Chimerica. The relationship between China and America

Seminar paper from the year 2016 in the subject Business economics - Economic Policy, grade: 1,0, Edinburgh Napier University, language: English, abstract: The symbiotic relationship between China and America, also referred to as Chimerica, was built upon mutual advantages, such as a boost in exports for China in return for cheap credit provided to America. However, during the financial crisis it became apparent that the relationship had caused international economic imbalances, especially due to the incapacitation of the Dollar-Renminbi exchange rate mechanism. This essay will analyse the relationship of China and America, and elaborate on the potential for an end of Chimerica with a focus on the role of the financial crisis. Furthermore, it will discuss whether there is a need for revaluating the Renminbi (RMB) and provide an assessment of Chimerica's future prospects. The literature can be divided into liberal internationalist and nationalistic views. This essay follows a liberal view, but intends to give a balanced view.