China to overtake US
HSBC: It is set to become world’s largest trading nation by 2016
HONG KONG: China will overtake the United States as the world’s largest trading nation by 2016, as intraAsian commerce and rising demand from emerging markets boost shipments, according to HSBC Holdings Plc.
Trade in China and the Asia-pacific would grow at an annualised pace almost twice as fast as the world average over the next five years, driven by shipments within the region and expanded ties with Latin America, the Middle East and North Africa, HSBC said in a global trade report issued yesterday.
Demand from traditional consumer markets in the West is expected to slow as the evolving European debt crisis threatens the global outlook. China, the world’s second-biggest economy, would stimulate growth with fiscal stimulus and an acceleration in infrastructure projects, raising its imports of commodities from Latin America and the Middle East, HSBC said.
“The world’s largest businesses are continuing to broaden their supply chains across Asia-pacific that will boost trade within the region,” Simon Constantinides, HSBC’S regional head of global trade, AsiaPacific, said in an interview in Hong Kong. “As China expands its global reach, especially into South America and Africa, its substantial energy demand and higher manufacturing output will drive strong imports and exports within these sectors.”
HSBC estimates the value of China’s trade will rise at an annualized rate of 6.6 % over the next five years, compared with 6.5% gains for Asia and 3.8% for the world, according to reports.
“The developed markets will slow,” Constantinides said. “Everybody is going to trade with China.”
China’s share of global imports and exports will increase to 12.3% in 2026 from 9.8% last year, the bank estimates.