very big fucking numbers

Posted on September 22, 2010
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This remarkable story from Michael Pasco at the Sydney Morning Herald takes us through some of the more amazing numbers behind the revolution of China’s economy. Its a striking account of just how much has changed in the state of world power in the last decade.

Over the past 30 years, nearly 400 million Chinese have moved to the cities. There are some 170 Chinese cities now with more than one million residents compared with only 35 in all of Europe. The urbanisation process has a long way to run with another 300 to 400 million people expected to move from the country to the city over the next 20 years. A typical 90 square-metre apartment in China requires about six tonnes of steel. Every tonne of steel requires around 1.7 tonnes of iron ore and more than half a tonne of coking coal. You can work it out from there.

And that’s just high-rise apartments. China is building railways like no-one ever has and every 10km of metropolitan subway requires about 75,000 tonnes of steel. And so on.

To state what should be obvious to us: “These developments in China are being closely observed in Australia, including at the Reserve Bank. A decade or so ago, we spent a lot of time puzzling over why quarterly movements in Australian GDP were so highly correlated with quarterly movements in US GDP. We don’t puzzle over this anymore – not because we solved the puzzle, but because the correlation has fallen. At the same time, the correlation between quarterly movements in Australian and Chinese GDP has steadily increased. Clearly what happens in the Australian economy is now more dependent upon what happens in China than has been the case at any time in our past.”

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