Ex­ports fall

De-cou­pling the­ory a myth

Finweek English Edition - - Companies & Markets -

BE­FORE IT BE­CAME clear the United States – and the rest of the world with it – would fall into re­ces­sion, “de-cou­pling” was one of the buzz­words in eco­nomic news. The word de­scribed what an­a­lysts thought would hap­pen: that big emerg­ing mar­kets – such as China – would de-cou­ple from the slow­down in the US.

The re­al­ity has been the very op­po­site. The sub-prime mort­gage de­ba­cle in the US and sub­se­quent credit freeze spread like a virus world­wide, in­fect­ing fast-grow­ing China as well. As the graph shows, China’s ex­ports have dropped. Ned­bank says in its lat­est

that slow­ing Chi­nese ex­port growth, slump­ing in­vest­ment spending, fall­ing prop­erty prices as well as fac­tory clo­sures and ris­ing stock­piles sug­gest China’s econ­omy is suc­cumb­ing to the slow­down in its key ex­port mar­kets. Bloomberg re­ports China’s econ­omy ex­panded at its slow­est pace in seven years in fourth quar­ter 2008. Gross

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.