http://news.xinhuanet.com/english/2009-01/04/content_10601248.htm
*China well placed to withstand global financial crisis*
Special Report: Global Financial Crisis
by Xie Peng, Qiao Jihong
*BEIJING*, Jan. 4 (Xinhua) -- China is well placed among world emerging
economies to weather the global economic downturn that has begun to infect
many developing countries, Alex Patelis, head of international economics at
Merrill Lynch, told Xinhua in a recent written interview.
With a high level of reserves, room for policy easing, strong savings
rate and low leverage, China's economy is healthy enough to withstand the
forthcoming external risks as the world's emerging economies see a
significant plunge in equity and currency markets, the economist said.
Considering the advantages of China's economy, Patelis put it on the
priority list to receive an asset allocation or portfolio in the worldwide
market if they were available in 2009. The economist also included Japan and
Brazil on the list.
Patelis said the major causes of the international financial crisis
included overdraft consumption, interest policy and regulation deficiency of
policy makers, weakness of human nature, interest conflicts of rating
organizations and flaws in international accounting standards.
The economist mostly attributed the decline in oil prices, which have
fallen by 60 percent since mid-July, to a demand-supply correction.
"Demand in nearly all countries in the world has fallen sharply at the
same time, while supply next year is expected to expand," he said.
Patelis also predicted that the U.S. dollar will continue to strengthen
through the first half of next year and then weaken, particularly against
emerging market currencies, in the second half.
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