Thus, India s high growth rates will have to remain dependent on strong domestic demand.

To offset the collapse in demand from industrial countries, they had stimulated domestic demand.

Meanwhile, strong currency demand has led China s M2 (broad money supply) to increase to 180 of GDP the highest level in the world.

It also means getting the balance between domestic and external demand right, and appreciating the sensitivity of medium and long term growth to the composition (and size) of domestic aggregate demand.

And Germany is slowly acquiescing to a prudent relative expansion in domestic demand.

Rebalancing demand, from investment and exports to domestic consumption

The reason, of course, is the strong increase in Chinese domestic demand.

The impact on growth will almost certainly be negative, even if domestic demand compensates fully for the decline in external demand.

Long term growth depends not on foreign demand, but on domestic supply.

China s GDP growth fell dramatically, owing to the collapse of external demand.

Owing to strong GDP growth, the debt to GDP ratio decreased from 100.2 per cent to 95.1 per cent.

Second, the Chinese production mix does not correspond to domestic demand, and investment in long products has outpaced demand growth.

A vibrant rural sector generates local demand for locally produced goods and services.

Finally, resource intensive developing countries may benefit from strong projected relative demand for commodities in the medium term.

China has the potential to maintain robust growth by relying on domestic demand and not only household consumption. The country suffers no lack of investment opportunities, with significant scope for industrial upgrading and plenty of potential for improvement in urban infrastructure, public housing, and environmental management.

Strong global demand, owing to emerging economies like China, has undoubtedly fueled some of the price increase.

Energy hungry America has long depended on the global market to meet domestic demand.

If excessive domestic demand was the problem, the solution should now be on its way.

But what we have seen since 2007 is an overshooting of the contraction in consumer demand and domestic investment.

In this sense, China has a rare opportunity to expand its growth potential by stimulating domestic demand.

This time, the loss is estimated at 3.4 of GDP, implying a larger increase in domestic demand if the right public policies are pursued.

The weaker peseta would stimulate demand for Spanish exports and reduce Spain s imports, which would boost domestic demand and reduce unemployment.

They demonstrate clearly that China is prepared to compensate for export weakness by stimulating domestic demand.

With domestic demand still weak, more export demand is just what the doctor ordered for an anemic economy.

Or an undervalued exchange rate can help to export the lack of domestic demand.

Expansion in domestic demand resulted in an increase of 22 per cent in imports.

China s current macroeconomic situation shares many similarities with the situation that it faced in 2007 and the best part of 2008, when, owing to strong investment and export demand, GDP growth surged significantly beyond its potential.

The dramatic improvement in demand in 2002 2004 did of course provide an incentive to add capacity, particularly in countries where continued strong demand growth was foreseen.

In fact, the existing shadow banking risks are manageable, given relatively robust GDP growth and strong macroeconomic fundamentals.

Indeed, strong Chinese demand has supported its trading partners export led growth for much of the past three decades.

Rebalancing demand, from investment and exports to domestic consumption

Together, these changes could lower total demand by nearly 2 of GDP.

They doubt that an alternative development strategy based on boosting domestic demand would succeed.

This did not work very well, because investment was constrained by deficient domestic aggregate demand relative to capacity.

That sustained demand provided an important stabilizer for the domestic economy, which the Baltic states did not have.

Both contribute to aggregate domestic demand, and the structural shifts on the supply side will be driven by the right mix of aggregate demand, with the low return component on the investment side removed.

Accumulating excessive debt usually entails moving some part of domestic aggregate demand forward in time, so the exit from that debt must include more savings and diminished demand.

It is necessary because persistently weak global growth is unlikely to provide the solid external demand for Chinese exports that it once did.

One narrative features a robust German economy with low unemployment, strong finances, and the right competitive position to exploit the most dynamic segments of global demand.

Critics such as Anthony Giddens highlight the place of regional producers of media (such as Brazil in Latin America) other critics such as James Curran suggest that State government subsidies have ensured strong local production.

As a result, for a given increment of domestic demand, China is far more predisposed toward foreign sourcing.

It intends to boost domestic demand and is committed to moving gradually toward greater exchange rate flexibility.

Indeed, the central challenge of economic development is not foreign demand, but domestic structural change.

Countries like China that have large surpluses will have to rely much more on domestic demand to fuel their economies.

To enhance domestic demand, Asia, including China, must reallocate resources and structurally transform the economy.