IMF Staff Country Reports

People’s Republic of China: Selected Issues

August 23, 2019

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People’s Republic of China: Selected Issues, (USA: International Monetary Fund, 2019) accessed November 22, 2024

Also available in: 中文

Summary

This Selected Issues paper focuses on the drivers, implications and outlook for China’s shrinking current account surplus. Although cyclical factors helped in 2018, the trend decline has been largely structural, driven by rebalancing, appreciation of the real effective exchange rate toward equilibrium, increase in outbound tourism, and moderation in goods surplus reflecting market saturation and China’s faster growth compared with trading partners. Policies should focus on continued rebalancing and opening to ensure excessive surpluses do not return; and to prepare the economy and the financial system to handle more volatile capital flows. From a global perspective, the decline in China’s surplus has lowered global imbalances, with different impact across countries, with the trade balances of Korea, Germany, Brazil improving vis-à-vis China, while that of Japan, India, and Indonesia deteriorating. Further declines in the current account surplus will reduce excess global imbalances—a positive development for global stability.

Subject: Balance of payments, Credit, Current account surpluses, Exports, Imports, International trade, Money, Trade balance

Keywords: Asset ratio, China, CR, Credit, Current account surpluses, Debt, Exports, Global, Household debt, Imports, ISCR, Managed trade deal, Surplus, Trade balance, Trade diversion, Trade diversion effect, U.S.-China tariff, Vis-à-vis China

Publication Details

  • Pages:

    60

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Country Report No. 2019/274

  • Stock No:

    1CHNEA2019004

  • ISBN:

    9781513511252

  • ISSN:

    1934-7685

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