On Monday, China's Vice-Premier told an audience at the third International Tax Dialogue Global Conference that the country's economic recovery has strengthened and now the financial state is better than expected.
It was reported last week on
Digital Journal that the People’s Republic of China will be the world’s second largest economy and will overtake Japan. Therefore, investors believe there is a huge opportunity waiting in the Asian country. Jim Rogers, co-founder of the Quantum Fund, dubbed China as the 21st century version of 20th century America, 19th century Britain and so on.
The nation’s Vice-Premier Li Keqiang, speaking at third International Tax Dialogue (ITD) Global Conference on Monday, which opened in Beijing, now says China’s economic recovery is strengthening and that the country’s financial picture is now much better than it was expected to be, according to
CCTV. However, he has forewarned protectionism and believes the global economic recovery is still rather weak.
“The momentum of China's economic recovery has been consolidated and economic development is better than expected at the beginning of the year.” China’s economy grew just under 9 per cent in the last quarter but the government did expect it to be 8 per cent. The driving force of this surge, as
Digital Journal noted last week, has been industrial production, which rose to 13 per cent in September.
China’s government instigated a record 4 trillion Yuan stimulus that made significant domestic infrastructure investments. The Vice-Premier was optimistic on his country’s economy but showed the opposite in terms of proposals by other countries of trade protectionism.
“Trade protectionism is obviously on the rise. The phenomenon of using tariffs to raise the threshold for market access is growing. This will hinder the world economic recovery and harms the relationship between countries. This is something that hurts others and does not benefit them and we will never do that.”
Nevertheless, he still feels governments around the world are facing tough financial challenges but also opportunities in an economic structure. “We should maintain the continuity and stability of macro-economic policies while enhance the flexibility and sustainability of these policies.”
In an e-mail correspondence with
Digital Journal, Zaman Monirusz, CEO of
The Bullion Mart, a Toronto-based bullion dealer, believes the economy of China will continue to grow and that the Chinese Yuan is one of the currencies to be on the rise in the coming decades.
Monirusz stated five reasons why the Yuan Renminbi and China are going to be the dominant force, not just in Asia but in the global financial landscape. “China has the highest GDP growth rate in the world. They have one of the highest trade surplus in the world.”
He iterated Keqiang’s sentiment of China’s stimulus package by stating that they are focusing more on domestic growth rather than exports. He added that this practice leads to more sustainable growth.
Last week, Monirusz spoke to
Digital Journal about the Chinese Yuan and feels that it could eventually be backed by gold, which would make, as many investors like Peter Schiff, feel that the Chinese Yuan would be the most prestigious currency in the world.
“They are one of the largest buyers of precious and base metals in the world presently. Where most of the central banks are getting rid of their gold reserve, the Chinese are adding to them. If ever there is a currency crisis then these gold reserves will definitely help them and their currency.”
Monirusz concluded that China doesn’t have as much debt compared to a country like the United States where they are facing a $13 trillion national debt and $1.5 trillion deficit. “They [China] do not have as much debt as compared to the western world, both at the government level and individual level.”
