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Shifting growth towards domestic consumption would help lift growth within China and around the world, economists say.
Standard economic models predict that when interest rates are low and governments borrow less, foreign capital inflows dry up, dragging the exchange rate down and shifting growth from domestic demand to exports.
Less noticed, though, are the shifting growth rates in cloud-based IT gear versus traditional IT hardware, the technology that powers large corporations and other organizations.
Surprisingly, arabitol was the most abundant compound of the analyzed polyols in P. pastoris cells (five fold higher basal level then glycerol) and showed statistically significant increased levels (p ≤ 0.05) when shifting growth conditions towards high osmolarity.
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Nevertheless, in the long run, a stronger yuan would benefit China's economy and the world's by helping shift growth from investment and exports towards consumption.
But the government is continuing its campaign, begun after Asia's economic crisis, to shift growth from an earlier dependence on exports and foreign investment inflows to domestic spending.
At a conference this week, Chinese officials called the investment in western China a strategic move, designed to raise the living standards of the region's people and shift growth away from China's prosperous coastal areas.
Stronger currencies would also shift growth from exports to domestic demand and increase households' real spending power and help ward off protectionists in the West.Hubris is the big worry.
They need more flexible exchange rates, which would not only prevent a further excessive build-up in reserves, but also help to shift growth towards domestic demand and away from exports.
The investment slowdown is a part of a deliberate and carefully signalled policy by China's president, Xi Jinping, to shift growth away from the export-dominated model that brought more than a decade of double-digit growth rates, as China exploited cheap labour to become the undisputed workshop of the world.
As China Daily reports this week, "The 230 million-strong migrant workforce drives China's economy, but a lack of access to education, health and other services … forces massive saving, restraining Beijing's efforts to shift growth's focus to consumption from investment".
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