In the world at large, the striking feature of the past year has been the decent economic recovery in America, contrasted with another appallingly weak performance from the eurozone, and a slowdown in the emerging markets.

Over recent years, the Chinese economy has slowed markedly, but in fact only in line with what you would have expected, given China’s stage of development. In 2014, the economic growth rate fell only marginally. Widely-heard fears of a Chinese economic collapse are wholly misplaced. Indeed, I expect growth this year to be only modestly lower than last year.

And lest you should think that the Chinese slowdown means that the impact of China on the world economy is set to be smaller, let me point out that the increase in China’s gross domestic product over the past year was just as large as the biggest increases in earlier years, including those when the economy was growing by 14pc.

This is simply an arithmetic point, but it is an important one. A smaller growth rate applied to a larger number can produce a bigger rise in GDP than a higher growth rate applied to a smaller number. Incidentally, the increase in Chinese GDP since the euro was created roughly corresponds to the current level of GDP in Germany and Italy combined. So methinks that the Chinese influence on the world is still pretty large, to put it mildly.

Another striking feature of the past year was the continued strong growth of the UK economy, despite this sluggish world picture, and despite our largest market on the Continent experiencing almost no growth at all. Unlike the previous year, however, although consumption did grow nicely, this expansion was not entirely a consumer affair. Corporate investment picked up strongly.

Once again, that perennial source of imbalance and danger in our economy, overseas trade, performed badly – hardly surprising when you consider that about 45pc of our exports go to a part of the world that has become a growth–free zone.

David Fuller's view

Here is a PDF of The Telegraph article.

Chancellor George Osborne deserves a considerable amount of credit for the UK’s economic recovery, although the job is far from complete.  However, given the unrevised Commons boundaries, it will be a miracle if he is still Chancellor after May 7^th, 2015, the latest date at which the next General Election can be held.  The stakes could not be higher, or the outcome more uncertain.  The alternative to a Conservative Party-led government would be the election of a left-wing Labour government, possibly in coalition with the Scottish National Party.  That absurd combination would condemn the UK to EU-standard governance. 

Even if China’s GDP growth is somewhere between 4% and 7%, that is a significant achievement by a government which is developing a more sustainable economic policy.  For investors, China remains a competitively valued recovery candidate, with the Shanghai A-Shares selling at a p/e of 15.10 and yielding 2.09%, although Hong Kong’s HSI Index, p/e 10.06 yield 3.80%, is now considerably cheaper following the democracy demonstrations held largely by students.