China set for dismal economic outlook

Bank exchange rates are you being ripped off by your bank

Economic uncertainty lies ahead for China, as experts predict that there will be a ‘severe export outlook’ for 2012.

The world’s second largest economy used to rely heavily on exports to fuel its growth. However, Zhiwei Zhang, an economist with Hong Kong-based firm Nomura, claims that China will see a rare trade deficit of $28.8 billion in the first half of 2012.

If the predictions become a reality, this will add further to the country’s already extensive deficit of $1 billion, which occurred over the past year.

China has been deeply affected by the weak demand from Europe and the United States. Yet, there are signs that China’s economy is resilient and becoming more tolerant of its narrowing trade surplus.

In the first three quarters of this year, the lack of exports pulled down China’s GDP by 0.1%. This represents an 18.2% year on year decline in trade profit between January and November.

According to the Ministry of Commerce, China’s trade surplus totalled $180 billion in 2010 and it’s expected to fall to $150 billion this year.

As the economy worsens on a global scale, China is expected to face an increased number of job losses and domestically falling overseas orders next year.

In a bid to stabilise exports the Chinese President Hu Jinato said at a conference that he plans to increase imports. This is also good news for debt plagued economies such as the EU and the US.

Transfer Money to China

If you are looking to invest in China, think carefully about how you will be transferring money to China. Foreign currency exchange rates quoted by banks are almost always worse than the exchange rates available through specialist currency dealers.

So if you are sending money to China– which you will inevitably have to do if you are looking to make a property investment, be sure to compare the market before you buy your overseas currency.

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China set for dismal economic outlook

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