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It is only 12 years old since the euro generated in 1999, but it has quickly become the secondlargest international

monetary next to dollars. The financial crisis originating from the United States has provided opportunities for euro with further improve status. With the way of the euro the is stronging, the asset of $euro euro is very hot. At euro 10 years old, the challenge between euro and dollar is still reverberating. However, the good momentum is ended by Greek debt crisis. In 2009, countries are still worrying about the subprime crisis hit bottom after the global economy. In 2010, countries are concerned about global deficit problem. From dubai to Greece, from Greece to the euro zone, from Britain to the United States, the huge deficits of developed economies is eroding the global economy.At present, China’s economic rebound is strong, the national debt and deficit is far below the internationally recognized risk tipping point, but there are also some local government debt and deficits in the development of blind phenomenon. And, China’s economy has already gradually been into the world of economic globalization, the world economy changes are appearent through the development of China’s economy and changes. Therefore, paying close attention to the trend of the European debt crisis, positively studying related countermeasures, has very important practical significance.Based on the analysis of the evolution process of the European debt crisis, according to propose, starting to analyze and solve the problem to arrange the essay’s structure, which can be divided into five chapters: the first chapter is the introduction section, mainly introducing the background and significance of the topic, literature review, research methods and innovative points; The second chapter mainly analysis the European debt crisis; and the deep reason Chapter 3 is from the eu, global economy, China’s export discussing all the influence of European debts; The fourth chapter try to analyze developed European countries debt crisis and the Latin American debt crisis in developing countries, the deep understanding behind two crises structural problems and profound reasons; Chapter 5 combining debt crisis lessons, put forward some beneficial to China’s economic health and the enlightenment of stable. INTRODUCTION
Because the end of globe war II, europe has been a good ever growing connections among European Countries. Starting as a detailed economic and politics relationship among Portugal, Germany, Belgium, Italy and also the Netherlands, eventually increasingly more countries joined the actual emerging EU till it became the actual 27 countries organization we all know it to end up being today. It is just 12 years old because the euro generated within 1999, but it's quickly become the actual second-largest international monetary alongside dollars. The financial turmoil originating from america has provided possibilities for euro along with further improve standing. In the immediate aftermath from the financial meltdown within 2008, the global turmoil has made an essential shift. By after that not the personal banking sector, from in which the financial crisis initially emerged from, but sovereign states face the danger of default. Financial stability dangers have increased substantially in the last two years because of the burst of the actual so-called European sovereign-debt crisis this year. In such a way that for the very first time since October 08, the risks in order to global financial balance have increased1. So much to ensure that some economists don't believe the eurozone can survive as pressures appear to increase and spread almost every other day. For example, early in 2012 the actual famous economist Nouriel Roubini warned how the eurozone will collapse inside the year..

Crisis origin

European sovereign debt crisis can also be asserted to have descends from easily accessible credit score funds. From this. This brought more than reliance on credit funds to satisfy the domestic turmoil. The surges associated with crisis in European countries have propelled an establishment of numerous pacts to make sure strict budget discipline to be able to erase monetary dangers and encourage monetary stability in Western economy. many large . This created susceptability of European economic dependence bringing on subsequent effect within Europe when monetary partners are worst hit through the crisis. From this. there's been a registered economic crisis due to overutilization associated with public expenditures to supply financial stability as well as stimulus in each international and Western financial markets. European sovereign debt crisis can also be asserted to have descends from easily accessible credit score funds. Furthermore. China overtook Canada when it comes to imports in the actual U. (Bradsher. China is classified like a “nonmarket economy”. largely due to some cheap labor pressure. the price from the goods would end up being exorbitantly cheap. many goods which are manufactured in The far east are taxed seriously upon sale within the EU because of the fact that if these tariffs weren't imposed. In The far east. For instance. Despite taking pleasure in such economic as well as trade dominance. The borrowed funds have been in turn used in order to curb the governments’ finances and finances which have deteriorated through the years. which legally speaking is how much money it takes in order to manufacture and market the merchandise. China is nevertheless not considered through the World Trade Business (WTO) to become a “market economy. has become the biggest importer of Chinese goods on the planet.Europe have participated within borrowing of funds in the international communities. After years associated with Canada enjoying a powerful trade relationship with america. Those opposed in order to China reaching marketplace economy status are quick to indicate the ramifications of this type of scenario. It provides products for countries worldwide. Furthermore. In recent years. European Union has additionally participated in many agreements which resulted in commercial and monetary interdependence. Chinese manufactured goods could be sold in line with the price for all of them in China which may be extremely low because of the weak state associated with Chinese currency. the German born. possibly the other most substantial economy. China has bypassed Asia and emerged since the strongest economy on the planet. there's been a registered economic crisis due to overutilization associated with public expenditures to supply financial stability as well as stimulus in each international and Western financial markets. 2011) The cost would be underneath the “normal value” from the good. China has mentioned through Premier Wen Jiabao that the reclassification of China from the nonmarket to an industry economy will prompt action in the country when it comes to helping the Western nations. China's Role in the Debt Crisis Europe have participated within borrowing of funds in the international communities. Amidst the continuing debt crisis using European nations. Which means that the country offers many restrictions imposed onto it by tariffs as well as trade laws. This brought more than reliance on credit funds to satisfy the domestic turmoil. The borrowed funds have been in turn used in order to curb the governments’ finances and finances which have deteriorated through the years. S within 2008..

1. amounting in order to nearly 311 million dollar).companies work closely using the government. From this. subsidization and low interest on loans. European sovereign debt crisis can also be asserted to have descends from easily accessible credit score funds. The borrowed funds have been in turn used in order to curb the governments’ finances and finances which have deteriorated through the years. Within principle. investment As we now have argued before. From this. Notwithstanding. China’s interests in supporting the EU Europe have participated within borrowing of funds in the international communities. this particular rate was nineteen.. Mei (2011) claims how the European demand with regard to China’s exports won't decline so long as the EU’s large economies (Italia. Nevertheless. France and Britain) don't collapse. the Eurozone’s sovereign financial debt crisis may result in decreasing demand with regard to Chinese products. In our strategy. This brought more than reliance on credit funds to satisfy the domestic turmoil. The 28 countries absorb around 20 per cent associated with Chinese commodity export (based on the WTO (2012). Economic causes could be assorted in 3 major groups that are related to industry. The federal government provides such advantages as discounts upon land. trade relations between China and also the EU have turn out to be very intense. In our strategy. Near the economic issues you will find notable political causes too. 7 per penny in 2010. China has numerous causes of decreasing the possibility of deepening the Eurozone’s sovereign financial debt crisis further. For instance. investment positions in addition to currency policy and foreign currency reserves. there's been a registered economic crisis due to overutilization associated with public expenditures to supply financial stability as well as stimulus in each international and Western financial markets. European sovereign debt crisis can also be asserted to have descends from easily accessible credit score funds. there's been a registered economic crisis due to overutilization associated with public expenditures to supply financial stability as well as stimulus in each international and Western financial markets. Germany. that obviously damages the actual Asian export-based economic climate. Economic causes could be assorted in 3 major groups that are related to industry. The borrowed funds have been in turn used in order to curb the governments’ finances and finances which have deteriorated through the years. This brought more than reliance on credit funds to satisfy the domestic turmoil. 4. Near the economic issues you will find notable political causes too. China being an export-oriented country getting the EU as it's large exportpartner . there are a few researchers who don't agree with this particular statement. 3 In addition.1 Trade Europe have participated within borrowing of funds in the international communities. China’s number 1 merchandise export market may be the EU. he highlights the very fact that China comes with an enormous domestic market which has the capacity to counteract the contraction associated with its export marketplaces. China has numerous causes of decreasing the possibility of deepening the Eurozone’s sovereign financial debt crisis further.

yet (UNCTAD. China’s share from the world’s total GROSS DOMESTIC PRODUCT is approximately 9 percent (UNCTAD. Therefore it serves as an essential reason why China must support the Eurozone also it to keep the worthiness of the dinar. Although the amount of these investments tend to be much smaller compared to European FDI within China but they likewise have reached considerable quantity. and it owns the biggest amount of foreign reserves on the planet.1. but the supplies . it has not really reached the 2008 level this year. therefore the actual Asian country offers great interest in order to help the Europe recover. But alleviate this problem the truth that statistics show which 80 percent associated with China's foreign industry is settled within dollars.may are afflicted by the decreasing Western demand. He believes how the European investments may decline in China due to the recession. China might have large losses when the euro depreciated resulting less worth from the Chinese investments. 2012). Indeed. yet other investors risk turning towards China escaping in the contraction of their own domestic markets. complete FDI inflow within China decreased through 2008 to 2009 and even though it increased later on. China has opportunities in Europe as well. The far east has trusted within Europe’s economic prosperity and Chinese investments within the EU have already been increasing continually because the crisis broke away (Figure 5). In add-on. Which means that the euro’s devaluation against US buck affects Chinese investors less seriously 4. Qingfen (2011) emphasizes how the EU’s cut associated with investment in The far east by 378 zillion dollars in September 2011 is strictly attached to the debt turmoil. 2010). especially in modern times (Zhimin as well as Armstrong. 2011). Leastways. Figure 5: EU’s FDI flows from and to China. Hence the EU became the 2nd biggest destination with regard to Chinese outward FDI at the rear of Hong Kong (Zhimin as well as Armstrong.3 Currency policy and reserves Because of its fast financial growth. 2010).1. Mei (2011) information a “dual influence” from the Eurozone’s crisis in this instance. 2012). the depreciation from the euro may worsen the situation since it decreases the Chinese language exporters’ income.2 Investments The worthiness of the Western direct investments within China is considerable and recently the EU’s reveal in China’s complete FDI has elevated (Ali as well as Guo. This suggests how the EU still remains an essential FDI-donor for China. 2007-2010 (billions of euros) Source: Eurostat (2012) However. including its exports towards the Eurozone (Mei. 2005). However the deepening EU turmoil can generate the drop in Western investments in China within the following years (Determine 5). 4.

Internationalized renminbi might offset the seigniorage that China needs to pay to the united states. This gives a large chance of China to accomplish certain political objectives such as the acceptance of it's market economy standing or dropping the actual arms embargo through the EU. It could preserve the worthiness of China’s foreign currency reserves. 4. 23. 2. and if The far east diminishes its ALL OF US Treasury bonds’ quantity. (We may concern these issues more in depth in section four. According in order to Gao and Yu ('09). 2. g.consist mainly ALL OF US dollars. This is actually contrary to the actual Chinese interests as well as this is the reason why Mihalakas (2011. With this context. With this knowledge it might not be astonishing if China tried to consider further steps with this direction. which is likely to happen . this sort of agreement could internationalize the actual renminbi. China’s old need to create a steady international financial system where the dollar would end up being less dominant may be only strengthened because of the current economic turmoil (Casarini. 5. Mihalakas (2011) draws focus on the so-called “Chinese Dilemma” regarding diversifying China’s holdings associated with USD. )#) claims which “Europe’s leaders shouldn’t expect some thing than symbolic Chinese support for that euro. China’s potential advantages of internationalization of the actual renminbi are the following: 1. It holds true that the Chinese language enormous dollar reserves boost the country’s dependence about the USA and trigger global financial unbalances. The actual cross-border transactions might boost. China may use its financial help Europe as the bargaining power. The international competitiveness from the Chinese financial establishments would increase.eventually. there's also political projections associated with China’s potential monetary assistance to the actual Eurozone.1.4 Political impacts Aside from economic issues. With purchasing euro-denominated assets. )#) Morris (2011) draws focus on a strange historical similarity: in Oct 1911. But the Chinese language renminbi is pegged against the actual dollar at a good undervalued rate to be able to maintain the Hard anodized cookware economy’s global competition. The exchange rate risk for that Chinese companies might decrease. after China rose up inside a . 2011). In this instance the Asian country might transfer the exchange risk towards the EU. The high reserves and also the current crisis possess highlighted for China how the internationalizing the renminbi is particularly important. Furthermore. The far east can realize the diversification in its currency supplies thus reducing the danger of keeping wide range of dollars. China may also force the EUROPEAN UNION to refrain through criticizing its human being rights achievement. it would result in a significant strengthening from the renminbi against the actual dollar. 3. 4. ” Godement (2011) mentions the chance that China could give Europe in renminbi.

Ireland. Greece’s domestic scenario became unstable along with political sentiments running full of nation-wide debates as well as elections. This really is one reason for China to not be ”a loan provider of last resort” as well as Wen Jiabao offers added that created countries must result in their fiscal as well as monetary policies and they need to cut the deficits within their country by their very own instead of awaiting China to conserve them (Badkar. the efforts by Europe. At first. These views were supported through the confidence in the entire strength of the actual EU economy. and the help of international businesses (Qiu. especially within the southern rural places. not just in economic. and Italy whose growth have been lagging for years were confronted with similar crises. the amount of living standards in the united kingdom stands at a minimal point.. Through mid to past due 2011. 2011). 2011). in October 2011 European countries turned to The far east to borrow. Greek debt experienced reached an intolerable a lot of 165. 2012) and also the country was about the brink of monetary collapse. Although Beijing has got the potential to help in the EMU’s recovery in the debt crisis and it has compelling reasons to do this. . but the Chinese intervention could cause really important problems within the domestic society how the Chinese government can't ignore. but additionally in political feeling. but additionally that it had been comparatively less serious than the ones that preceded it (Zhang.7 % of GDP. LITERATURE REVIEW The European debt crisis first started to attract global attention last year when Greece announced that its debt was13. In comparison. European financiers lent money towards the country. 2011). It was contended in China how the euro crisis wasn't only one of several crises of its kind found in history. 3 % (Eurostat.. Chinese scholars agreed how the euro crisis is really a long and enduring struggle and recuperation would take five as well as eight years. “it is among the biggest turnarounds in history” also it illustrates well which China’s global part has significantly changed in the past decades. It is really a sensitive point with regard to Chinese people that although the Chinese economy grows within an amazing way. not really 6 percent. 2012). Based on Morris (2011). Spain. internal social as well as political tensions may emerge from assisting the Europeans who still reside in significantly higher prosperity than most from the Chinese (Pierson as well as Lee. Because of this particular.revolution. However the situation did not really develop positively through the end of 2011. many in China thought how the problem would be short-term which the EU could address the issue quickly and successfully. Other Europe Spain.

as the China is one of the country which has ability to do this. at the mean time. some of the countries in Europe issued the national debt. the economy of China would be damaged significantly. which is the first place in the world. in this case. The impact of China . as the European economy more than the United States. A new trend on the problem There is a new trend on European banks how to solve the European sovereign debt crisis that China is the essential role in this crisis. it is can be said that the high cost from the European Union is greatly support the development of Chinese industry. especially for Italian. First of all. 7 billion euros national debt have been issued in order to relieve the crisis. the European Union is Chinese largest trading partners. and the employment pressure has been easing as well. in other words. American economy is not stable after the global financial crisis. not only Chinese economy will appear stagnation. since the European sovereign debt crisis was outbreak in 2010. Italy stated that they want China to but a large number of Italian national debt and investment its strategic industry company so that the country out of the debt crisis. Secondly. on the contrary. the relationship between the economy of China and the economy of Europe are intimate. Consequently. therefore. it is the strategic partner relationship. It is reported by Bradsher (2012). a cooperation can be established between China and European countries so that objective both of their strategic. if Europe will be collapsed. the main problem for European bank to solve this crisis is lack of funds. however. so compared with other countries. According to Jiang (2011). Some people hold this attitude is due to several reasons. sales situation of the national debt is turn into another problem for Euro zone. but also the employment problems will get worse than past. 2. if the Chinese imports to Europe be stopped. while the Europe debt crisis becoming worse and worse.1. China owned more ability to for help European countries relieve the crisis. this could lead to a stable and harmonious society be destroyed. it will be a serious political problems. And there is no strategic interest’s conflict between China and Europe. a lot of manufacturing products which made in China has exported to Europe every year.

in 2009. Though these data.It is cannot deny that the economy of China is growing with a remarkable speed in recently years. the stress of trade commodities has been adjusted so that the global trade is balanced. compared with the United States. which is the second biggest import country in the world(Jarreau 2012). the GDP of China only account for 33 percent of America and the stability of economy in China is not good as the Unite States. In 2008. the Chinese government has organized lots of trade and investment promotion group to America. 9. in 2010. However. the number is still goes up.4 trillion dollars. however. 1.0 percent. which is developed countries. even during the time of economic recession. There are some data has been collected by Holscher (2010). Moreover. that is the reason for some European countries ask for help from China during the period of the European sovereign debt crisis since outbreak. In terms of import and export trade. it was increased of 9. China still has an important influence on global economic situation. The impact of the European sovereign debt crisis . and it is becoming one of wealth country in the world. the proportion of car and spare parts import was went up dramatically in order to balance the trade. 3. to be more accurately.2% increased in the first quarter. compared with last year. and most of the car and spare parts are from the Unites States and Europe. Therefore. due to the new policies and measures has been enacted in recent years.067 trillion yuan in 2008. Before the financial crisis in 2008. which owned the biggest GPD in the world. the total amount of import in China was reach at 1. Europe and other countries. 7. In 2010. the GDP in China has overtake Germany and followed the Japan which was the third place in the world since 2007. it can be said that China provides the support to balance the bilateral trade.1% growth in the third quarter and the fourth quarter growth of 10.7%. the GDP of China was 30. we can see that the economy in China is growing rapidly. 6. according to preliminary accounting.13 trillion dollars commodities from other countries was imported to China. so as to billions of dollars order has been signed. even their economic development is facing serious challenges and under a difficult situation.9% growth in the second quarter. China was focus on raw materials import.

the countries would not have an anxious attitude to solve this problem. so countries should unity to solve this problem. Inspiration from the debt crisis and chapter conclusion The Europe sovereign debt crisis is a double edged sword to modern society. It is presented by Novak (2011). especially for small countries in Euro zone. after that. but also the individuals. no matter where the country it is. The worst situation might be the Euro zone going to collapse. there is a possible that some of those countries have to debt default. the European sovereign debt crisis lead to the euro depreciation. otherwise. Lots of investors might change their mind about which country is best choice for invest. a new currency area will be establish by those countries which have a better financial situation like Germany. the crisis is last several years. 4. Not only the European sovereign debt crisis impact on the countries. other countries will force them to quit Euro zone. this is means that the international investor prefer to invest in dollars. France and the North-western Europe countries. furthermore. on the other hand. which is means that companies and investors have more chance to . all countries will have a knowledge about the foreign currency investment. such as Greece. and exports and economic growth could be affected by currency appreciation. Furthermore. the value of stronger countries’ currency will increase significantly. due to the European economic instability during the debt crisis. and it will impact other countries indirectly. many investors reducing the investment in Europe. Consequently. it is an opportunity for countries and individuals to get benefits.As we all know. some of bad situations will appear to influence the stability of global economy. it is obvious that the crisis is harmful for global economy. Until now. and it would become worse and worse. a large number of capital might lose in Europe. the debt crisis has considerable influence on the international investment environment. the European sovereign debt crisis bring a huge effect on global economy. Overbeek (2012) stated that as some countries in the Europe can not meet the conditions of Euro zone. at the same time. If this situation has happened in the future. especially for country’s banking industry and financial system. the situation in the Europe will become worse than past inevitably. Italy and Spanish and so on.

from http://www. (2011). Europe countries have to share the new technology with other countries. In previous research. and European is another area which owned high technology as well. this project will be secondary research based as the cost the time is limited. this problem has attracted large numbers of economy expert to research how to relieve the crisis. such as questionnaires to bankers. the country which has buy European national bonds would be effected by the crisis. X. However. which is the best way to solve this problem is still a question to research.htm . Admittedly.com. while whether it is the most effective approach to solve this problem have not explored yet. Beijing Review. more benefits would be achieved for the country. through the European sovereign debt crisis. 2013.expand their business to European market.aspx?Language=E&Country=CN Mei. According to Matziorins (2012). the quantitative approach will be used. Retrieved January 03. it is general knows that sell new and high technology to some of the countries in the world is forbidden in the United State. if the European debt crisis will last a long time. if a country buy the national bonds from Europe countries. China’s Country profile.cn/world/txt/201112/12/content_411334. 2013. Research methods Due to the present research is basing on the problem of the European sovereign debt crisis. most of researchers only consider that China can help European banks in the crisis. the global economy is not stable as past since the European debt crisis was outbreak.bjreview. after the crisis has been solved. REFERENCES WTO (2012). from http://stat. Retrieved January 03. moreover.org/CountryProfile/WSDBCountryPFView. Moreover. The European debt crisis will not badly hit China’s economy. or survey in different banks. Some of primary research will be done as well. this is high risk behavior. especially for the country which the economy strength is not powerful enough. if not.wto.

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