USEUROPEAFRICAASIA 中文双语Français
Home / China

Current-account surplus will shrink

By Martin Feldstein | China Daily | Updated: 2011-01-31 07:53

China's current-account surplus - the combination of its trade surplus and its net income from foreign investments - is the largest in the world. With a trade surplus of $190 billion and the income from its nearly $3 trillion portfolio of foreign assets, China's external surplus stands at $316 billion, or 6.1 percent of annual GDP.

Because the current-account surplus is denominated in foreign currencies, China must use these funds to invest abroad, primarily by purchasing government bonds issued by the United States and European countries. As a result, interest rates in those countries are lower than they would otherwise be.

However, that may all be about to change, as the policies that China will adopt as part of its new five-year plan will shrink its trade and current-account surpluses.

Current-account surplus will shrink

Today's Top News

Editor's picks

Most Viewed

Copyright 1995 - . All rights reserved. The content (including but not limited to text, photo, multimedia information, etc) published in this site belongs to China Daily Information Co (CDIC). Without written authorization from CDIC, such content shall not be republished or used in any form. Note: Browsers with 1024*768 or higher resolution are suggested for this site.
License for publishing multimedia online 0108263

Registration Number: 130349
FOLLOW US