China is now officially the US government's largest foreign creditor after overtaking Japan, in a development that signals Washington's increasing reliance on Beijing to save its economy. China became the largest foreign holder of US Treasuries, owning 585 billion dollars worth as of September, according to US Treasury Department figures.
But, analysts warned Wednesday, neither country should be celebrating the development, which underlines serious imbalances in the global economy.
"China's GDP per capita ranks around 100th in the world but it is actually subsidising the world's richest country," said Zhang Ming, an economist with the Chinese Academy of Social Sciences, a government think-tank in Beijing. Zhang argued that becoming the largest foreign holder of US Treasuries is only an illustration of how serious the imbalances are in China's overly export-driven economy, rather than an indicator of its strength. |