Even though they are something for The People’s Republic of
China to be proud of but is the growing Mainland Chinese middle class a threat
to the global economy?
By: Ringo Bones
The growing Mainland Chinese middle class might be the envy
of the rest of the world’s tenured economists as their taskmasters henpeck them
on why their respective countries mimic the economic growth of Mainland China.
But is the growing Mainland Chinese middle class eventually destabilize the
global economy?
Economist tenured by the BBC may have this all recently
figured out on why a growing Mainland Chinese middle class could eventually trigger an economic contraction of their countries very own economy if not of the rest
of the world. The growing Mainland Chinese middle class seems to be spending
most of their disposable income on food and endangered species related products,
instead of American and EU made luxury goods. The increased demand on food by
the growing Mainland Chinese middle class had been inexorably hiking up food
prices around the world and sadly on the loosing side are the middle class of
the crude oil producing Middle Eastern states with weakening purchasing power.
Though there’s not yet a repeat of the 2008 Egyptian bread
riots, any more hikes in the price of basic foodstuffs could trigger political
instability in the wider crude oil producing regions of the Middle East.
Political instability in the Middle East more often than not results in higher
crude oil prices thus more expensive gasoline in the retail pumps in Europe and
America. And as gasoline becomes more expensive in America and the EU – the
world’s two main purchasers of Mainland Chinese manufactured goods – American’s
and Europeans will soon have less disposable income to spend on Mainland
Chinese manufactured goods and thus causing a contraction of the Mainland
Chinese economy. Based on this overall economic picture, could a growing
Mainland Chinese middle class and their increased demand on the global food
supply eventually cause a global economic contraction?
