Western nations have failed to capitalise on China'seconomic rise as they struggle with their own problems, leaving others tobenefit from the Asian giant's insatiable demand, HSBC said.
“The world economy is increasingly led by China. Thosenations raising their China exposure have outperformed. Western nations, facedwith internal discord, have failed to grab the opportunity,” the bank said.
“We are rapidly moving away from an ‘old world’ dominated byEurope, the US and Japan to a ‘new world’ led by China,” it said in a reportentitled “The Great Rotation”.
Among the beneficiaries of the global shift are countrieslocated close to China and far-flung exporters that supply the Asian giant'sdemand for commodities, the report noted.
South Korea's exports to China currently account for 12percent of its gross domestic product (GDP), up from 3.5 percent in 2000, HSBCsaid.
Malaysia and Singapore are also key industrial exporters toChina while commodities producers like Australia, Chile, Kazakhstan and SaudiArabia “have also shared in the spoils,” the bank added.
“And in demonstrating China’s ever-increasing connectionswith Africa, Angola is now China’s 14th most important source of imports aheadof India, France, Canada, Italy and Britain,” it said.
Western countries, in contrast, have failed to exploitChinese demand, it said.
US exports to China account for a mere 0.7 percent of USGDP, with Canada, France and Italy “more or less” at the same level, HSBC said.
Britain’s exports to China are even less significant at 0.4percent of British GDP, it said.
While Germany has expanded its trade ties with China, thiswas overshadowed by a bigger increase in its dependence on the rest of Europe,HSBC noted.
This is “one reason why, despite its competitive advantages,Germany found itself succumbing in the second half of 2012 to a crisis whichhad already engulfed other parts of the eurozone,” the bank said.
HSBC forecasts China's economy to grow 8.6 percent thisyear, up from an estimated 7.8 percent expansion in 2012.
The US and Japanese economies are expected to grow 1.7percent and 0.2 percent respectively next year while the eurozone is likely tocontract 0.2 percent, the bank said.
