China Can Help
It has been said that when the U.S. economy sneezes, the rest of the world catches a cold. So is China the needed dose of vitamin C and a cup of hot tea and lemon?
Alan Greenspan said on Thursday night at an energy conference in Houston that the United States is "clearly on the edge" of a recession, Reuters reported.
But "the growth momentum in China's economy is sufficient to help balance out whatever is happening in the U.S.," David Cohen, an economist at Action Economics in Singapore, told Bloomberg News.
New data confirm that China's engine of growth is still running hot, indicating that it could prevent a global slump.
China's official news reported that the nation's trade surplus with the rest of the world ballooned 23 percent, to $19.5 billion, in January from a year ago, more than forecasts. It did, however, narrow from December's surplus of $22.7 billion.
Exports increased 27 percent in January to $109.7 billion, while imports rose 28 percent, to $90.2 billion.
The growth came even on higher export taxes and amid calls for Beijing to let its currency, the yuan, appreciated in value against the dollar.
"While we are experiencing a decrease in growth in advanced economies, it is even more necessary than before to have a high level of growth in China," Dominique Strauss-Kahn, the managing director of the International Monetary Fund, said in Beijing, according to the Associated Press.Visit Portfolio.com for the latest business news and opinion, executive profiles and careers. Portfolio.com© 2007 Condé Nast Inc. All rights reserved.