Cool chart from my friend Andy Roth at Sinology
The National Bureau of Statistics has just released a detailed breakdown of China’s 2009 GDP growth.
Overall GDP rose 8.7%, with 92.3% of growth (8 ppts) from gross capital formation; 52.5% of growth (4.6 ppts) from final consumption; and a negative 44.8% (-3.9 ppts) contribution from net exports.
What does this mean? 1) China’s stimulus program last year–mainly spent on infrastructure and other investment projects–was much more effective than ours, which was mainly made up of handouts. 2) China does not need the U.S. to grow as much as many people think. Don’t expect their leaders to bend over when our politicians fly there to tell them how to run their economy. 3) Long-term, less interest in buying U.S. debt, pressure on both U.S. interest rates and the dollar.