the world. There is no doubt that China is regaining its strength and will be a major economic power in the 21st century.
What will China bring to the globalization of economy? Even for a country of 1.2 billion population and 960 square kilometers， there is no unlimited supply of cheap labor or unlimited tolerance of environment pollution. However， the demand of the 1.2 billion population market in a fast－growing economy could be the powerful engine of the global economy in human history. Some of Chinese key officials and scholars has turned to pro－deficit attitude on this debate and more and more people realize that China has no responsibility to supply the world with cheap goods while the living standard of Chinese people are below average level. While those booming Chinese companies have shown their appetites for raw materials on the global market， the extravagance of Chinese wealthy family in cities has given hopes to global manufacturers.
Most of the pressure to grow imports comes from China’s trade partners， especially US and Japan. A strong wind calling for the revaluation of RMB has been blowing since the beginning of 2003， and some even criticize China as an exporter of deflation. At the same time， huge amounts of hot money flow into China despite capital controls that strictly limit money flows into this country. Chinese officials have openly refused to revaluate RMB under pressure and some even say that its a conspiracy to sacrifice China’s economy without bringing benefits to the global economy. But those strong words against the revaluation of RMB were more or less for internal politics. The government then began to boost the imports to ease the pressure on the currency.
Domestically， there are more and more criticisms against the stimulating－export policies， especially the tax reimbursement policy. The tax reimbursement to exporters has aggravated the fiscal deficit of the central government. The government has paid 125 billion RM