Wednesday, April 11, 2007

China's trade surplus probably doubled in March to $20b

This aricle is about China has advantages in exporting good to the US. It also mentioned the connection with the value of Chinese Currency. In the history, China was always a country of exporting, but during the period of Cultural Revolution, China completely closed the door to outside. That made China's economy undeveloped. Now the situation has changed. According to the article, "The gap swelled to $20 billion from $11.2 billion a year earlier", and "The US trade deficit with China jumped to a record $232.5 billion last year."
The export also has connection with Chinese Currency. The Yuan has been increasing its value, and it is not good for exporting. Because when the currency has a higher value, China will has less advantages in exporting and as the author noted that "China has limited yuan gains because a faster appreciation could put companies out of business and result in job losses in the world’s most populous country." Furthermore, "the industry would lose 8.8 billion yuan worth of exports this year if the Chinese currency gained 5%. "

1 comment:

brianhahn said...

This i think is good and bad for China. It is good because they are starting to come out of their reputation which was poor. This is bad because they are going to have so much value in thier currency countries may be unwilling to trade with them.