To answer your question directly, in 2010 China imported 1.395 trillion dollars worth from rest of world.... Now you claim they would benefit with reduce import prices, what imports?: if the EU or US was to collapse economically all trade would cease up, ...
That "{China´s} trade would collapse if US does" is a very egotistical claim for you or the US to make. Other than its trade with US few of China´s trades settle in dollars now. Most of China´s trade now is via local currencies under at least two dozen currency swap agreements.
Lets look at the facts thru 2010 even though they don´t reflect the continuing decrease in importance in last 2+ years of China´s trade with the US:
(Part of post 1141 of this thread.) I´m just guessing but bet now the US buys at most 10% of China´s exports. In part because the low value added good goods now come from other Asian nations. – China´s worker had have double digit real wage increases for several years and China has lost competitively to Indonesia, Vietnam etc. for export of the junk they once sold the US. – Now they sell the US iPods, smart phones, digital camera, and computers etc, - high value added items.US / China trade in billions of dollars:
Year ending 2001..2002…2003…2004..2005...2006…2007…2008...2009…2010
US exports …19.2…22.1…..28.4….34.7….41.8…..55.2…..65.2….71.5….69.6….91.9
US imports…102.3..125.2..152.4..196.7..243.5..287.8..321.5…337.8..296.4..364.9…Up 356%
US balance…-83.0 -103.1 -124.0 -162.0 -201.6 -232.5 -256.3 -266.3 -226.8 -273.1
From table 1 at: http://www.uschina.org/statistics/tradetable.html
China’s trade with the world in billions of dollars:
Year ending...2001…2002…2003….2004…2005…2006…2007…...2008…....2009…..2010
Exports……...266.1…325.6..438.2…593.3..762.0…968.9..1,217.8..1,430.7..1,201.6..1,577.9…Up 593%
Imports……..243.6….295.2..412.8…561.2..660.0…791.5…956.0…1,132.6..1,005.9...1,394.8
Balance……..22.6…...30.4…..25.5…..32.1…102.0...177.5…261.8…...298.1…..195.7….183.1
From table 4 at: http://www.uschina.org/statistics/tradetable.html
Billy T comments: In 2001, US imports from China were 102.3 / 266.1 = 38.4% of China’s total exports; but in 2010 they were 364.9 / 1,577.9 = 23.1 % of China’s exports. I.e. Nine years ago, the US bought more than 1/3, nearly 40%, of China’s exports but now less than ¼.
However, China’s exports during this period have increased 593%. Its just that the US is absorbing relative less each year. Soon China will not need to export to the US as its internal sales are more important and rapidly growing as are exports to other Asian nations. – That is where China will trade in the future when the US and EU have collapsed in debt. China is wisely preparing for that day.
SUMMARY: China is making a real and very successful effort to be less dependent up the US and EU.
No I think dollar will a decreasing part of the IMF´s SDRs and the RMB an increasing and more important part, as China will back it bonds (for IMF and central banks only) with gold. I.e. the dollar´s dominance is coming to and end and the petrodollar is soon dead....I guess dollars will be useless, want to bet in gold?
(Part of post 1101 of this thread.)... "We are seeing explosive demand for gold," Zhou Ming, deputy head of the Industrial and Commercial Bank of China Ltd. (ICBC) precious metals department told Reuters. "As Chinese get wealthy, they look to diversify their investments and gold stands out as a good hedge against inflation." The WGC report also said the surging investment demand in China is a reflection of the ongoing internationalization of the Chinese yuan. ..." From: http://moneymorning.com/2011/02/22/...global-phenomenon-of-demand-for-yellow-metal/
China is actually encouraging its population to buy and hoard silver. See: http://www.sciforums.com/showpost.php?p=2643758&postcount=115 Also China can supply much of the demand for gold from it own mines which lead the world in production of gold. {40% more than #2 producer even by official figures which most believe grossly understate China´s true production.}
Billy T comment:
The IMF is discussing / planning to add the RMB to the mix of currencies that define the value of the SDR (Special Drawing Rights, each member of the IMF has and can borrow against, but is not much used.) SDRs have been suggested as an alternative to the dollar. I have suggested that when China is ready, it can back the RMB with gold to encourage central banks to hold Chinese RMB demoninated bonds. Just as they now hold dollar bonds and very little physical gold, which unlike the bonds pays no interest.
I.e. China would only back their bonds with gold for central banks, not individuals and not often need to deliver much gold / buy back their bonds with gold. China, as the world's largest producer of gold for last three years would have no problem in backing it bonds with gold for central banks. This would almost over night replace the dollar with RMB bonds as the international reserve currency, but as I have noted in many posts China is not yet ready to destroy the dollar. It needs to contiue the process of trading less with the US and EU first (trade more with other growing nations) and also to continue spending its dollars in reserves for real assets like oil, minerals, food stocks etc. China is switching to more of a domestic dominated GDP with more of its factories producing for that rapidly growing internal market. (All as Billy T predicted it would, years ago.) ...
I can´t find the post with link to data, but remember the main point well: Just the INCREASE in China´s trade with other main land Asian nations (all the way to & including Iran) in 2012 & 2013 will be greater than the TOTAL trade with the US in 2011! I.e. even if China did not have a dime´s worth of trade with the US in 2014 their trade would still be greater than it was in 2011! And that does not even count their increasing trade with non-mainland Asian nations like Australia, Brazil, Canada and more than a dozen in Africa! China does not need a healthy US and soon will benefit if US can´t import as the dollar has collapsed.
This was the claim of China´s just past president in his keynote address to a conference of these nations. The conference group is about 17 years old but is so greatly expanded recently that it has been renamed and this was the first year under the new conference name. Nearly 100 countries and autonomous tribal groups were represented at the congress.
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