Sunday, 15 February 2015

China ' s Economist Growth and Opening up to International Trade: Effects on SG

       I think that China's economic growth will cause Singapore's own economic growth to decline. When China's economy grow, more companies will start to build their factories and other work there. However, Singapore is a country whose economy depends largely on the investment of large foreign companies on Singapore. Hence, when companies start to invest more in China, there may find that their revenue may be higher in China than in Singapore since Singapore's salary for both labour and skilled jobs is higher than that of China. Therefore, more companies will move to China to expand their businesses, instead of Singapore. The decline in investment from companies will lead to a decline in Singapore's economic growth.

       On the other hand, I think that China's opening up to International Trade will help Singapore in becoming more prosperous. This is because, when China open up to International Trade,  it allows to import goods from and export goods to other countries in the world. Since China's products and manufactures are usually cheaper than other countries, Singapore get to buy the same thing but now at a cheaper price. This way, the rate of inflation happening may be lowered as businesses can make money even if they do not sell their goods or services at a high price. When the rate of inflation if slower, more people will be able to afford more things. Hence, the lives of Singapore residents will be easier.

No comments:

Post a Comment