Michael Pettis quotes Chen Deming (minister of commerce), who wants Chinese enterprised to push abroad (…) and promote Chinese exports, as export earnings could trickle down to compensation, ultimately stimulating domestic consumption, and Hu Shuli (胡舒立, founder and editor of the Cai Jing magazine), who argues that China must instead rebalance its economy, i. e. move away from its export reliance – although taking such measures would have been less painful before the crisis struck:
It’s clear that, regardless of the angle from which we examine the situation, our economy is being squeezed by internal and external crises. Excessive consumption in the United States is a root cause of the global financial crisis. Instead of complaining about this fact, or even quietly congratulating ourselves, China must consider what to do if the United States learns its lesson and, for example, gradually raises its household savings rate. If external demand for Chinese goods is declining, how can internal demand rise?
Let’s expect a mixture of both. Obviously, export opportunities are nothing bad (where they show up).
