China Slows Down
By Isaac Cohen*
Last year, the gradual downward trend projected by the Chinese government was evident in the rate of economic growth of 7.4 percent, the lowest in 24 years. The annual economic growth projection for 2015 is expected to be 7 percent.
Recent foreign trade figures, the main propeller of the spectacular, two digit rates of growth of the last decades, reveal a more pervasive downturn. For instance, in January, exports decreased 3.3 percent from a year ago, due to lesser demand in Japan, the European Union and Hong Kong, the main trans-shipment point for Chinese exports. To the United States and Southeast Asia exports were stronger, but not enough to avert the slowdown in January, from the vigorous increase of 9.7 percent in December.
The sharp fall in imports was due to weakness in domestic demand and the overall decline in commodity prices, including oil. In January 2015, imports fell 19.9 percent from a year ago, steeper than the decrease of 2.4 percent registered last December. For instance, steel production decreased because of a slowdown in housing construction and in automobile production. The volume of iron ore imports declined 9.3 percent in January from a year ago.
*International analyst and consultant. Commentator on economic and financial issues for CNN en Español TV and radio. Former Director, UNECLAC.