Open AccessPropagation of the Effects of China’s Changing Economic Development Model to the Rest of the World
Author(s) -
Marina Soloviova
Publication year - 2021
Publication title -
economica: revistă ştiinţifico-didactică
Language(s) - English
Resource type - Journals
ISSN - 1810-9136
DOI - 10.53486/econ.2021.115.096
Subject(s) - china , rest (music) , internationalization , consumption (sociology) , foreign direct investment , economics , investment (military) , goods and services , international economics , emerging markets , chinese economy , current account , value (mathematics) , renminbi , business , monetary economics , international trade , exchange rate , market economy , macroeconomics , medicine , social science , machine learning , sociology , politics , political science , law , cardiology , computer science
This paper tackles the potential effects of the fundamental changes that China’s economy is undergoing on the rest of the world. Thus, a range of effects in the development of China’s imports of goods and services can have on other countries were identified, in terms of China’s switching from investment to consumption and from manufacturing to services and innovations, as well as in exports, in the light of China’s upward movement within the global value chain. The spread of effects via the financial channel is examined for direct investment and external loans, with an emphasis on changes in both the size of financial flows and the motivation of Chinese investors. The emerging trend of relative reduction in China’s foreign exchange reserves, as well as the potential effects of the yuan’s internationalization going forward in terms of diminishing global current account imbalances were evaluated.