Unit 2 Macro: Exporting to the Booming Chinese Economy

Before you read this blog please have a look at another blog written by our good friend Mark Johnston from New Zealand. Students of China and the US economy will find it fascinating!

There are good grounds for no longer calling China an emerging economy - it has arrived! The multiple significance of the rapidly-growing Chinese economy is plain for all to see but for Britain, only a small percentage of our exports of goods and services go there and this must change if Britain is to fully engage with and benefit from the rising might of the Chinese consumer. This article from the Daily Mirror provides a non-technical but clear explanation of the growing purchasing power of newly wealth Chinese, thousands of whom are flocking to western shopping malls to buy premium brands. Chinese foreign exchange reserves are also being used to buy up real assets - last week we heard that a Chinese sovereign wealth fund is set to buy nearly 9% of Thames Water.

As things stand Britain’s export businesses are not making the in-roads into fast-growing Asian, African and Latin American countries that is needed to kick-start the recovery. Too many of our exports continue to flow to debt-constrained economies where growth is weak and likely to remain so for some time to come. Read The Economist (Jan 2012) Exports are growing, but too slowly to rescue the economy

BoP-consistent: China: Exports: SA : quarterly from Timetric

Britain’s monthly balance of trade with China is shown in the chart below.

UK Balance of Trade with China (£m, monthly) from Timetric

We do have some British exporting success stories in China - British Aerospace, Rolls-Royce, Burberry to name a few - but simple not enough of them at the moment.

Unit 2 Macro: Cyclical and Structural Economic Issues Facing the UK [23 May 2012]
Unit 2 Macro: Evaluation on Supply-Side Policies [21 May 2012]
Unit 2 Macro: The Current Account of the Balance of Payments [20 May 2012]
Unit 2 Macro: UK Trade in Services [20 May 2012]
Unit 2 Macro: Migration and the UK Economy [20 May 2012]
Unit 2 Macro: The Importance of Productivity [20 May 2012]
Unit 2 Macro: The Output Gap [20 May 2012]
Revision notes on unemployment [20 May 2012]
Unit 2 Macro: Revision Notes on Supply-side Policies [10 May 2012]
Unit 2 Macro: Model answer for revision data question [9 May 2012]
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Unit 2 Macro: Growth and Development Glossary [5 May 2012]
Unit 2 Macro: Trade and Balance of Payments Glossary [5 May 2012]
Unit 2 Macro: Aggregate Demand Glossary [5 May 2012]
Macro Revision - Key Statistics on the UK Economy [4 May 2012]
Macro Revision: Putting Things in Context [29 Apr 2012]
Unit 4 Macro: The Euro Zone Crisis (Revision) [22 Apr 2012]
Unit 3 Micro: The Third Industrial Revolution [20 Apr 2012]
Unit 2 Macro: Skills Shortages Hold Back Recovery [12 Apr 2012]
Unit 2 Macro: Globalisation and the Growth of Ports [10 Apr 2012]
Unit 2 Macro: The UK Balance of Payments in 2011 [4 Apr 2012]
Unit 4 Macro: Productivity Improvements in China [3 Apr 2012]
Unit 2 Macro: Revision on Index Numbers [31 Mar 2012]
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George Buckley at the Millfield Economics Society [28 Mar 2012]
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OCR A2 Economics Unit F585 The Global Economy June 2012 [27 Mar 2012]
Solar Panels and Tariffs [21 Mar 2012]
Evidence of the dangers of protectionism [9 Mar 2012]
Unit 2 Macro: Policies to Drive Economic Recovery [9 Mar 2012]
Unit 2 Macro: Focus on UK Manufacturing [6 Mar 2012]
Unit 4 Macro: Sovereign Wealth Funds [4 Mar 2012]
Unit 2 Macro: Might Oil Prices Bring another Recession? [4 Mar 2012]
Unit 1 Micro: Highest and Lowest Paid Jobs in the UK [26 Feb 2012]
Unit 3 Micro: Volkswagen targets growth markets [25 Feb 2012]
Unit 2 Macro: Rosling on China and the UK Converging [24 Feb 2012]
Unit 2 Macro: Targeted Tax Cuts to help the Economy [22 Feb 2012]
Unit 2 Macro: The Dash for Gas in Mozambique [17 Feb 2012]
Unit 2 Macro: Is the UK Economy Turning a Corner? [15 Feb 2012]
Economics Explained, by Evan [12 Feb 2012]
Unit 2 Macro: China’s Trade Engine is Spluttering [10 Feb 2012]
Competitiveness [8 Feb 2012]
Unit 2 Macro: Growth and Development - Some Indicators [30 Jan 2012]
Unit 4 Macro: Focus on India - Comparative Advantage [27 Jan 2012]
Unit 2 Macro: Focus on China - Trade and Growth [27 Jan 2012]
Unit 2 Macro: Focus on China - Inflation [26 Jan 2012]
Unit 2 Macro: Focus on China - Carbon Emissions and Growth [26 Jan 2012]
Unit 2 Macro: Focus on China - Per Capita Incomes [26 Jan 2012]
Unit 2 Macro: Focus on China - Changing Economic Structure [26 Jan 2012]
Unit 4 Macro: Focus on India - World’s Cheapest Computer [26 Jan 2012]
Unit 2 Macro: Can China Stay Competitive [25 Jan 2012]
Unit 4 Macro: Focus on India - Economic Growth [24 Jan 2012]
Unit 3 Micro: 3D Printing and a Manufacturing Revolution [23 Jan 2012]
Unit 2 Macro: Population Shift in China [23 Jan 2012]
Unit 4 Macro: Money, Debt and the New World Order [22 Jan 2012]
Unit 4 Macro: Russia Joins the WTO [22 Jan 2012]
Unit 2 Macro: Videos on Productivity [17 Jan 2012]
Unit 2 Macro: Look Upwards to Find the next Downturn [15 Jan 2012]
Unit 2 Macro: Frontier Markets - the New BRICS? [15 Jan 2012]
Beyond the Bike - The Importance of Remittances [15 Jan 2012]
Unit 4 Macro: Time to Re-Boot the British Economy [14 Jan 2012]
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Unit 4 Macro: Competitive Advantage in Trade (Some Videos) [12 Jan 2012]
Unit 4 Macro: UK Trade Patterns [11 Jan 2012]
Unit 4 Macro: Does Manufacturing Matter? [10 Jan 2012]
Unit 2 Macro: Factors Driving Business Investment [10 Jan 2012]
Unit 1 Micro: Low Cost Airlines Beat the Recession [1 Jan 2012]
2011 in Review - The US Economy [27 Dec 2011]
Unit 2 Macro: Brazil Overtakes UK in Economic Size [26 Dec 2011]
Unit 1 Micro: Inside a Biscuit Factory [1 Dec 2011]
Unit 3 Micro: Hope Bikes - A Commitment to Excellence [30 Nov 2011]
Unit 4 Macro: Does UK Manufacturing have a Future? [30 Nov 2011]
Jim O’Neill - The Growth Map: Economic Opportunity in the BRICs and Beyond [22 Nov 2011]
Beyond the Bike - The Value of Money [19 Nov 2011]
Unit 2 Macro: Should the EU introduce a Tobin Tax? [14 Nov 2011]
AS Macro: The State of British Business [13 Nov 2011]
Latest world trade data [6 Nov 2011]
Unit 4 Macro: China and India - Notes from Martin Wolf [6 Nov 2011]
Unit 4 Macro: Richard Florida on the Great Reset [5 Nov 2011]
Unit 4 Macro: Should TNCs make full disclosure on factory wages? [30 Oct 2011]
Can the “invisible hand” solve Africa’s poverty? [13 Oct 2011]
Unit 2 Macro: Can Exports Drive a Recovery? [13 Oct 2011]
Skidelsky in Madrid [12 Oct 2011]
The Return of Protectionism? [12 Oct 2011]
Unit 4 Macro: USA edges closer to naming China as a “Currency Manipulator” [4 Oct 2011]
Unit 4 Macro: When China Met Africa [1 Oct 2011]
Unit 4 Macro: IMF Flags up Risks of Double Dip [20 Sep 2011]
Unit 4 Macro: Bangladesh and Comparative Advantage in Textiles [19 Sep 2011]
Study Note - Value Added and Contributions to a Nation’s GDP [16 Sep 2011]
Study Note - Introduction to GDP [15 Sep 2011]
Study Note - The Circular Flow of Income [15 Sep 2011]
Unit 2 Macro: Economic Growth and Inequality [14 Sep 2011]
Unit 2 Macro: Value Added in Production and GDP [11 Sep 2011]
Toilet rolls, soap and climate change [1 Sep 2011]
Unit 4 Macro: Rising Weight of Emerging Economies [28 Aug 2011]
Unit 4 Macro: Baltic Dry Index and Global Weakening [19 Aug 2011]
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