It is almost impossible to open a newspaper or open a world news station without finding stories that cover China’s economic growth in recent years. With a consistent annual growth rate of around 10 percent over the past decade and the title of the country which is the largest global exporter of goods, this country is a center of industrial strength that can be understood as the goal of many companies considering international expansion.
Witnessing China’s meteoric rise over the past few decades has been interesting, but the latest news about slowing growth raises the question: What will happen next for this growing economy? Is growth sustainable? What factors will emerge and what challenges will develop for those who want to do business in this opportunity-rich country?
Global interconnectedness and the impact of a connected world economy
An economy that has traditionally been seen as a foundation for the health of the world economy is being shaken. The Eurozone is teetering on the brink of a crisis, while the United States hopes to prevent a double recession. But China can no longer rely on the isolated remnants of this problem. Our integrated world economy does not allow one country to function as an island. Economic problems, both in the G8 countries or in a small country far apart, causing ripple effects throughout the world.
In the case of China, the impact of the world economy in chaos can be devastating. As the world’s largest exporter of goods, shrinking purchasing power in places like the US and Europe reduces consumer demand, which means less demand for low-cost products. China has an interest in positive economic growth throughout the world
Dealing with internal deficiencies
While China’s push in recent years has been to boost economic strength, rapid growth is beginning to catch …Read More