The international rating agency, Fitch, believes that neither this year's heavy snow nor strong earthquake will have much of a negative impact on China's economy.
In an interview with People's Daily Online Tuesday, James McCormack, Fitch's managing director of Sovereign Ratings Asia Pacific, said that the impact of the snow in the beginning of the year would be "very temporary."
Compared with the snow, the strong quake that rocked Southwest China in May will affect the country's economy more; but still no significant impact is expected, commented Mr. McCormack.
He thinks some sectors could be affected more than others by the quake. The power supply, for one, may be reduced due to the damaged power facilities in the quake areas. Secondly, the labor supply will probably be affected. As many migrant workers are from those quake areas, they will leave their places of employment, and return to their hometowns to help their communities in this difficult time; and in reconstruction efforts in the near future. In combination with the wage increase which has already happened, consequently some pressure may arise, on the manufacturing sector in particular.
The cost of reconstruction after the quake, however, will not be a problem for the Chinese government. Mr. McCormack said that the central government's consistent fiscal surplus demonstrates that the government is financially "well-placed to provide resources" necessary for reconstruction, even on a large scale.
By People's Daily Online
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