Myths about the Chinese economy
Posted by Stephen Cline on April 11th, 2010There are some myths about the Chinese economy which refuse to just go away. A lot people in the US seem to be harboring quite a few myths about the Chinese economy which are simply not true. For instance, some people think that the Chinese economy is already bigger than the US economy, as reveled in surveys around the US. Well, the Chinese economy may be growing fast, but it would take a long time to cross the $14 trillion economy of the US. The Chinese GDP is around $5 trillion at the moment, so it is around 1/3rd of the US economy and it has some time to go before it overtakes the largest economy of the globe.
It must also be remembered that the manufacturing base of the Chinese economy is that of low cost clothing and low value goods. The US produces goods that are 20 times the cost of the Chinese economy because it is into high end production. This means that the US earns much more than China per sale or export that leads to its much greater wealth in the long run. This is one of the main reasons why it will be quite some time before the Chinese economy even comes par with the US economy.
Tags: Chinese economy, myths