Amid plummeting trade growth, Chinese productivity trends are macro bearish

In recent months, we have seen a precipitous drop in Chinese trade growth. This comes from both the export and the import side.

What's happening?

A large part of it is wages. As I indicated two years ago, China has already sucked a large portion of the labour out of its countryside villages. And that has buoyed wage growth. Research by Chinese economists on the Lewis Turning Point indicated that the resultant coastal city labour shortage could spell inflation and trade deficits for C...

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