NC State Economist Mike Walden – “How Important Are China’s Problems?”
Mary: I’m Mary Walden, with economist MW, welcoming you to the economic perspective. Today’s program asks, how important are China’s problems? Mike, China’s economy has slipped from high gear to low gear this year, creating much uncertainty and concern in the economic world. Is this slowdown in China enough to spark a recession in our country?
Mike: Summary Answer
- China’s economy has downshifted, growing at 20% annually in 2010 to 3% annually today, according to private estimates
- Impact in US depends on where you look
- Exports of US firms to China are small – at 0.6% of US GDP
- But China is a big investor – including in the US
- So impact to date has primarily been financial – in stock market
- Clearly China’s pain has been partially responsible for some the big down-days on Wall St.
- But right now, analysts don’t think enough to cause a US recession
- I’m MW
Mary: And I’m Mary Walden for the North Carolina Cooperative Extension Service