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.
Sunday, September 25, 2011
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.
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