SalemNews.com, Salem, MA

The World

March 30, 2011

Developing economies' lead over rivals poses risks

(Continued)

WASHINGTON —

Unburdened by a financial crisis, China, India and other developing countries resumed fast growth as they continued their transition from agricultural to industrial economies. In fact, they're now generating their own growth instead of relying on exports to the rich world. The World Bank says, for example, that internal demand — including business investments, government programs and consumer spending — accounted for 80 percent of China's growth last year.

"The emergence of a huge middle class in both China and India is generating internal demand," says Lawrence, co-author of the forthcoming book "Rising Tide: Is Growth in Emerging Markets Good for the United States?"

An example, in the southern Chinese city of Dongguan, is Xu Maolin, 31. Working as a mid-level manager at a factory that makes medical equipment, auto parts and aircraft components, Xu earns more than $7,200 a year — a middle-class living in a country where the per-capita income is $3,650.

A decade ago, Xu left a poor farm village in central China for a job at the Dongguan factory at $100 a month. His wife and two children live in a house he bought in his home village. He also owns an apartment in Dongguan that he rents to other migrant workers.

Xu has an air-conditioned room to himself in the factory dormitory. After work, he logs onto his desktop computer to read news, download movies and chat with friends and family.

For all its benefits, fast growth is causing problems for China and other developing countries. Surging demand for commodities — oil, grain, steel — is pushing prices ever higher. Inflation is running near 5 percent in China, over 9 percent in India and near 11 percent in Argentina, AP's Global Economy Tracker found. Inflation in the United States was just 1.9 percent last year.

"I don't feel I'm any better off than, say, last year," says Li, a waiter in Beijing who would give only his surname. "My salary might have gone up a little bit this year. But the prices of everything just went up like crazy."

Text Only | Photo Reprints
The World

AP Video
Today in History for July 29th Deadly Ebola Virus Threatens West Africa Kerry: Humanitarian Cease-fire Efforts Continue Raw: Airstrike Shatters Fragile Calm in Gaza UN Security Council Calls for Gaza Cease-fire Today in History for July 28th Israel, Hamas Trade Fire Despite Truce in Gaza Italy's Nibali Set to Win First Tour De France Raw: Violent Clashes Between Libyan Militias Today in History for July 27th Thousands at Peace Rally in Tel Aviv Raw: Sirens After Explosions in Israel Video Shows Smiling American Bomber in Syria Raw: Planes With MH17 Victims Land in Eindhoven Kerry Lays Out Ceasefire Goals for Gaza Family of MH17 Victim Pay Respects at Crash Site US Evacuates Embassy in Libya Amid Clashes Raw: Tanks Patrol Gaza Streets During Ceasefire Raw: Residents Come Home to Rubble in Gaza 12-hour Cease-fire in Gaza Fighting Begins
NDN Video
'Hunger Games: Mockingjay Part 1' Sneak Peek GMA: Dog passes out from excitment to see owner Chapter Two: Designing for Naomi Watts Baseball Hall of Famers Inducted Florida Keys Webcam Captures Turtles Hatching Morgan Freeman Sucks Down Helium on 'Tonight Show' Robin Wright Can Dance! (WATCH) She's Back! See Paris Hilton's New Carl's Jr. Ad Big Weekend For Atlanta Braves In Cooperstown - @TheBuzzeronFox Chapter Two: Becoming a first-time director What's Got Jack Black Freaking Out at Comic-Con? Doctors Remove 232 Teeth From Teen's Mouth Bradley Cooper Explains His Voice in 'Guardians of the Galaxy' Deja vu: Another NYPD officer choke-holding a suspect 'Fifty Shades of Grey': Watch the Super Sexy First Trailer Now! Reports: Ravens RB Ray Rice Suspended For 1st 2 Games Of The Season Air Algerie plane with 119 on board missing over Mali Diamond Stone, Malik Newman, Josh Jackson and others showcase talent Free Arturo - The World's Saddest Polar Bear A Look Back at Batman On Film Through The Years