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I’ve been watching and listening to the events and chatter about Hu Jintao’s visit to the US.  There is certainly a striking difference between the way China and the US are acting now that Obama is President and Clinton is Secretary of State.  While there are still many issues to be resolved, there appears to be mutual respect between the leaders.  This makes me hopeful.

President and Mrs. Obama even hosted a rare State Dinner for Hu.  President Bush just had a working lunch.  This is a significant difference in the respect given to US-Chinese relations.  It’s about time America took its head out of the sand and fully acknowledged the second largest economy and fastest rising super power in the world.

The economics of  the two countries tell the story of why it is so important to have a good working relationship.  The US GDP is $14.6 trillion.  The Chinese GDP is $5.7 trillion and rising at double digit rates.  But if you compare PPP (Purchasing Power Parity) or PPC (Purchasing Power Correction), a comparison of consumer buying power in each country, China’s economy is already larger than the US.  And it will continue to grow.  In the next few years, China’s middle class will be 700 million people;  more than double the population of the entire US.  Not only will this be the largest consumer market in the world, it will become the greatest target market ever for US goods and services.

Of course we all understand that China is still working on things like human rights and democracy.  But there is no stopping the warp-speed economic development inside China. 

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One Comment

  1. It was interesting to read your thoughts in your blog titled “A Change in Attitude.” Moreover, your comments on the warp speed economic development in China is spot on. However, it may not address all of the other things happening in China.

    Despite the West’s attitude about China’s economic growth, challenges with the RMB and the enviromental impact of China’s growth plans, they are also moving along at warp speed with respect to environmental and sustainability issues.

    While the US congress debates energy, climate change and environmental policy, China is just doing it. I’m in China 6 times a year and it is amazing to see the trend. We all can read the statistics, but China just keeps doing it.


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