Shanghai region slows

Yangtze map right.jpg

The Yangtze River Delta region (which includes Shanghai, Jiangsu and Zhejiang) accounted for 22% of China’s GDP in 2007. It is focused on exports to the USA and EU, and is a major centre for chemicals production. But now, like the Pearl River Delta, its economy is slowing fast. According to the China Daily, an increasing number of companies have ceased production, and some have gone bankrupt.

Shanghai’s Mayor, Han Zheng, says “We are seeing negative growth in fiscal revenue, industrial output and exports, and there is increasing pressure on employment”. And there are reports that industrial sector profits in the region fell 44% between January – September 2008. The main problem is the global recession, which has reduced demand for China’s exports. In turn, of course, this will reduce China’s import needs, so slowing the rest of Asia’s economy.

About Paul Hodges

Paul Hodges is Chairman of International eChem, trusted commercial advisers to the global chemical industry. He also serves as a Global Expert for the World Economic Forum. The aim of this blog is to share ideas about the influences that may shape the chemical industry and the global economy over the next 12 – 18 months. It looks behind today’s headlines, to understand what may happen next in critical areas such as oil prices, China and Emerging Markets, currencies, autos, housing, economic growth and the environment. Please do join me and share your thoughts. Between us, we will hopefully develop useful insights into the key factors that will drive the industry's future performance.

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One Response to Shanghai region slows

  1. robbo 20 January, 2009 at 2:20 pm #

    I wonder, if China catches a cold does the rest of Asia get flu?

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