四区五区 | 好湿好紧好痛a级是免费视频 | 911精品国产91久久久久 | 狠色狠狠色狠狠狠色综合久久 | 久久黄色精品视频 | 欧美亚洲日本 | 国产一区在线看 | 欧美日韩在线观看视频 | 中文字幕亚洲一区二区v@在线 | 久久88香港三级 | 免费成人在线网站 | 日本高清视频在线观看 | 国产日韩欧美综合在线 | 国产日产欧产精品精品推荐在线 | 午夜视频在线观看一区二区 | 欧美日韩一区二区三区视频播 | 午夜性生活视频 | 日本不卡在线一区二区三区视频 | 可以看的黄网 | 亚洲一区二区欧美 | 亚洲国产一成人久久精品 | 男性吸女下身的视频 | 欧美va免费大片 | 欧美精品色精品一区二区三区 | 婷婷色九月综合激情丁香 | 欧美一级久久久久久久大片 | 久久老司机波多野结衣 | 国产精品久久久久国产精品三级 |