China Exports Fade as Inflation Eludes Targets: Cutting Research

China’s fabled export competitiveness is on the wane and that has implications for the rest of the world economy, conclude Morgan Stanley economists Spyros Andreopoulos and Sung Woen Kang.

Their estimates show the profits of Chinese exporters from trading with the U.S. shrank 20 percent to 30 percent between 2004 and 2010 as domestic labor costs grew and their currency’s climb against the dollar lowered revenue once translated back into yuan.