BEIJING ? When President Hu Jintao travels this week to the glamorous French resort of Cannes for a summit of the world?s 20 leading industrialized and developed nations, it should be China?s moment to swagger on the global stage.
European leaders have agreed to a $1.4 trillion rescue fund to stop the debt crisis in Greece from bleeding into other shaky euro-zone economies ? and they are looking to China to foot part of the bill. And while the United States and Europe come to the summit grappling with problems of huge debt and anemic growth, China?s problems are the stuff of envy: what to do with a foreign reserve stockpile of $3.2 trillion, and how to slow down growth to keep the Chinese economy from overheating.
Yet far from swagger, China?s leaders appear to be approaching this seminal moment with caution and outright concern.
China?s leaders will contribute to Europe?s bailout fund, economists and other analysts here said. But they are doing so mainly because they have little choice, since a continued economic crisis in Europe is bad for China too.
?It?s not only about saving Europe, but the U.S. and the whole world, including China itself,? said Yi Xianrong, director at the financial research center of the Chinese Academy of Social Sciences. ?A stable global financial system is also in China?s own interest.?
Patrick Chovanec, who teaches at Tsinghua University?s school of economics and management, agreed. ?It may seem like an all-powerful creditor and weak, supplicant debtors,? Chovanec said. ?But the debtor countries and the surplus country are locked in a mutual embrace that is problematic for both of them.?
Chovanec compared the situation to that of a small town shopkeeper who has to continue letting his customers build up higher and higher tabs on credit, for fear that if he doesn?t, they will stop coming and he will be forced out of business.
China?s ability to assist Europe ? and to bankroll the U.S. debt through the purchase of Treasury securities ? comes from its huge surpluses. The European Union, China?s largest export market, has a trade deficit with China of about 168 billion euros.
China?s leaders are also moving cautiously because they are acutely aware that Chinese public opinion is firmly against helping bail Europe out of its debt crisis. Comments on the hugely popular Twitter-like microblogging sites called weibo offer a window into the popular sentiment.
For China?s netizens, Europeans enjoy a rich lifestyle with lavish early retirement packages and several weeks of paid vacation each year, while the majority of Chinese can barely earn enough to make a living. So why should China?s government be using its hefty reserves ? the people?s money ? to help Europe instead of improving living conditions at home?
?The root of the heavy European debt is excessive welfare,? wrote one weibo user under the name ?Turbulence and Change.? ?They have a large number of lazy people. Even if China doesn?t offer a hand, Europeans still won?t live worse than Chinese. Furthermore, no European will die of hunger.?
Source: http://feeds.washingtonpost.com/click.phdo?i=934b769df01f35c657627542af6ef7f0
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