CHINA MAY HAVE TO TAKE OUT LOANS
China's soaring trade deficit may have to be financed by borrowing at a time when access to foreign loans is restricted by Western sanctions stemming from the recent political crackdown, economists said Tuesday. They said the deficit is also increasing pressure for a currency devaluation.
The official press said the deficit for the first half of the year soared to $5.7 billion from $1.2 billion in the same period last year, with exports up just 6.5 percent and imports rising 26.7 percent.
The People's Daily quoted unidentified economists as saying the trade imbalance was widening every day and could exceed $10 billion for 1989.