China Imports

China is the world's third largest importer. In 2016, it imported $1.4 trillion. The United States imported $2.2 trillion. China imports raw commodities from Latin America and Africa, such as oil and other fuels, metal ores, plastics and organic chemicals. It's the world's largest importer of aluminum and copper. 

China’s commodity consumption has fueled a world-wide boom in mining and agriculture.

Why China's Growth Is Slowing

China's economic growth rate slowed to 6.6 percent in 2016, the lowest since 2009. Before that, China enjoyed 30 years of double-digit growth. Unfortunately, that was fed by government stimulus spending, business investment  in capital goods, low-interest rates and state protection of strategic industries like banking. The government's emphasis on job creation and exports left little for social welfare programs. That forced the Chinese population to save for their retirement.

Chinese leaders must continue to create jobs for all these workers or face unrest. At the same time, they must provide more social services. They all remember Mao's Revolution too well.

5 Facts that explain russia’s economic decline

Corruption, cheap oil and unproductive workers all hold Russia back—though Russians don't seem to care

For the first time since 2009—low point of the global economic slowdown—Russia is in recession. Its economy will contract 3 percent this year, though Moscow’s $360 billion in cash reserves will cushion the immediate blow.

Still, as President Vladimir Putin continues to try to assert Russian power on the international stage, it has become clear that he is now ruling a “submerging market.”

Unless something changes, Russia is in for a slow and steady economic decline.

These five sets of stats explain why.

Lack of Diversification

It’s not simply the size of your economy, but its diversity and resilience that counts. For years, the Kremlin has supported and protected large state-owned companies at the expense of small and medium-sized enterprises. But those smaller firms are the foundation of any strong and well-diversified economy.

Between 2008 and 2012, Russia’s private sector lost 300,000 jobs while the state added 1.1 million workers to its payroll. Rather than diversifying, Moscow is doubling down on its state-centered approach to economic development.

At the Mercy of Oil Markets

The price of oil has now fallen below $45 a barrel—welcome to the new normal. OPEC continues to pump oil at historic rates, and Iran expects to bring over a million new barrels a day to world markets. These are deeply troubling developments for Moscow, which relies on oil and gas sales for nearly 50 percent of its government revenues.

In 1999, oil and gas accounted for less than half of Russia’s export proceeds; today they account for 68 percent. Moscow has grown so reliant on energy sales that for each dollar the price of oil drops, Russia loses about $2 billion in potential sales.

At the Mercy of Sanctions

Moscow’s over-reliance on crude oil has also left the country vulnerable to international sanctions. Given the age of many existing fields, Russia will increasingly depend on cutting-edge technology from Western firms to pump oil from difficult-to-reach shale and deep-water reserves.

Some argue that Russia can turn for help to China—but China doesn’t have the technology Russia needs to draw resources from the ground. The IMF believes sanctions could eventually cost Russia 9 percent of its GDP.

Russia’s Other Problems

Russians aren’t nearly as productive as they could be. For each hour worked, the average Russian worker contributes $25.90 to Russia’s GDP. The average Greek worker adds $36.20 per hour of work. And Greece is not a country you want to trail in productivity. The average for U.S. workers? $67.40.

In addition, endemic corruption costs the Russian economy between $300 and $500 billion each year.

It’s no surprise then that well-educated Russians are leaving their country. Between 2012 and 2013, more than 300,000 people left Russia in search of greener economic pastures.

No Incentive to Change

Russia’s biggest problem may be denial. Typically, a stumbling economy brings about change in political leadership. But Russians have gone the other way—as their economy has slowed, Putin has grown more popular. More surprising is that while 73 percent of Russians are unhappy with their economy, 7 in 10 approve of the way Putin is handling it.

It’s easier under those circumstances to blame bad economic circumstances on outsiders. Credit where credit’s due—Putin knows what his people want to hear. It’s just not clear if he knows how to fix his flailing economy.