Stephen Schwartz, chief economist-Asia at BBVA Research in Hong Kong, said he doesn’t see declining exports as a systematic problem at this stage because there’s enough demand on the domestic front. In the future, he said, it’s going to be very important for China to move to higher-valued added manufacturing and to increase productivity in order to offset higher wages. Although it’s a very slow process, he added, China’s ability to catch up quickly and do things quickly is always underestimated.
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