It’s become the Pacific’s 2nd largest donor
A new wave of splurge spending by Chinese in the Pacific and Papua New Guinea’s incredible leap into high economic drive with a mid-year opening of LNG project will open roads to a phenomenal growth in Asia/Pacific in the very near future, the region’s leading bank, Australia & New Zealand Banking group has forecast. A series of ripple effects of recent Chinese investments in the Pacific region through development aid handouts, trade and tourism reverberates right through the greater Oceania region, as well as Australia and New Zealand.
As China’s middle-class becomes richer, more and more tourists from the world’s second largest economy are unravelling out and searching for new tourist spots around the globe. While data from the Pacific islands are sketchy, Australia alone noted 750,000 arrivals from China – with an increasing number undertaking multi-destination trips in the past 12 months, up 25 per cent from the previous year. “A lot of this trade flows through to income and employment growth for businesses and increased tax revenues into government coffers,” declared economic analyst David Koch last month.
China’s affluence stems from the unprecedented rise in the country’s economy with a 7.5 per cent growth in that country’s Gross Domestic Product in the last five years. The outpouring of Chinese money in the region over the last five years spared off a recession despite the economies of the west enduring such a drastic downturn. “As we saw in the US, and then Europe, the financial capacity of businesses and governments to weather financial shocks are the key to stable employment and asset expansion and income growth,” declared Koch. “That’s exactly what China gives us – economic stability and continued growth.” In the past decade and particularly since 2009 – when recession engulfed major economies in the west – China has leapfrogged the US, Japan, EU and New Zealand into becoming the second larger donor to the Pacific Islands, behind Australia.
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