China fact of the day

Casual conversation and commentary lead most Americans to think that this accumulation of reserves corresponds to a large trade surplus in China, achieved by holding the value of their currency down.  In fact, the Chinese trade surplus is not that large.  It is well under 5% of GDP, smaller in percentage terms than the U.S. trade deficit.

That is from A. Michael Spence, in today’s Wall Street Journal; here is more.