Hot Topics for the Future of PRC and Hong Kong, China
Kanamori, Toshiki | June 2005
Abstract
At the end of 2004, the macroeconomic balance in the People’s Republic of China (PRC) raises some interesting options. The external sector enjoys a huge surplus, with significant increases in the current and capital accounts (almost $46 billion and $53 bill. respectively, last year). Accordingly, foreign exchange reserves in 2003 amounted to a staggering $400 billion. Turning to the domestic balance, the increase of fixed investment has been significant, although consumption is sluggish. (The ratio of fixed investments to GDP increased from 35% in the 1980s, and 39% for the 90s to 47% last year; while the consumption ratio, once more than 50% in the 80s, it is now at just 43%.) This indicates overinvestment in the external sector is offset by over saving domestically. However, since investment is overheating in some places and the government is running a budget deficit, only savings by individuals can absorb all of the overinvestment from external and domestic sectors.
Citation
Kanamori, Toshiki. 2005. Hot Topics for the Future of PRC and Hong Kong, China. © Asian Development Bank. http://hdl.handle.net/11540/4056. License: CC BY 3.0 IGO.ISSN
1882-6717
Keywords
Development Economics
Regional Economic Development
Economic Impact
Asian Development Bank
Development
Economic Boom
Regional Economic Integration
Good Governance
Governance Approach
Economic planning
Economic structure
Growth policy
Trade relations
Trade policy
Trade policy
Economic development
Economies in transition
International economy
Border integration
Economic integration
Gross domestic product
Trade policy
Institutional Framework
Public Administration
Business Ethics
Regional economics
Economic forecasting
Economic development projects
Success in business
Business
Free trade
Business
Economics
Communication in economic development
Restraint of trade
International economic integration
Trade blocs
East-West trade
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