China seems to be in a volatile economic and political situation right before the US summit. The world is becoming an anticipating spectator of the oscillating economy of the country and waits for the outcome of this event.
Last year China was almost sure to surpass even the US as a rising economic power, but the present situation of world’s second largest economy is very feeble. The stock markets have shown a decline of almost 45% since last four months.
Although there have also been some slight yet positive recent ups in the stock market, the economic stability of China still remains in question with respect to the growing middle class of the country, on which it depends a great deal. This middle-income trap appears to be a test for the country to get a step closer to advancement from the developing nation it is today.
The happenings of China are directly affecting the international sphere as well. China has long been in the favor of having renminbi as a global currency, so as to stay put it in the economic competition with dollar and the euro. When the news of a drop in the rates of Chinese currency by 2% against dollar came out, more questions rose in response.
The result was uproar of investors in the stock markets with a huge down in points worldwide. The cyber crime accusation is very likely to come up in the US summit as well.
China’s major finances come from the international business like with US and the grounds for even cheaper exports set disapproval in motion straight away.
The world is seeing the serious troubles and the contrasting actions and approach of the government with a critical eye. The information coming from the country is not considered very reliable, especially when it states a growth rate of 7%..