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How to treat the European debt crisis and how should China respond?
First of all, we analyze the most fundamental causes of the European debt crisis. First, the real industry is too weak, and the country lacks substantial wealth output. We can observe that the five crisis countries of European debt, except Italy, have almost no important manufacturing industry. Although Spain also has relatively large manufacturing industries, they are all controlled by foreign capital. This makes these countries have no basic basic trade to balance their payments.

Second, over-consumption, the economy of western countries is generally driven by consumption, but the problem is that over-consumption exceeds the average production level of a country's labor force, which doomed the country's development to rely on debt.

Third, the public sector is huge and social welfare expenditure is too high. Italy is the most typical of the five European countries. Although Italy has the second largest industry in Europe and the fifth largest industry in the world, it has too many government personnel, low efficiency and high welfare expenditure, which is one of the countries with the highest welfare expenditure in the EU. As a result, a considerable part of the labor force did not carry out substantive production and did not get a high level of wages.

Therefore, the measures taken by our country according to the above-mentioned fundamental reasons should include

First, learning from the development of western countries, we should never underestimate the role of industrial manufacturing in society, and should constantly upgrade and transform industries instead of gradually giving up. This is the most fundamental wealth foundation of a country's real economic output.

Second, control the staffing of the government's public sector. The public sector is too large, which can only beautify the unemployment rate and per capita income on the surface, but in essence these people are actually unproductive. Too much will curb the demand for social labor.

Third, stimulate domestic demand. Since the reform and opening up in China, the pillars of economic development have been foreign trade and large-scale construction investment, which is unsustainable. The European debt crisis slowed down world trade. To maintain growth, China must reduce external dependence, appropriately increase the purchasing power of domestic society, stimulate domestic demand and make the country more stable.