There is a possibility that China may become the third largest voting power at the International Monetary Fond (IMF) after the European Union and the United States. China, which currently holds a quota of 3.7 percent, may overtake Japan (6.1 percent) and establish itself right behind the U.S. with 17.1 percent and the EU member states with 32 percent. The IMF decided in a meeting in April to reform its governance structure in order to better reflect the economic importance of emerging economies. The reform process is scheduled to be completed by January 2011. With a higher quota China would also have to provide the IMF with more funding and take more responsibilities in the IMF’s decisions.
China’s industrial output growth last month slowed down from March and was less than half the rate of April 2008. With a comparatively weak growth of 7.3 percent industrial production was mainly backed by government’s economic stimulus measures. The new data raised uncertainty whether Chinese recovery is under way and sustainable yet. Generally, officially released statistics tend to overstate consumer demand and are inflated by stimulus measures. Analysts point to drops in electricity production and crude steel output in April, while industrial output and car production grew in the same period.
Chinese shipbuilders reported a drop in new orders of 95 percent for the first four months this year. Demand for new ships is on a record low due to overcapacity and low international trade volumes. The bleak financial situation for China’s shipyards is exacerbated by cash shortages and higher financing costs.
