NOURIEL ROUBINI: One of the important point I make is that the overspending countries now have to retrench, spend less, consume less, import less. And therefore, the over saving country like China, Germany, Japan, has to do their share of the global economy by saving less and spending more. Otherwise, in a world that is flush with a glass of capacity that will cover a global accurate demand is going to be weaker than otherwise.
For China, that means two things. It means they should let the RMB appreciate at a much faster rate. What they've announced a few weeks ago is totally symbolic. They've done very little. The rate of crawl up over there is going to be too little to make any difference. And secondly, they should accelerate the kind of structural reform that reduce the savings rate and increased the consumption rate.
Again, those things are going to take years to implement, but they're not even doing the basic background to achieve that type of a consumer society. So unfortunately, my answer is China is not doing its share of the global rebalancing.
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