China's World Economy
There are several factors contributing to this decline in their economy. To clarify, China’s economy is not in a recession; China’s economy is just growing about half as much as in previous years. However, because China is still the number one producer in the world, even this slight change in production output is enough to put the world economy in distraught. One reason is that China has decreased their trade is because they are transforming their economy from an export-oriented economy to a more sustainable consumption-oriented economy (Bremmer). This means that China previously depended on exports to boost their industrialization and GDP, but now they will rely on consumption. China’s shift from manufacturing to services has led to a reduced need for commodity, thus leading to a fairly large problem for some of China 's export partners. A second reason for China 's economic problem is the Chinese stock market crash earlier this year. The crash has caused many investors to pull out of the Chinese market which has led to a decrease in trading commodities. A third reason for China’s economic slack off is the current condition of the real estate business. Having previously accounted for about fifteen percent of China’s economic growth, this halt of real estate sales has caused the business to only account for about a fifth of what it was a few years ago …show more content…
These are the optimist of the economist community. They say that these low oil prices are a great investment opportunity and that this investment will boost the global economy. A few even think that China’s economic slowdown will pass over and recover by mid-2016. However, according to current IMF reports, the decline in China’s economy will continue for at least all of next year.
The world economy is declining because of the transforming Chinese economy and current oil prices. The global economy is constantly shifting due to individual country economies either growing or slowing. Everyone should be educated on the current state of not just their home country, but the state of the world economy