That seems to be the attitude in 2011. Which worries us at EconomyWatch.com, because we do not believe that the underlying problems have been solved. If anything, they have been exacerbated.
But first, the numbers, taken as ever from our Economic Statistics Database.
World Economic Statistics at a Glance - 2011 Forecast
World GDP (PPP): $78.092 trillion
GDP Growth Rate: 3.3%
GDP Per Capita (PPP): $11,100
GDP By Sector: Services 63.4%, Industry 30.8%, Agriculture 5.8%
Growth In Trade Volume: 6.953%
Industrial Production Growth Rate: 4.6%
Population: 6.768 billion
Population Growth Rate: 1.133%
Urban Population: 50.5%
Urbanization Rate: 1.85% (125 million people move to cities every year)
The Poor (Income below $2 per day): Approx 3.25 billion (~ 50%)
Millionaires: Approx 10 million (~ 0.15%)
Labor Force: 3.232 billion
Inflation Rate - Developed Countries: 2.5%
Inflation Rate - Developing Countries: 5.6%
Unemployment Rate: 8.8%
Investment: 23.4% of GDP
Public Debt: 58.3% of GDP
Market Value of Publicly Traded Companies: $48.85 trillion, or 62.6% of World GDP
Sources: EconomyWatch.com Economic Statistics Database, CIA World Factbook, IMF, World Bank
The World Economy in 2010 was worth $74.007 trillion in GDP terms, using the Purchasing Price Parity (PPP) method of valuation. This is expected to grow to $78.092 trillion in 2011.
The overall global economy averaged a 3.2 per cent growth rate between 2000 and 2007, suffering a slight dip in 2001 - 2002 thanks to the Dot Com Crash, but continuing to grow throughout that period. In fact 2004 - 2007 were boom years. The Emerging Markets, led by the giants of China, India, Russia and Brazil (the BRIC countries) had been posting 7 per cent - 10 per cent growth rates for years. Property and stock market booms had brought consistent growth in North America and Europe. Investment was bringing economic development to much of the Middle East and Africa, and even Japan was recovering from its deflationary 'Lost Years'.
Economic conditions within these countries play a major role in setting the economic atmosphere of less well-to-do nations and their economies. In many aspects, developing and less developed economies depend on the developed countries for their economic wellbeing.
Theories were even circulating that thanks to the growth of the developing world, we might enjoy years of unfettered growth, as new markets would go through successive growth spurts and counter the effects of slowing growth elsewhere. It was suggested that Asia was 'decoupling' from the US and able to grow under its own steam thanks to its two 'Awakening Giants'.
Sadly, that turned out to be hogwash, as deregulation allowed western banks to build up unsustainable levels of debt that brought the global economy to the brink of depression.
As the 'Sub-Prime' Crisis morphed into a fully fledged crash then global Financial Crisis, 2008 started to bomb and 2009 became the first year that the world recorded a loss in GDP since World War II. 2.031% was wiped out of the global economy - or $3.3 trillion of value.
Sunday, September 25, 2011
Indian Agriculture
Indian Agriculture is one of the most important sector in the economy of the country. Agriculture in itself produces more than 18.5 percent of the Gross Domestic product of the country and more than 60 percent people out of Indian population are involved in this sector.
The Indian Agriculture also provides more than 8.5 percent of the total exportation of the Indian Economy. Indian Economy is becoming more and more dependent upon service sector and industrial sector, the Indian Agriculture still plays a vital role in the development of the Indian Economy.
The Monsoon also has a very important part in the Indian Agriculture. Because of the shortage of irrigation system in Indian Agriculture most of the farmers depend highly on rain falls. The amount of raining determines the nature of the crops and also the production. Indian Agriculture in the majority of state are looked after by the State Governments rater than Central Government.
Indian Agricultural Production
India is known to be the largest producer of milk and milk products, coconuts, cashew nuts, tea and other crops. Indian Agriculture after India has the largest out put in farming and it also comes second in producing crops like rice, wheat, rice and some other crops as well. In producing fruits like Banana and Sapota, Indian Agriculture is ranked one in the world
There are some factors that stops India from producing more crops in their fields:
•The farmers does not have enough land for themselves due to various reasons and the lands are also getting fragmented due to the ceiling acts and also due to family disputes.
•Illiteracy and the backwardness in the socio economic sphere also are responsible in stopping Indian Agriculture form growing more agricultural products.
•The use of technology is also not enough and unlike China, the farmers of India are not comfortable in using various agricultural technologies.
•The Indian Farmers are very much dependent on rain falls as there is not enough facility available for irrigation in most part of the country. So whether the crops would be good or bad depends entirely on the amount of rainfall in the country.
The Indian Agriculture also provides more than 8.5 percent of the total exportation of the Indian Economy. Indian Economy is becoming more and more dependent upon service sector and industrial sector, the Indian Agriculture still plays a vital role in the development of the Indian Economy.
The Monsoon also has a very important part in the Indian Agriculture. Because of the shortage of irrigation system in Indian Agriculture most of the farmers depend highly on rain falls. The amount of raining determines the nature of the crops and also the production. Indian Agriculture in the majority of state are looked after by the State Governments rater than Central Government.
Indian Agricultural Production
India is known to be the largest producer of milk and milk products, coconuts, cashew nuts, tea and other crops. Indian Agriculture after India has the largest out put in farming and it also comes second in producing crops like rice, wheat, rice and some other crops as well. In producing fruits like Banana and Sapota, Indian Agriculture is ranked one in the world
There are some factors that stops India from producing more crops in their fields:
•The farmers does not have enough land for themselves due to various reasons and the lands are also getting fragmented due to the ceiling acts and also due to family disputes.
•Illiteracy and the backwardness in the socio economic sphere also are responsible in stopping Indian Agriculture form growing more agricultural products.
•The use of technology is also not enough and unlike China, the farmers of India are not comfortable in using various agricultural technologies.
•The Indian Farmers are very much dependent on rain falls as there is not enough facility available for irrigation in most part of the country. So whether the crops would be good or bad depends entirely on the amount of rainfall in the country.
Understanding India's Foreign Trade Policy
Although India has steadily opened up its economy, its tariffs continue to be high when compared with other countries, and its investment norms are still restrictive. This leads some to see India as a ‘rapid globalizer’ while others still see it as a ‘highly protectionist’ economy.
Till the early 1990s, India was a closed economy: average tariffs exceeded 200 percent, quantitative restrictions on importswere extensive, and there were stringent restrictions on foreign investment. The country began to cautiously reform in the 1990s, liberalizing only under conditions of extreme necessity.
Since that time, trade reforms have produced remarkable results. India’s trade to GDP ratio has increased from 15 percent to 35 percent of GDPbetween 1990 and 2005, and the economy is now among the fastest growing in the world.
Average non-agricultural tariffs have fallen below 15 percent, quantitative restrictions on imports have been eliminated, and foreign investments norms have been relaxed for a number of sectors.
India however retains its right to protect when need arises. Agricultural tariffs average between 30-40 percent, anti-dumping measures have been liberally used to protect trade, and the country is among the few in the world that continue to ban foreign investment in retail trade. Although this policy has been somewhat relaxed recently, it remains considerably restrictive.
Nonetheless, in recent years, the government’s stand on trade and investment policy has displayed a marked shift from protecting ‘producers’ to benefiting ‘consumers’. This is reflected in its ForeignTrade Policy for 2004/09 which states that, "For India to become a major player in world trade ...we have also to facilitate those imports which are required to stimulate our economy."
India is now aggressively pushing for a more liberal global trade regime, especially in services. It has assumed a leadership role among developing nations in global trade negotiations, and played a critical part in the Doha negotiations.
Till the early 1990s, India was a closed economy: average tariffs exceeded 200 percent, quantitative restrictions on importswere extensive, and there were stringent restrictions on foreign investment. The country began to cautiously reform in the 1990s, liberalizing only under conditions of extreme necessity.
Since that time, trade reforms have produced remarkable results. India’s trade to GDP ratio has increased from 15 percent to 35 percent of GDPbetween 1990 and 2005, and the economy is now among the fastest growing in the world.
Average non-agricultural tariffs have fallen below 15 percent, quantitative restrictions on imports have been eliminated, and foreign investments norms have been relaxed for a number of sectors.
India however retains its right to protect when need arises. Agricultural tariffs average between 30-40 percent, anti-dumping measures have been liberally used to protect trade, and the country is among the few in the world that continue to ban foreign investment in retail trade. Although this policy has been somewhat relaxed recently, it remains considerably restrictive.
Nonetheless, in recent years, the government’s stand on trade and investment policy has displayed a marked shift from protecting ‘producers’ to benefiting ‘consumers’. This is reflected in its ForeignTrade Policy for 2004/09 which states that, "For India to become a major player in world trade ...we have also to facilitate those imports which are required to stimulate our economy."
India is now aggressively pushing for a more liberal global trade regime, especially in services. It has assumed a leadership role among developing nations in global trade negotiations, and played a critical part in the Doha negotiations.
US Economic Relations with India
Trade and commerce have been at the center of the US economic relations with India. There has been steady increase in this department. During 1990 the financial volume of the bilateral trade between the two countries had been 5.6 billion dollars. During the year 2004 the figure stood at 21.68 billion dollars, which was an improvement by 387%. In 2003 India had exported goods and services worth 13.05 billion United States dollars to the USA. In the next year there was a growth of 19.28% in the worth of goods exported to USA and the amount stood at 15.57 billion US dollars.
The United States exported goods worth 4.98 billion dollars to India in the year 2003 and in the next year the total worth of the goods exported to India by the US was 6.11 billion dollars. This was an addition of 22.69%. As per the information provided by the U.S. Department of Commerce, India exported merchandise worth 9737 million US dollars to US and the US exported merchandise worth 3757 million US dollars. In 2002 the US exported goods worth 4101 million US dollars and India exported goods worth 11818 million US dollars. In 2003 India exported merchandise worth 13055 million US dollars to the United States and the US exported 4980 million US dollars.
In 2004 the total worth of the merchandise exported by the United States to India was 6109 million US dollars and for India the amount stood at 15572 million US dollars. From the months of January to August in 2005 India had exported merchandise worth 5210 million US dollars and India had exported 12002 million US dollars worth merchandise to the US.
Over the years there have been certain goods that have been exported more often by India to US and the same is also true of the opposite. As far as India are concerned, the goods at the frontline are cut and polished diamonds as well as jewelry. Automobiles and parts, textile, organic chemicals and engineering equipments have also been occupying important positions in this context. In 2005 diamonds and precious stones were the leaders with 29% of the total goods exported. Textiles came second with 25% and iron and steel were third with 5.73%. Organic chemicals were 3.46% of the total exports made and electric machinery fifth with 3.24%.
In case of the US exports to India engineering equipments, optical and medical equipments, precious stones and metals, aircraft and other aviation equipments and organic chemicals have been the traditional ones. In 2005 the engineering equipments amounted to 30.20% of the total goods exported to India and precious stones and metals were second with 9.25%. Organic chemicals accounted for 7% of the total goods exported at that time like optical equipments. Aviation and aircraft accounted for 10.4% of the entire export of US to India
The United States exported goods worth 4.98 billion dollars to India in the year 2003 and in the next year the total worth of the goods exported to India by the US was 6.11 billion dollars. This was an addition of 22.69%. As per the information provided by the U.S. Department of Commerce, India exported merchandise worth 9737 million US dollars to US and the US exported merchandise worth 3757 million US dollars. In 2002 the US exported goods worth 4101 million US dollars and India exported goods worth 11818 million US dollars. In 2003 India exported merchandise worth 13055 million US dollars to the United States and the US exported 4980 million US dollars.
In 2004 the total worth of the merchandise exported by the United States to India was 6109 million US dollars and for India the amount stood at 15572 million US dollars. From the months of January to August in 2005 India had exported merchandise worth 5210 million US dollars and India had exported 12002 million US dollars worth merchandise to the US.
Over the years there have been certain goods that have been exported more often by India to US and the same is also true of the opposite. As far as India are concerned, the goods at the frontline are cut and polished diamonds as well as jewelry. Automobiles and parts, textile, organic chemicals and engineering equipments have also been occupying important positions in this context. In 2005 diamonds and precious stones were the leaders with 29% of the total goods exported. Textiles came second with 25% and iron and steel were third with 5.73%. Organic chemicals were 3.46% of the total exports made and electric machinery fifth with 3.24%.
In case of the US exports to India engineering equipments, optical and medical equipments, precious stones and metals, aircraft and other aviation equipments and organic chemicals have been the traditional ones. In 2005 the engineering equipments amounted to 30.20% of the total goods exported to India and precious stones and metals were second with 9.25%. Organic chemicals accounted for 7% of the total goods exported at that time like optical equipments. Aviation and aircraft accounted for 10.4% of the entire export of US to India
Indian Economy
India is a South Asian country that is the seventh largest in area and has the second largest population in the world. India covers an area of 3,287,240 square km (India geography) and its population stands at 1.215 billion people in 2010 (India population) . India has great plains, long coastlines and majestic mountains. Thus, the land has abundant resources. India shares its borders with China, Bangladesh, Pakistan, Nepal, Sri Lanka and Myanmar.
Understanding the Indian Economy
Large, dynamic and steadily expanding, the Indian economy is characterized by a huge workforce operating in many new sectors of opportunity.
The Indian economy is one of the fastest growing economies and is the 12th largest in terms of the market exchange rate at $1,430.02 billion (2010 India GDP). In terms ofpurchasing power parity, the Indian economy ranks the fourth largest in the world. However, poverty still remains a major concern besides disparity in income.
The Indian economy has been propelled by the liberalization policies that have been instrumental in boosting demand as well as trade volume. The growth rate has averaged around 7% since 1997 and India was able to keep its economy growing at a healthy rate even during the 2007-2009 recession, managing a 9.668 % growth rate in 2010 (India GDP Growth). The biggest boon to the economy has come in the shape of outsourcing. Its English speaking population has been instrumental in making India a preferred destination for information technology products as well as business process outsourcing.
The economy of India is as diverse as it is large, with a number of major sectors including manufacturing industries, agriculture, textiles and handicrafts, and services. Agriculture is a major component of the Indian economy, as over 66% of the Indian population earns its livelihood from this area.
However, the service sector is greatly expanding and has started to assume an increasingly important role. The fact that the Indian speaking population in India is growing by the day means that India has become a hub of outsourcing activities for some of the major economies of the world including the United Kingdom and the United States. Outsourcing to India has been primarily in the areas of technical support and customer services.
Other areas where India is expected to make progress include manufacturing, construction of ships, pharmaceuticals, aviation, biotechnology, tourism, nanotechnology, retailing and telecommunications. Growth rates in these sectors are expected to increase dramatically.
Despite the liberalization the economy still largely controlled by the government and the 500+ major companies it owns, which together are worth around US$500 billion, or around 40% of GDP at current exchange rates. Thanks to past profligate spending, government debt is running at around 80% of GDP. Servicing the interest payments on that debt is now the single largest component of the federal budget. Fiscal discipline and deficit reduction is therefore vital for India's future prospects.
It is also crucial to understand that India is driven primarily by domestic (consumer) consumption. This stands in marked contrast to Japan, the Asian Tigers and now China, all of whom have followed the export-oriented model.
With the massive growth of the Indian middle class, this vast country may become Asia's first major 'buy' economy.
Understanding the Indian Economy
Large, dynamic and steadily expanding, the Indian economy is characterized by a huge workforce operating in many new sectors of opportunity.
The Indian economy is one of the fastest growing economies and is the 12th largest in terms of the market exchange rate at $1,430.02 billion (2010 India GDP). In terms ofpurchasing power parity, the Indian economy ranks the fourth largest in the world. However, poverty still remains a major concern besides disparity in income.
The Indian economy has been propelled by the liberalization policies that have been instrumental in boosting demand as well as trade volume. The growth rate has averaged around 7% since 1997 and India was able to keep its economy growing at a healthy rate even during the 2007-2009 recession, managing a 9.668 % growth rate in 2010 (India GDP Growth). The biggest boon to the economy has come in the shape of outsourcing. Its English speaking population has been instrumental in making India a preferred destination for information technology products as well as business process outsourcing.
The economy of India is as diverse as it is large, with a number of major sectors including manufacturing industries, agriculture, textiles and handicrafts, and services. Agriculture is a major component of the Indian economy, as over 66% of the Indian population earns its livelihood from this area.
However, the service sector is greatly expanding and has started to assume an increasingly important role. The fact that the Indian speaking population in India is growing by the day means that India has become a hub of outsourcing activities for some of the major economies of the world including the United Kingdom and the United States. Outsourcing to India has been primarily in the areas of technical support and customer services.
Other areas where India is expected to make progress include manufacturing, construction of ships, pharmaceuticals, aviation, biotechnology, tourism, nanotechnology, retailing and telecommunications. Growth rates in these sectors are expected to increase dramatically.
Despite the liberalization the economy still largely controlled by the government and the 500+ major companies it owns, which together are worth around US$500 billion, or around 40% of GDP at current exchange rates. Thanks to past profligate spending, government debt is running at around 80% of GDP. Servicing the interest payments on that debt is now the single largest component of the federal budget. Fiscal discipline and deficit reduction is therefore vital for India's future prospects.
It is also crucial to understand that India is driven primarily by domestic (consumer) consumption. This stands in marked contrast to Japan, the Asian Tigers and now China, all of whom have followed the export-oriented model.
With the massive growth of the Indian middle class, this vast country may become Asia's first major 'buy' economy.
China Trade, Imports and Exports
As part of China's continuing effort to become competitive in the global marketplace, China joined the World Trade Organization in 2001. China's entry into the WTO has benefited coastal cities, especially in the southeast. Although a British crown colony until its return to Chinese control in 1997, Hong Kong has long been a major maritime outlet of South China.
China Exports
In 2010, China exports totaled $1.194 trillion, down from $1.429 trillion in 2008. It’s main exports are electrical goods and other machinery, including data processing equipment, apparel, textiles, iron and steel, optical and medical equipment;
China's main export partners are US (17.7%), Hong Kong (13.3%), Japan (8.1%), South Korea (5.2%) and Germany (4.1%)
China Imports
In 2010, China imports totaled $921.5 billion, down from $1.131 trillion in 2008. It’s main imports are electrical components and other machinery, oil and mineral fuels, optical and medical equipment, metal ores, plastics and organic chemicals;
China's main import partners are Japan (13.3%), South Korea (9.9%), US (7.2%) and Germany (4.9%).
CHALLENGES FACING CHINA
In the early 21st century, China faced the challenge of balancing its highly centralized political system with an increasingly decentralized economic system.
Also, China's economy, though strengthened by liberal economic policies of the 1980s and 90s, continues to suffer from inadequate transportation, communication, and energy resources. However, since the 1980s, China has undertaken a major highway construction program and China is working hard on building world-class infrastructure.
China's poor human development index highlights the economic disparity between urban China and the rural hinterlands. Human rights campaigners continue to criticize China for executing hundreds of people every year and for failing to stop torture.
Other critical problems include corruption, which affects every level of society, and the growing rate of HIV infection. Tensions between a highly centralized political - and an increasingly de-centralized economic system is also a cause of tension.
Another long term threat to China's continued economic growth is the deterioration in the environment, notably air pollution, soil erosion and the steady fall of its water table in the north.
China Exports
In 2010, China exports totaled $1.194 trillion, down from $1.429 trillion in 2008. It’s main exports are electrical goods and other machinery, including data processing equipment, apparel, textiles, iron and steel, optical and medical equipment;
China's main export partners are US (17.7%), Hong Kong (13.3%), Japan (8.1%), South Korea (5.2%) and Germany (4.1%)
China Imports
In 2010, China imports totaled $921.5 billion, down from $1.131 trillion in 2008. It’s main imports are electrical components and other machinery, oil and mineral fuels, optical and medical equipment, metal ores, plastics and organic chemicals;
China's main import partners are Japan (13.3%), South Korea (9.9%), US (7.2%) and Germany (4.9%).
CHALLENGES FACING CHINA
In the early 21st century, China faced the challenge of balancing its highly centralized political system with an increasingly decentralized economic system.
Also, China's economy, though strengthened by liberal economic policies of the 1980s and 90s, continues to suffer from inadequate transportation, communication, and energy resources. However, since the 1980s, China has undertaken a major highway construction program and China is working hard on building world-class infrastructure.
China's poor human development index highlights the economic disparity between urban China and the rural hinterlands. Human rights campaigners continue to criticize China for executing hundreds of people every year and for failing to stop torture.
Other critical problems include corruption, which affects every level of society, and the growing rate of HIV infection. Tensions between a highly centralized political - and an increasingly de-centralized economic system is also a cause of tension.
Another long term threat to China's continued economic growth is the deterioration in the environment, notably air pollution, soil erosion and the steady fall of its water table in the north.
Economic Relationship among SAARC Nations
The South Asian Association for Regional Cooperation or SAARC was created to promote economic integrity and cooperation among 7 South Asian nations namely India, Bangladesh, Pakistan, Bhutan, Nepal, Maldives, and Sri Lanka. The Association was formed in 1985 with the aim to ensure social and economic development of the member countries. However, over the years it has been seen that SAARC mainly worked towards development of economic relationship among the SAARC nations. Attempts are also on to further trade relations with the member nations of ASEAN (Association of South East Asian Nations) and the European Union.
In spite of lying in the vicinity of one another, trading activities were restricted among the SAARC nations. Over the years, there has significant improvement in the trade relations among the seven SAARC members. The focus has been shifted to get access to the markets of the other members. Methods have also been devised to attract foreign direct investments to strengthen economic infrastructures of the SAARC nations. All these initiatives point towards an improvement in the economic relationship among the 7 South Asian countries.
Despite the sincere attempts of the Association, there are several factors that stand in the way of economic integrity among the SAARC nations. The clashes between India and the neighboring countries have prevented the SAARC members to make the most of the economic benefits derived from the Association. This has prompted the South Asian countries to go for bilateral trading activities instead of getting involved in multilateral trade agreements. However, the Association is expected to take more proactive steps to improve the economic relationship among its members. Besides devising policies for economic integration, SAARC is supposed to function as a medium to facilitate discussions among the South Asian nations. Seminars and conferences are going to be helpful measures for promoting cross border trade and investment.
As an aftermath of globalization, Indian government has resorted to open trade policy. The economic reforms of early 1990s have opened an array of challenges for the Indian entrepreneurs. The growth rate of the Indian economy was around 7% during the period from 1994-1997. The inflow of foreign fund also recorded substantial increase.
All these resulted from the flexible economic policies adopted by the Indian government. The economic prosperity of India prompted the other SAARC members to seek resort to international trade as a platform for economic growth. Both Sri Lanka and Nepal have shown their interests to enhance intra regional trade. Bangladesh is also following the same trend. With the increased intra regional trading activities, the economic relationship among the SAARC nations is bound to be stronger in future.
In spite of lying in the vicinity of one another, trading activities were restricted among the SAARC nations. Over the years, there has significant improvement in the trade relations among the seven SAARC members. The focus has been shifted to get access to the markets of the other members. Methods have also been devised to attract foreign direct investments to strengthen economic infrastructures of the SAARC nations. All these initiatives point towards an improvement in the economic relationship among the 7 South Asian countries.
Despite the sincere attempts of the Association, there are several factors that stand in the way of economic integrity among the SAARC nations. The clashes between India and the neighboring countries have prevented the SAARC members to make the most of the economic benefits derived from the Association. This has prompted the South Asian countries to go for bilateral trading activities instead of getting involved in multilateral trade agreements. However, the Association is expected to take more proactive steps to improve the economic relationship among its members. Besides devising policies for economic integration, SAARC is supposed to function as a medium to facilitate discussions among the South Asian nations. Seminars and conferences are going to be helpful measures for promoting cross border trade and investment.
As an aftermath of globalization, Indian government has resorted to open trade policy. The economic reforms of early 1990s have opened an array of challenges for the Indian entrepreneurs. The growth rate of the Indian economy was around 7% during the period from 1994-1997. The inflow of foreign fund also recorded substantial increase.
All these resulted from the flexible economic policies adopted by the Indian government. The economic prosperity of India prompted the other SAARC members to seek resort to international trade as a platform for economic growth. Both Sri Lanka and Nepal have shown their interests to enhance intra regional trade. Bangladesh is also following the same trend. With the increased intra regional trading activities, the economic relationship among the SAARC nations is bound to be stronger in future.
US Economic Relations with Singapore
Singapore is one of the closet allies of the United States in South-East Asia. The US economic relations with Singapore is a manifestation of the friendly relations it has with this South-East Asian nation.
The United States of America has traditionally had strong trade relations with Singapore. Singapore is the eleventh largest trading partner of the United States of America. The United States, on the other hand is the second largest trading partner of Singapore. At the turn of the century, in 2001, the total trade between the two countries amounted to 67.7 billion US dollars. This constituted 15.9% of the overall aggregate trade of Singapore.
The major import items of the United States from Singapore are -
• Computers
• Printers and peripherals
• Disk drives
• Computer parts
• Printed Circuit Boards Assembled (PCBAs)
• Telecommunication equipment
• ICs and semiconductors
• Organo-inorganic componds
The major export items of the United States to Singapore are -
• Aircrafts and aircraft parts
• Printed Circuit Boards Assembled (PCBAs)
• ICs and semiconductors
• Civil engineering equipment
• Scientific instruments and apparatus
• Computer parts
Singapore has also attracted major investments rom the United States largely due to its open-door investment policies and its highly developed business infrastructure. More than 1300 US companies have invested in Singapore. Almost 330 US companies have set up their regional business headquarters in Singapore. In 1999, half of the Foreign Direct Investments (FDI) of the United States in Asia were channelled to Singapore. Out of the 6.8 billion US Dollars of FDI for the Asia-Pacific region, 3.4 billion US Dollars went to Singapore. This made Singapore the most preffered destination in Asia among US investors. The sectors fo the Singapore economy that received the major share of the FDI from the United States of America are the industrial machinery sector and the electronics sector.
The major highlights of US economic relations with Singapore
• Trade and Investment Framework Agreement - 1991
• Singapore-US Business Council (SUBC) - 1995
• MOU (Memoranda of Understanding) with Trade and Commerce Agency of California, and Boston
• Trade representative offices in Singapore of US States and Ports
• The Us and Singapore also collaborate closely in international settings like APEC and WTO.
In order to collaborate closely with the government of the United States of America and the private sector in the US, Singapore has set up offices in New York and Washington DC.
The United States of America has traditionally had strong trade relations with Singapore. Singapore is the eleventh largest trading partner of the United States of America. The United States, on the other hand is the second largest trading partner of Singapore. At the turn of the century, in 2001, the total trade between the two countries amounted to 67.7 billion US dollars. This constituted 15.9% of the overall aggregate trade of Singapore.
The major import items of the United States from Singapore are -
• Computers
• Printers and peripherals
• Disk drives
• Computer parts
• Printed Circuit Boards Assembled (PCBAs)
• Telecommunication equipment
• ICs and semiconductors
• Organo-inorganic componds
The major export items of the United States to Singapore are -
• Aircrafts and aircraft parts
• Printed Circuit Boards Assembled (PCBAs)
• ICs and semiconductors
• Civil engineering equipment
• Scientific instruments and apparatus
• Computer parts
Singapore has also attracted major investments rom the United States largely due to its open-door investment policies and its highly developed business infrastructure. More than 1300 US companies have invested in Singapore. Almost 330 US companies have set up their regional business headquarters in Singapore. In 1999, half of the Foreign Direct Investments (FDI) of the United States in Asia were channelled to Singapore. Out of the 6.8 billion US Dollars of FDI for the Asia-Pacific region, 3.4 billion US Dollars went to Singapore. This made Singapore the most preffered destination in Asia among US investors. The sectors fo the Singapore economy that received the major share of the FDI from the United States of America are the industrial machinery sector and the electronics sector.
The major highlights of US economic relations with Singapore
• Trade and Investment Framework Agreement - 1991
• Singapore-US Business Council (SUBC) - 1995
• MOU (Memoranda of Understanding) with Trade and Commerce Agency of California, and Boston
• Trade representative offices in Singapore of US States and Ports
• The Us and Singapore also collaborate closely in international settings like APEC and WTO.
In order to collaborate closely with the government of the United States of America and the private sector in the US, Singapore has set up offices in New York and Washington DC.
China's Economic Relations with Singapore
It had been expected that the bilateral trade between the two countries were supposed to amount to 12 billion United States dollars. It would have been a record at that point of time. As per the statistics of the Trade Development Board of Singapore, bilateral trade between the two countries started during the year 1958.
According to available data, the bilateral trade between China and Singapore amounted to 11.28 billion up till the month of November in the year 2000. This was an improvement of 33.09% from the amount reached at the same period in 1999. This amount placed China in the top six trade partners of Singapore. The improvement of 33.09% in the trade between Singapore and China was substantially more than the 23.95% addition in the complete trade volume of Singapore in the same economic period. The total value of the bilateral trades, participated in by Singapore, was 247.7 billion United States dollars.
During January to November, 2000 Singapore exported goods and services worth 4.84 billion United States dollars. This was an improvement by 39.97%. The country imported goods and services worth 6.4 billion United States dollars from China and this was an improvement of 28.33%.
The officers working at the Economic and Commercial Counselor's Office in the Chinese Embassy in Singapore are of the opinion that bilateral trade in China and Singapore has increased as a result of the significant development of the economies of Singapore and China. Both the countries have also been able to make the most of their respective trade structures.
The experts have also observed that the ten best products that had been imported by Singapore from China were electronic goods that had high financial worth. Singapore also imported raw zinc from China, besides accessories and parts of equipments needed for autoprocessing. Also on the list are printed circuit boards, mini-motors, integrated circuits and disk drives of 3.5 inches. All these accounted for 35% of the total amount of goods imported by Singapore from China.
Of the products that were exported by Singapore to China petroleum and electronic goods occupied the pride of place. However, Singapore also exported other items like printed circuit boards, industrial refrigerating equipments and monointegrated circuits. All these items together were 37% of all the goods that had been exported by Singapore to China. As per the experts, the list of items that had been exported by Singapore to China reflects the fact that Singapore has the upper hand over China as far as oil refinery and electronics industries are concerned.
According to available data, the bilateral trade between China and Singapore amounted to 11.28 billion up till the month of November in the year 2000. This was an improvement of 33.09% from the amount reached at the same period in 1999. This amount placed China in the top six trade partners of Singapore. The improvement of 33.09% in the trade between Singapore and China was substantially more than the 23.95% addition in the complete trade volume of Singapore in the same economic period. The total value of the bilateral trades, participated in by Singapore, was 247.7 billion United States dollars.
During January to November, 2000 Singapore exported goods and services worth 4.84 billion United States dollars. This was an improvement by 39.97%. The country imported goods and services worth 6.4 billion United States dollars from China and this was an improvement of 28.33%.
The officers working at the Economic and Commercial Counselor's Office in the Chinese Embassy in Singapore are of the opinion that bilateral trade in China and Singapore has increased as a result of the significant development of the economies of Singapore and China. Both the countries have also been able to make the most of their respective trade structures.
The experts have also observed that the ten best products that had been imported by Singapore from China were electronic goods that had high financial worth. Singapore also imported raw zinc from China, besides accessories and parts of equipments needed for autoprocessing. Also on the list are printed circuit boards, mini-motors, integrated circuits and disk drives of 3.5 inches. All these accounted for 35% of the total amount of goods imported by Singapore from China.
Of the products that were exported by Singapore to China petroleum and electronic goods occupied the pride of place. However, Singapore also exported other items like printed circuit boards, industrial refrigerating equipments and monointegrated circuits. All these items together were 37% of all the goods that had been exported by Singapore to China. As per the experts, the list of items that had been exported by Singapore to China reflects the fact that Singapore has the upper hand over China as far as oil refinery and electronics industries are concerned.
China's Economic Relations with Japan
China's economic relations with Japan go back to the 7th century AD. This was the time when maritime trade was flourishing between the countries. The kingdoms of Silla and Baekje, which were Korean kingdoms, essayed the role of middlemen. After the fall of the Baekje kingdom in 663 AD Japan had to trade directly with the Chinese as the kingdom of Silla was hostile as a result of the Tang imperialism, which was rampant at that point of time.
Even though the Japanese were not exactly adept at carrying on sea trade at long distances they were able to go on trading. Some historians are of the opinion that this was possible as a result of the expertise of the expatriates of the Baekje kingdom, who helped them amend the making of their ships and also improve on their sea faring skills.
After the Second World War the economic ties between the two countries resumed in the 1960s. This was brought about by the withdrawal of the economical experts from the country by the Soviet Russia. This incident compelled China to resume their economic ties with Japan as that was one of the few viable alternatives thye had at that point of time.
The diplomatic relations between the two Asian countries were formally initiated on the 29th of September, 1972. As per the statistics of the Ministry of Justice in December, 2006 there were 519,561 Chinese nationals staying in Japan. According to the statistics of the year 2005 there were 114,899 Japanese people staying in China and these figures include Hong Kong as well. During the year 2006 China exported goods worth 118.4 billion dollars to Japan and imported goods worth 92.9 billion dollars from Japan. Till the year 2006 Japan has invested 58.2 billion dollars in China.
In the recent year the political relations between Japan and China have not been exactly peaceful. However, it is not expected to have any bearing on the economic relations between the two Asian powerhouses. During the year 2004 China substituted the United States of America as one of the major trading partner of Japan.
The economic experts are of the opinion that macro-economic scenario in the two countries looks to be good enough for the economic relations between the two countries prosper. One of the major factors in this case is the reduction in the difference between the import and export of the country. The goods and services of China are being deemed as being more marketable and this has certainly played a crucial role in the economic relations between China and Japan.
Even though the Japanese were not exactly adept at carrying on sea trade at long distances they were able to go on trading. Some historians are of the opinion that this was possible as a result of the expertise of the expatriates of the Baekje kingdom, who helped them amend the making of their ships and also improve on their sea faring skills.
After the Second World War the economic ties between the two countries resumed in the 1960s. This was brought about by the withdrawal of the economical experts from the country by the Soviet Russia. This incident compelled China to resume their economic ties with Japan as that was one of the few viable alternatives thye had at that point of time.
The diplomatic relations between the two Asian countries were formally initiated on the 29th of September, 1972. As per the statistics of the Ministry of Justice in December, 2006 there were 519,561 Chinese nationals staying in Japan. According to the statistics of the year 2005 there were 114,899 Japanese people staying in China and these figures include Hong Kong as well. During the year 2006 China exported goods worth 118.4 billion dollars to Japan and imported goods worth 92.9 billion dollars from Japan. Till the year 2006 Japan has invested 58.2 billion dollars in China.
In the recent year the political relations between Japan and China have not been exactly peaceful. However, it is not expected to have any bearing on the economic relations between the two Asian powerhouses. During the year 2004 China substituted the United States of America as one of the major trading partner of Japan.
The economic experts are of the opinion that macro-economic scenario in the two countries looks to be good enough for the economic relations between the two countries prosper. One of the major factors in this case is the reduction in the difference between the import and export of the country. The goods and services of China are being deemed as being more marketable and this has certainly played a crucial role in the economic relations between China and Japan.
History of China's Economic Relations with India: An Overview
The history of bilateral relations between China and India dates back to mid 1980s. The process of dialogue initiated by the governments of the two countries at that point of time was quite helpful in identifying the common trade interests. Efforts were initiated to make the most of their economic strengths so as to further the economic relations between India and China. In the year1984, China and India entered into a Trade Agreement, which provided them with the status of Most Favored Nation or MFN. It was in 1992 that the China and India got involved in a full-fledged bilateral trade relation. The year 1994 marked the beginning of a new era in the China-India economic relations. In this year a Double Taxation Avoidance Agreement was signed between India and China. The governments of both the countries also took the necessary initiative to turn into dialogue partners in the Association of Southeast Asian Nations (ASEAN).
Both India and China hold more or less same positions in the global economic scenario. This in turn has further enhanced the economic relations between the two countries. In 2003, Bangkok Agreement was signed between the two countries. Under this agreement both China and India offered some trade preferences to each other. India provided concessions on 188 products exported from China. On the other hand, China provided preferences on tariff for 217 products exported from India. The economic relations between the two nations is expected to improve aided by the flourishing IT and ITES sector, biotechnology industry, health sector, and financial sector. The bilateral trade between the two countries is expected to reach 20 billion US dollars by the year 2008. The projected figure for 2010 is 30 billion US dollars.
In 2003, China and India entered into an agreement to initiate open border trade via the Silk Route. The two countries have also shown interest to take part in a multilateral trade system as per the WTO commitments.
Around 90 Indian companies have set up braches in China. These companies mostly operate in the pharmaceutical sector, IT and ITES sector, and automotive industry. Some of these companies are Satyam, Wipro, TCS, Ranbaxy, and many more.
China has already been the top trading partner of India in the recent time. The economic relation between the two countries is considered to be one of the most significant bilateral relations in the contemporary global economic scenario and this trend is expected to continue in the years to come.
Both India and China hold more or less same positions in the global economic scenario. This in turn has further enhanced the economic relations between the two countries. In 2003, Bangkok Agreement was signed between the two countries. Under this agreement both China and India offered some trade preferences to each other. India provided concessions on 188 products exported from China. On the other hand, China provided preferences on tariff for 217 products exported from India. The economic relations between the two nations is expected to improve aided by the flourishing IT and ITES sector, biotechnology industry, health sector, and financial sector. The bilateral trade between the two countries is expected to reach 20 billion US dollars by the year 2008. The projected figure for 2010 is 30 billion US dollars.
In 2003, China and India entered into an agreement to initiate open border trade via the Silk Route. The two countries have also shown interest to take part in a multilateral trade system as per the WTO commitments.
Around 90 Indian companies have set up braches in China. These companies mostly operate in the pharmaceutical sector, IT and ITES sector, and automotive industry. Some of these companies are Satyam, Wipro, TCS, Ranbaxy, and many more.
China has already been the top trading partner of India in the recent time. The economic relation between the two countries is considered to be one of the most significant bilateral relations in the contemporary global economic scenario and this trend is expected to continue in the years to come.
China's Economic Relations
China's economic relations crucially depend on bilateral trade with the other nations of the world. The economic relations of China have undergone substantial changes since it has joined the World Trade Organization in the year 2001. As an aftermath of the WTO agreements, the Chinese government has followed the open trade policy.
The free trading system has further expanded the economic relations of China with its trade partners, uninterrupted by all types of trade barriers. This transition of Chinese economy to an open market-oriented economy has been highly beneficial for the all-round growth of China.
China's Economic Relations with the US
China's economic relation with US has expanded significantly with China joining the World Trade Organization in the year of 2001. Over the years China has emerged as the most potential market for American exports. US goods export to China amounted to $41.8 billion in 2005. This figure was 20% more than the corresponding figure in the year 2004.
When it comes to US farm exports, China happens to be the fourth biggest export market of US; the other three markets being Canada, Japan, and Mexico. During the period from 2001 to 2005, Chinese exports to US have also increased substantially. In monetary terms, the volume of exports from China to US has increased from worth 102 billion US dollars to 243.5 billion US dollars.
China's economic relations with US took a different turn in 2005, with America acquiring around 23% of the good exports from China. This bilateral trade involved a trade deficit amounting to US $201.6 billion with China, the highest ever trade deficit seen in bilateral trade. There are different factors that resulted in this trade deficit. Some of the major factors are as follows:
•The US demand for Chinese goods exports was much higher than the amount that was exported from China.
•Restrictions imposed on US prevented the American traders to get into some crucial sectors of the Chinese economy.
•The China-US trade deficit is considered as a part of the US trade deficit with East Asia. As the trade deficit with Asia has continued to remain the same over the last decade, the trade deficit with China only added to this problem.
To improve the economic relation between China and America, the US government has adopted different policies from time to time. The primary objective of all these policies is to push the Chinese government towards implementing a more liberalized economic structure. This is turn facilitates the process of correcting the imbalances of the Chinese economy. The US government is working with the reformers and political leaders of China to promote bilateral trade between the two countries. The US government is also trying to ensure China's compliance with the commitments of the World Trade Organization.
The US direct investments in China constitute an important part of China's economic relations with US. The Chinese petrochemical sector, manufacturing sector, and hospitality industry are some of the preferred areas of investment by the US investors. More than 100 multinational corporations based in the United States are having their operations in China. US cultivated investment in China has been more than $54 billions.All these act as positive catalysts in facilitating China's economic relations with US.
The free trading system has further expanded the economic relations of China with its trade partners, uninterrupted by all types of trade barriers. This transition of Chinese economy to an open market-oriented economy has been highly beneficial for the all-round growth of China.
China's Economic Relations with the US
China's economic relation with US has expanded significantly with China joining the World Trade Organization in the year of 2001. Over the years China has emerged as the most potential market for American exports. US goods export to China amounted to $41.8 billion in 2005. This figure was 20% more than the corresponding figure in the year 2004.
When it comes to US farm exports, China happens to be the fourth biggest export market of US; the other three markets being Canada, Japan, and Mexico. During the period from 2001 to 2005, Chinese exports to US have also increased substantially. In monetary terms, the volume of exports from China to US has increased from worth 102 billion US dollars to 243.5 billion US dollars.
China's economic relations with US took a different turn in 2005, with America acquiring around 23% of the good exports from China. This bilateral trade involved a trade deficit amounting to US $201.6 billion with China, the highest ever trade deficit seen in bilateral trade. There are different factors that resulted in this trade deficit. Some of the major factors are as follows:
•The US demand for Chinese goods exports was much higher than the amount that was exported from China.
•Restrictions imposed on US prevented the American traders to get into some crucial sectors of the Chinese economy.
•The China-US trade deficit is considered as a part of the US trade deficit with East Asia. As the trade deficit with Asia has continued to remain the same over the last decade, the trade deficit with China only added to this problem.
To improve the economic relation between China and America, the US government has adopted different policies from time to time. The primary objective of all these policies is to push the Chinese government towards implementing a more liberalized economic structure. This is turn facilitates the process of correcting the imbalances of the Chinese economy. The US government is working with the reformers and political leaders of China to promote bilateral trade between the two countries. The US government is also trying to ensure China's compliance with the commitments of the World Trade Organization.
The US direct investments in China constitute an important part of China's economic relations with US. The Chinese petrochemical sector, manufacturing sector, and hospitality industry are some of the preferred areas of investment by the US investors. More than 100 multinational corporations based in the United States are having their operations in China. US cultivated investment in China has been more than $54 billions.All these act as positive catalysts in facilitating China's economic relations with US.
China Economic Development
China economic growth has been acknowledged by many as remarkable. In a very short span of time, it has grown to become one of world's largest economies. It is predicted that by 2035, Chinese economy is likely to overcome that of United States of America. Credit for this remarkable economic growth of China goes to its communist government, which adopted several economic reforms and measures aiming for economic development.
Global economic slowdown
Global economic slowdown has affected this Asian giant, although its effects have not been as pronounced as in other countries. International organizations like International Monetary Fund have predicted a slowdown in Chinese economic growth for 2009. However this is unlikely to affect economic development in China.
China stimulus package
To counter economic pressures imposed by global economic crisis, China has announced an economic stimulus package of about 4 trillion yuan or $585 billion. A large part of this money would be utilized for economic development of this nation. It remains to be seen if this package is going to help China to boost its economy.
Investment on infrastructure projects
A major part of China's economic stimulus package would be utilized for infrastructure projects in that nation. Existing infrastructure and housing projects are likely to receive a boost following infusion of economic stimulus money.
About 7.5 billion yuan have been set aside for low-rent housing projects in China. This is in addition to about 2 billion yuan that had already been put on low-rent housing projects in China. Economic development of China will take place with investment in infrastructure projects that include railroad, water conservancy, and highways.
Corruption
Corruption at local government level has been a major challenge for China's national government. It has been one major problem that acts as an hindrance to China economic development. Lack of accountability of persons and money distributed to local governments for public utility services is a major area of concern for China.
Global economic slowdown
Global economic slowdown has affected this Asian giant, although its effects have not been as pronounced as in other countries. International organizations like International Monetary Fund have predicted a slowdown in Chinese economic growth for 2009. However this is unlikely to affect economic development in China.
China stimulus package
To counter economic pressures imposed by global economic crisis, China has announced an economic stimulus package of about 4 trillion yuan or $585 billion. A large part of this money would be utilized for economic development of this nation. It remains to be seen if this package is going to help China to boost its economy.
Investment on infrastructure projects
A major part of China's economic stimulus package would be utilized for infrastructure projects in that nation. Existing infrastructure and housing projects are likely to receive a boost following infusion of economic stimulus money.
About 7.5 billion yuan have been set aside for low-rent housing projects in China. This is in addition to about 2 billion yuan that had already been put on low-rent housing projects in China. Economic development of China will take place with investment in infrastructure projects that include railroad, water conservancy, and highways.
Corruption
Corruption at local government level has been a major challenge for China's national government. It has been one major problem that acts as an hindrance to China economic development. Lack of accountability of persons and money distributed to local governments for public utility services is a major area of concern for China.
China Economic Growth
About China economic growth
Rate of China economic growth has been consistent over last few financial years. In last 25 years, average rate of growth of annual gross domestic product has been more than 10 percent. Rate of growth of per capita income in China had grown at a rate of over 8 percent, in last thirty years. This has helped to bring down levels of poverty in China.
However, there is yet another side to these startling statistics. Even though levels of income have increased in China, inequalities and disparities within Chinese population have gone up.
Non governmental sector of Chinese economy
Non governmental sector of Chinese economy has grown at a good pace in last few years and Chinese economy has been made accessible to investors from different parts of world. This has increased volume of foreign investment and trading opportunities in China. As far as 2007 fiscal is concerned, China's economic growth has been accentuated by private sector and not by exports.
Governmental efforts and Chinese economic growth
In recent times, Chinese government has been trying to put stress on foreign trade as a means of accentuating economic growth of China. Between financial years 1949 to 1980, Chinese government brought about new industries that kicked off a long sequence of Chinese economic growth.
In initial five year plan from 1953 to 1957, heavy industries were focus of economic development in China. During 1980s, Chinese government followed a series of plans that helped them to achieve an average of 10 percent growth per year.
In decade of 1990 to 2000s, growth rate of Chinese economy came down a little. They started taking speculative loans based on an assumption that China was facing hyperinflation. Rates of interest were raised and investment projects were evaluated again. From 1996 fiscal onwards there was a slump that ran for three years as an after effect of ongoing Asian Financial Crisis, even as exports reduced and foreign direct investment came down.
A major challenge facing Chinese economy at present is maintaining high levels of growth achieved in recent years. It is important for China to keep its high rate of economic growth going so that it can sustain its job market.
Rate of China economic growth has been consistent over last few financial years. In last 25 years, average rate of growth of annual gross domestic product has been more than 10 percent. Rate of growth of per capita income in China had grown at a rate of over 8 percent, in last thirty years. This has helped to bring down levels of poverty in China.
However, there is yet another side to these startling statistics. Even though levels of income have increased in China, inequalities and disparities within Chinese population have gone up.
Non governmental sector of Chinese economy
Non governmental sector of Chinese economy has grown at a good pace in last few years and Chinese economy has been made accessible to investors from different parts of world. This has increased volume of foreign investment and trading opportunities in China. As far as 2007 fiscal is concerned, China's economic growth has been accentuated by private sector and not by exports.
Governmental efforts and Chinese economic growth
In recent times, Chinese government has been trying to put stress on foreign trade as a means of accentuating economic growth of China. Between financial years 1949 to 1980, Chinese government brought about new industries that kicked off a long sequence of Chinese economic growth.
In initial five year plan from 1953 to 1957, heavy industries were focus of economic development in China. During 1980s, Chinese government followed a series of plans that helped them to achieve an average of 10 percent growth per year.
In decade of 1990 to 2000s, growth rate of Chinese economy came down a little. They started taking speculative loans based on an assumption that China was facing hyperinflation. Rates of interest were raised and investment projects were evaluated again. From 1996 fiscal onwards there was a slump that ran for three years as an after effect of ongoing Asian Financial Crisis, even as exports reduced and foreign direct investment came down.
A major challenge facing Chinese economy at present is maintaining high levels of growth achieved in recent years. It is important for China to keep its high rate of economic growth going so that it can sustain its job market.
China's Global Economy
The Chinese economy, in a state of autarky since the days of Mao Zedong experienced some radical transformations after Deng Xiaoping took over in 1978. From being an excessively centrally planned economy it matured to a more open economy from his time and is now the growth engine for the world economy for the past ten years. Driven by rapid economic growth and rising incomes, the standard of living has risen and consumer goods such as cars and television sets which were once reserved for the elite are now within the grasp of the common man. Between 1978 and 2002, the amount of goods passing through Chinese ports had increased ten fold and the number of foreign visitors to the country had crossed over a million.
China grew at a rapid pace as a result of these reforms and opened its economy to the world for trade and direct foreign investment.
China has adopted a slow but steady method in implementing economic reforms. It has also sold the equity of some of its major Chinese state banks to overseas companies and bond markets. In recent years, China's role in international trade has also increased.
China, the fourth largest country in terms of size after Russia, Canada and the USA is now the world’s second largesteconomy after the USA if adjusted for differences in cost of living (purchasing power parity differences) although it is only about 10% of the US economy in dollar terms. Tremendous comparative advantage in terms of cheap labour and low production costs has given Chinese goods an edge over others in the world markets.
Data for the past three years reveal that the country has been maintaining a high growth rate in the GDPof around 8% to 10% annually. The upward trend in the country’s GDP, GNI as well as the per capita GDP reaching a high of around $1700 in 2005 has been continually maintained throughout the year 2006.
Increase in merchandise trade showed the tremendous growth in the country’s exports in the recent years. China has also been successful in stabilizing inflation rates after it reached a high of around 7% in 2004. The rise in Chinese worker’s remittances from abroad gas also contributed to a growth in the country’s GNI.
One of the defining features for the Chinese economy came on the 11th of December, 2001 when it became a member of the World Trade Organization or WTO. The Chinese accession to the WTO meant that Chinese economy opened up more to the rest of the world and its trade with Japan and the ASEAN nations (Association of South-East Asian Nations) increased rapidly. China drastically reduced its tariff rates from 16.7% in 2001 to 12% in 2002 and significant steps for reducing the number of items on its import license or quota which was 300 in 2002 are presently underway. Notably, India’s exports to China quadrupled from less than 1% in 1995 to more 4.5% in 2003. With more free movement of goods and services in the area, China’s neighbours were exposed to a much larger market which had a substantial effect on the reduction of production costs. This also resulted in greater flow of foreign investment to China. China had attracted Foreign Direct Investment (FDI) to the tune of US $ 44 billion in 2001 and the corresponding figure for 2002 rose to $52.7 billion.
As a measure of its sheer growth in the global economic Diaspora, the contribution of China as a part of the global economy has increased from 11% in 2000 to over13% in 2004 which in turn, dwarfs the share of the economies of Japan, France and the UK.The share of the country in world trade has grown even more rapidly. China’s share of world exports was at around 6% in 2003 from the level of 4% in 2000 with the corresponding figure for imports rising from 3.6% to 5.7% between 2000 and 2003.
The Chinese economy is currently facing one peculiar problem in the decline of its employable workforce in the recent years. With the government able to keep its population growth at 0.6% successfully adopting the 'One Child Plan', the government fears that old age pensions and other benefits will put a severe strain on the country’s growing national output. One of the other emerging problems for the Chinese economy is its continuing reliance towards a largely fixed exchange rate system. This certainly makes counter-inflationary monetary policies less flexible. So this issue with the possible restructuring and reform of the banking system could make the Chinese economy even stronger.
But growth with inequality and questions whether the Chinese economy will be able to sustain this rapid growth seem to be unceasing. With the booming development of the coastal cities coexisting with the hard, poor life still prevalent in the rural areas, the trickle down effect of globalization has been negligible. Between 1988 and 1995, China experienced the highest ever growths in income inequality ever monitored by the World Bank. Per capita urban incomes were 2.2 times higher than in rural households in 1990 which increased to 2.6 in 1999 and further to 2.8 in 2000. This has mainly been ascribed to rural unemployed not being able to find jobs owing to their lack of technical skills and education. With illiteracy falling in the second half of the 1990’s, the growth of 'human capital' is set to increase.
In the event of a general slowdown of the US economy with a sluggish growth in the Asian powerhouse Japan too, it remains to be seen whether the Chinese economic boom will burst like a bubble in the long run. With the Chinese Stocks facing bullish growth in the event of relative socio-economic stability in the Chinese economy, China is sure to become the investor’s choice in the next decade.
China grew at a rapid pace as a result of these reforms and opened its economy to the world for trade and direct foreign investment.
China has adopted a slow but steady method in implementing economic reforms. It has also sold the equity of some of its major Chinese state banks to overseas companies and bond markets. In recent years, China's role in international trade has also increased.
China, the fourth largest country in terms of size after Russia, Canada and the USA is now the world’s second largesteconomy after the USA if adjusted for differences in cost of living (purchasing power parity differences) although it is only about 10% of the US economy in dollar terms. Tremendous comparative advantage in terms of cheap labour and low production costs has given Chinese goods an edge over others in the world markets.
Data for the past three years reveal that the country has been maintaining a high growth rate in the GDPof around 8% to 10% annually. The upward trend in the country’s GDP, GNI as well as the per capita GDP reaching a high of around $1700 in 2005 has been continually maintained throughout the year 2006.
Increase in merchandise trade showed the tremendous growth in the country’s exports in the recent years. China has also been successful in stabilizing inflation rates after it reached a high of around 7% in 2004. The rise in Chinese worker’s remittances from abroad gas also contributed to a growth in the country’s GNI.
One of the defining features for the Chinese economy came on the 11th of December, 2001 when it became a member of the World Trade Organization or WTO. The Chinese accession to the WTO meant that Chinese economy opened up more to the rest of the world and its trade with Japan and the ASEAN nations (Association of South-East Asian Nations) increased rapidly. China drastically reduced its tariff rates from 16.7% in 2001 to 12% in 2002 and significant steps for reducing the number of items on its import license or quota which was 300 in 2002 are presently underway. Notably, India’s exports to China quadrupled from less than 1% in 1995 to more 4.5% in 2003. With more free movement of goods and services in the area, China’s neighbours were exposed to a much larger market which had a substantial effect on the reduction of production costs. This also resulted in greater flow of foreign investment to China. China had attracted Foreign Direct Investment (FDI) to the tune of US $ 44 billion in 2001 and the corresponding figure for 2002 rose to $52.7 billion.
As a measure of its sheer growth in the global economic Diaspora, the contribution of China as a part of the global economy has increased from 11% in 2000 to over13% in 2004 which in turn, dwarfs the share of the economies of Japan, France and the UK.The share of the country in world trade has grown even more rapidly. China’s share of world exports was at around 6% in 2003 from the level of 4% in 2000 with the corresponding figure for imports rising from 3.6% to 5.7% between 2000 and 2003.
The Chinese economy is currently facing one peculiar problem in the decline of its employable workforce in the recent years. With the government able to keep its population growth at 0.6% successfully adopting the 'One Child Plan', the government fears that old age pensions and other benefits will put a severe strain on the country’s growing national output. One of the other emerging problems for the Chinese economy is its continuing reliance towards a largely fixed exchange rate system. This certainly makes counter-inflationary monetary policies less flexible. So this issue with the possible restructuring and reform of the banking system could make the Chinese economy even stronger.
But growth with inequality and questions whether the Chinese economy will be able to sustain this rapid growth seem to be unceasing. With the booming development of the coastal cities coexisting with the hard, poor life still prevalent in the rural areas, the trickle down effect of globalization has been negligible. Between 1988 and 1995, China experienced the highest ever growths in income inequality ever monitored by the World Bank. Per capita urban incomes were 2.2 times higher than in rural households in 1990 which increased to 2.6 in 1999 and further to 2.8 in 2000. This has mainly been ascribed to rural unemployed not being able to find jobs owing to their lack of technical skills and education. With illiteracy falling in the second half of the 1990’s, the growth of 'human capital' is set to increase.
In the event of a general slowdown of the US economy with a sluggish growth in the Asian powerhouse Japan too, it remains to be seen whether the Chinese economic boom will burst like a bubble in the long run. With the Chinese Stocks facing bullish growth in the event of relative socio-economic stability in the Chinese economy, China is sure to become the investor’s choice in the next decade.
The Chinese Economy
Market liberalization in the Chinese economy has brought its economy forward by leaps and bounds - but rural China remains poor, even as its cities increase in affluence.
In 2010, China’s GDP growth was 10.456 percent, totaling US$ 5,745.13 billion, and is expected to increase 11.79 percent in 2011 to US$ 6,422.28 Billion. Forecasts for 2015 predict China’s GDP to reach US$ 9,982.08 billion, growing 10-12 percent per year between 2010 and 2015
China's economy is huge and expanding rapidly. In the last 30 years, the rate of Chinese economic growth has been almost miraculous, averaging 8 percent growth in Gross Domestic Product (GDP) per annum. The economy has grown more than 10 times during that period, with ChineseGDP reaching 3.42 trillion US dollars in 2007. China already has the biggest economy after the United States and most analysts predict China will become the largest economy in the world this century.
China’s population in 2010 was 1.341 billion, and its expected to grow to 1.375 billion in 2015. In 2010, China’s unemployment rate stood at only 4.1 percent, decreasing 4.65 percent from the previous year and expected to decrease further to 4 percent in 2011. Forecasts for 2015 predict China’s unemployment rate to remain at 4 percent between 2011 to 2015.
However, there are still inequalities in the income of the Chinese people. The per capita income of China is only about 2,000 US dollars, which is fairly poor against global standards.
Economic reforms started in China in the 70s and 80s with the initial focus on collectivizing agricultural activities in the country. The leaders of the Chinese economy, at that point in time, were trying to change the center of agriculture from farming to household activities. The reforms also extended to the liberalization of prices, in a gradual manner. The process of fiscal decentralization soon followed.
As part of the reforms, more independence was granted to business enterprises that were owned by the state government. This meant government officials at local levels and managers of various plants had more authority than before.
This led to the creation of a number of various types of privately held enterprises within the services sector, as well as the light manufacturing sectors. The banking system was also diversified, and Chinese stockmarkets started to develop and grow as economic reforms in China took hold.
In 2010, China’s GDP growth was 10.456 percent, totaling US$ 5,745.13 billion, and is expected to increase 11.79 percent in 2011 to US$ 6,422.28 Billion. Forecasts for 2015 predict China’s GDP to reach US$ 9,982.08 billion, growing 10-12 percent per year between 2010 and 2015
China's economy is huge and expanding rapidly. In the last 30 years, the rate of Chinese economic growth has been almost miraculous, averaging 8 percent growth in Gross Domestic Product (GDP) per annum. The economy has grown more than 10 times during that period, with ChineseGDP reaching 3.42 trillion US dollars in 2007. China already has the biggest economy after the United States and most analysts predict China will become the largest economy in the world this century.
China’s population in 2010 was 1.341 billion, and its expected to grow to 1.375 billion in 2015. In 2010, China’s unemployment rate stood at only 4.1 percent, decreasing 4.65 percent from the previous year and expected to decrease further to 4 percent in 2011. Forecasts for 2015 predict China’s unemployment rate to remain at 4 percent between 2011 to 2015.
However, there are still inequalities in the income of the Chinese people. The per capita income of China is only about 2,000 US dollars, which is fairly poor against global standards.
Economic reforms started in China in the 70s and 80s with the initial focus on collectivizing agricultural activities in the country. The leaders of the Chinese economy, at that point in time, were trying to change the center of agriculture from farming to household activities. The reforms also extended to the liberalization of prices, in a gradual manner. The process of fiscal decentralization soon followed.
As part of the reforms, more independence was granted to business enterprises that were owned by the state government. This meant government officials at local levels and managers of various plants had more authority than before.
This led to the creation of a number of various types of privately held enterprises within the services sector, as well as the light manufacturing sectors. The banking system was also diversified, and Chinese stockmarkets started to develop and grow as economic reforms in China took hold.
Subscribe to:
Posts (Atom)