China’s exports fell for the first time in seven years, more evidence that recessions in the U.S., Europe and Japan are driving the world’s fourth-largest economy into a slump.From Bloomberg. The long term situation may be far worse, though, if this story is accurate:
Exports declined 2.2 percent in November from a year earlier, the customs bureau said in a statement on its Web site today. Imports plunged 17.9 percent, pushing the trade surplus to a record $40.09 billion.
China’s leaders pledged “more forceful measures” to help small companies and create jobs in statements within hours of the trade report. The export collapse intensifies pressure on the government to add to last month’s steepest interest-rate cut in 11 years, extend a 4 trillion yuan ($581 billion) spending plan and let the yuan depreciate.
“The figures are horrifying,” said Lu Zhengwei, chief economist at Industrial Bank Co. in Shanghai. “Plunging imports show that on top of faltering global demand, domestic demand is also shrinking as the economy cools.”
Thanks to meatball in this Kitco thread for the link. What will the consequences be for the rest of the world when a country with over a billion people (not to mention a substantial nuclear arsenal) finds that it can't feed itself?
Two new reports – one from the Chinese government, the other based on criteria developed by the United Nations – should be enough to scare every government, economist and investor in the world about the future of the Chinese economy, currently the one global bright spot.
The underlying question raised by these reports is this: How can a nation’s economy grow when its soil is rapidly eroding and its water is rapidly becoming so polluted that it isn’t just unsafe to drink. It’s even unsafe for fishing, farming and factory use.
In short, how can a nation’s economy grow when its ecosystems appear on the verge of collapse?As reported late last month by Xinhua, the official Chinese news agency, “A three-year investigation reveals almost 40% of China’s territory, or 3,569,200 square kilometers of land, suffers from soil erosion.” Reuters news agency put it this way: “Over a third of China’s land is being scoured by serious erosion that is putting crops and water supply at risk, a nationwide three-year survey has found.” The survey reportedly was carried out by China’s bio-environment security research team.