China's Long Road to a Low-Carbon Economy, Andrews-Speed (July 2012)
China's economy rises
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China’s Economy Rises
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A succession of dynasties ruled China from the second millennium BC to the early 1900s. Chinese history changed course, however, as Europeans expanded into Asia. China suffered through clashes with European powers in the 1800s. Then, in 1911, Chinese revolutionaries overthrew the last dynasty. The country suffered internal strife for nearly four decades due to warlords, civil war and Japanese invasion. In 1949, the Chinese Communist party won the civil war and established China's current government. The Communists implemented many social and political changes, starting in the 1950s with the transition to a planned economy. Leader Mao Zedong launched a "Cultural Revolution," in which young loyalists attacked intellectuals and party leaders. In the late 1970s, the Chinese government introduced economic reforms, introducing elements of a free-market economy. The government also encouraged foreign investment. That laid the groundwork for the modern China we see today.
Transcript of China's economy rises
China’s Economy Rises
Introduction to China’s Economy
HISTORY
A succession of dynasties ruled China from the second millennium BC to the early 1900s. Chinese history changed course, however, as Europeans expanded into Asia.
China suffered through clashes with European powers in the 1800s. Then, in 1911, Chinese revolutionaries overthrew the last dynasty. The country suffered internal strife for nearly four decades due to warlords, civil war and Japanese invasion. In 1949, the Chinese Communist party won the civil war and established China's current government.
The Communists implemented many social and political changes, starting in the 1950s with the transition to a planned economy. Leader Mao Zedong launched a "Cultural Revolution," in which young loyalists attacked intellectuals and party leaders.
In the late 1970s, the Chinese government introduced economic reforms, introducing elements of a free-market economy. The government also encouraged foreign investment. That laid the groundwork for the modern China we see today.
China’s Economic RiseChina’s Economic Rise
GDP – real growth rate:
9.8% (2008) country comparison to the world:13% (2007)11.6% (2006)
GDP-Per capita (PPP-Purchasing power parity):
$6,000 (2008)country comparison to the world:$5,500 (2007)$4,900 (2006)note: data are in 2008 US dollars
GDP – composition by sector:
agriculture: 10.6%industry: 49.2%services: 40.2% (2008)
China – Economic Fact SheetChina – Economic Fact Sheet
International Comparison: Real GDP Growth
China’s Economic RiseChina’s Economic Rise
DEVELOPMENT IN AGRIGULTURE
Agriculture is vital industry employing over 300 million farmers.
China ranks first worldwide in farm outputs primarily producing-
Rice Wheat Potatoes Sorghum Peanuts Tea Millet Barley Cotton Oilseed Pork Fish
DEVELOPMENT IN AGRICULTURE
Leading producer of cotton. China accounts for about one-third of the total fish
production of the world. China is both the world's largest producer and
consumer of agricultural products Yields are high because of intensive cultivation, China is the world's leading producer of pigs,
chickens, and eggs, and it also has sizable herds of sheep and cattle.
China has a long tradition of ocean and freshwater fishing and of aquaculture
. Pond raising has always been important and has been increasingly emphasized to supplement coastal and inland fisheries threatened by overfishing and to provide such valuable export commodities as prawns.
Production of wheat from 1961 to 2004
SERVICE SECTOR
In 2010 the services sector produced 43% of China's annual GDP .
The official non manufacturing index, based on a survey of about 1,200 companies in 27 industries including telecommunications, transportation, and construction, slipped to 55.6 from 56.7 in July
Tourism industry contributes more than 70% of total tourism revenue
MAJOR INDUSTRIES OF CHINA
Electronic information Biotechnology Automobile Modern medicine New materials Environmental energy Marketing Steel industry Fertilizers and Cement
EXTERNAL TRADE
CHINA’S INVESTMENT ENVIRONMENT
Foreign Economic policies Attracting Foreign Investment Financial Institutions Foreign Exchange Control Security Markets Insurance Market
TECHNOLOGY
China’s technology and IT sector expanded in first 8 months
But companies faced higher costs and slower income
Output of manufacturers in the sector rose to15.5% and sales value increased 22.3%
In july the sectors revenue grew 18.3%
Does China Follow the East Asian Model?
Of course, there is nothing surprising about China’s economic model: We have seen it before in Japan, South Korea, and Taiwan
Yet, while the other East Asian economies have been gradually dismantling their developmental state apparatuses, China seems to be in the process of solidifying the elements of its developmental state
Enter the Dragon?China’s Economic RiseEnter the Dragon?China’s Economic Rise
Does China Follow the East Asian Model?
Of course, there is nothing surprising about China’s economic model: We have seen it before in Japan, South Korea, and Taiwan
Yet, while the other East Asian economies have been gradually dismantling their developmental state apparatuses, China seems to be in the process of solidifying the elements of its developmental state
Enter the Dragon?China’s Economic RiseEnter the Dragon?China’s Economic Rise
Elements of the East Asian Model in ChinaThe Chinese state has purposefully created a dual economic structure: one part is based on an ever-expanding private sector, while the other part is based on still prominent state-owned enterprises, or SOEs
The private sector is relatively free of state control, but still depends on state policies
The state sector, while declining in overall influence, still plays “a major part in heavy industry and makes up a high percentage of gross domestic fixed capital formation, gross output value and the number of employees”
Enter the Dragon?China’s Economic RiseEnter the Dragon?China’s Economic Rise
Elements of the East Asian Model in ChinaConclusion
China is clearly not following the Anglo-Saxon “model” of full economic liberalization; indeed, the evidence strongly indicates that China is another developmental state
The timing of China’s capitalist development, however, is very different from that of the other East Asian “miracles”: This very likely means that China’s developmental trajectory will differ, perhaps in dramatic ways
Enter the Dragon?China’s Economic RiseEnter the Dragon?China’s Economic Rise
Comparing India and China’s Growth StoriesComparing India and China’s Growth Stories
Indicators India China
Political System Multi-party Democracy
One-party authoritarian rule
Speed of Growth Economic reforms started in 1991. Average 6% growth rate in past two decades.
Economic reforms started in 1978. Average 9.5% growth rate in past two decades.
Areas of Specialization
Rising power in software, design, services, and precision industry.
Dominant in mass manufacturing, electronics and heavy industrial plants
Comparing India and China’s Growth StoriesComparing India and China’s Growth Stories
Indicators India China
Gini index (standard measure of inequality)
36.8
47.0 (up 10 points from 15 yrs ago)
Foreign Direct Investment
6.8% (up from 0.3% in 2004)
17.8%
Future Areas of growth
R&D, bio-technology, high-value IT enabled services (legal, medical, engineering architecture), manufacturing, agro-based industry
IT business, services and continued manufacturing
“GDP Growth 2000 to 2050”“GDP Growth 2000 to 2050”
Source: Goldmann Sachs: The Path to 2050
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GermanyBrazil
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CHINA’S FUTURE
CHINA V/S US
TOPICS INCLUDED
GDP TECHNOLOGY EXPORTS POPULATION TRADE DEFECIT ATOMIC AND NUCLEAR ENERGY
