- SmithStreetSolutions Predicts Stimulus Packages Will Drive $572.9B in Imports
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NEW YORK--(Business Wire)--
SmithStreetSolutions, a leading consulting and advisory firm based in Shanghai
and New York, today announced the publication of its whitepaper: Initiative in
Crisis: The Effects of the US and China Economic Stimulus Packages on Global
Recovery. The study examines the US and China`s responses to the financial
crisis, including:
* A comparison of 10 different stimulus spending categories shows that the
largest portion of the US stimulus (27.1%) is going toward tax relief, while the
China stimulus is weighted toward infrastructure development (37.5%). The US is
spending 16.0% of the stimulus on education and training, whereas China is only
spending 1.3%; however, a significant portion of the China stimulus is targeted
at rural development and post quake reconstruction (34.3%).
* China and the US agree on the importance of Technology and Sustainable
Development with both countries allocating significant portions toward promoting
technology sectors, representing 14.6% and 16.3% of their respective packages.
* Both stimulus plans are predicted to have great impact on the global economic
recovery by supporting international trade - calculations estimate the US
stimulus will drive $274.9 billion in imports, and China`s stimulus will drive
$298.0 billion in imports.
* Funds have been allocated, but the majority of the stimulus dollars have not
yet been spent in either country, so the impact must be predicted by other signs
such as consumer confidence, which has increased to 69.4 in the US for October,
an improvement from the low of 55.3 in November 2008. In China the IMF maintains
a positive outlook, projecting China`s GDP will grow at 8.5% in 2009.
"For the United States and most of the world, the financial crisis has
overwhelmingly been a disaster, and has required emergency measures by
governments around the world to prevent economic collapse. For China, however,
the crisis has been more akin to an opportunity," said Steven Lee, head of
investment research and analytics at SmithStreetSolutions. "SmithStreet`s
research has shown a clear delineation between the stimulus approaches of the US
and China, with the US stimulus focused on emergency measures to shore up the
financial system and promote domestic consumption, versus China`s stimulus which
is driven by infrastructure development and long term growth of the economy."
The US stimulus package focuses on reigniting domestic consumption, while
China`s stimulus package takes a longer-term approach of Government-led
infrastructure development. The whitepaper`s side by side analysis of the two
stimulus plans is broken down into 10 categories including: Protecting the
Vulnerable, Education and Trading, Healthcare, Energy and Sustainable
Development, Infrastructure, Science and Technology Advancement, Other Social
Programs, Tax Relief and Other, Post Quake Reconstruction and Rural Development.
For a full copy of the whitepaper, please contact emily@blisspr.com
About SmithStreetSolutions
SmithStreetSolutions is a leading Research and Advisory firm based in Shanghai
and New York. We draw upon our understanding of the China market and our
experience conducting market and investment research to provide the knowledge
you need to make sound business decisions. Our consulting services are
integrated with our Production services, providing both you and our teams with
world class data analytics, document production, and translation solutions.
For more information please visit www.smithstreetsolutions.com
BlissPR
Emily Weinman, 212-840-8079
emily@blisspr.com
Copyright Business Wire 2009
