Features Questions? Contact us Already a Member? It allows API clients to download millions of rows of historical data, to query our real-time economic calendar, subscribe to updates and receive quotes for currencies, commodities, stocks and bonds. Click here to contact us. Please Paste this Code in your Website. News Stream. A slowdown in factory activity, higher raw material costs, and new COVID outbreaks in some regions all weighed on the recovery momentum.
During the first half of the year, the economy grew by Still, upbeat retail sales for June suggest consumer spending in China remains resilient. This was the strongest pace of expansion since the series began in , boosted by strengthening domestic and global demand, strict virus containment measures, and continued fiscal and monetary support.
The latest reading reflected a low comparison base in when activity plunged due to the COVID shocks. Rapid population growth in China, despite the One Child Policy, has resulted in very large numbers in the economically active population, leading to rapid urbanisation. This has fuelled further industrialisation, allowing for further population growth. As geographers, we should categorise these factors Social, Economic, Environmental, Political , rank them, draw links between them and consider the players and stakeholders involved.
We will then have a detailed understanding of the factors which have enabled China to pursue an accelerated path to economic development.
Company Reg no: VAT reg no Main menu. Subjects Shop Courses Live Jobs board. View shopping cart. View mytutor2u. Account Shopping cart Logout. Explore Geography Geography Search. Explore Blog Reference library Collections Shop. Share: Facebook Twitter Email Print page. Labour supply There is a plentiful supply of workers in China with a steady stream of rural-urban migrants in search of work.
Political system The non-democratic and authoritarian political regime in China has meant that it has been possible to embrace western-style free market economics while maintaining control over the political system.
Beginning in , China launched several economic reforms. The central government initiated price and ownership incentives for farmers, which enabled them to sell a portion of their crops on the free market. In addition, the government established four special economic zones along the coast for the purpose of attracting foreign investment, boosting exports, and importing high technology products into China.
Additional reforms, which followed in stages, sought to decentralize economic policymaking in several sectors, especially trade. Economic control of various enterprises was given to provincial and local governments, which were generally allowed to operate and compete on free market principles, rather than under the direction and guidance of state planning.
In addition, citizens were encouraged to start their own businesses. Additional coastal regions and cities were designated as open cities and development zones, which allowed them to experiment with free-market reforms and to offer tax and trade incentives to attract foreign investment. In addition, state price controls on a wide range of products were gradually eliminated. Trade liberalization was also a major key to China's economic success. Removing trade barriers encouraged greater competition and attracted FDI inflows.
China's gradual implementation of economic reforms sought to identify which policies produced favorable economic outcomes and which did not so that they could be implemented in other parts of the country, a process Deng Xiaoping reportedly referred to as "crossing the river by touching the stones. Since the introduction of economic reforms, China's economy has grown substantially faster than during the pre-reform period, and, for the most part, has avoided major economic disruptions.
This has meant that on average China has been able to double the size of its economy in real terms every eight years. The global economic slowdown, which began in , had a significant impact on the Chinese economy. China's media reported in early that 20 million migrant workers had returned home after losing their jobs because of the financial crisis and that real GDP growth in the fourth quarter of had fallen to 6. From to , China's real GDP growth averaged 9. However, the rate of GDP growth declined slowed for the next six consecutive years, falling from Real GDP ticked up to 6.
Figure 3. Figure 4. Economists generally attribute much of China's rapid economic growth to two main factors: large-scale capital investment financed by large domestic savings and foreign investment and rapid productivity growth. These two factors appear to have gone together hand in hand. Economic reforms led to higher efficiency in the economy, which boosted output and increased resources for additional investment in the economy.
China has historically maintained a high rate of savings. However, most Chinese savings during this period were generated by the profits of SOEs, which were used by the central government for domestic investment. Economic reforms, which included the decentralization of economic production, led to substantial growth in Chinese household savings as well as corporate savings. As a result, China's gross savings as a percentage of GDP is the highest among major economies. The large level of domestic savings has enabled China to support a high level of investment.
In fact, China's gross domestic savings levels far exceed its domestic investment levels, which have made China a large net global lender. Several economists have concluded that productivity gains i. The improvements to productivity were caused largely by a reallocation of resources to more productive uses, especially in sectors that were formerly heavily controlled by the central government, such as agriculture, trade, and services.
For example, agricultural reforms boosted production, freeing workers to pursue employment in the more productive manufacturing sector. China's decentralization of the economy led to the rise of non-state enterprises such as private firms , which tended to pursue more productive activities than the centrally controlled SOEs and were more market-oriented and more efficient.
Additionally, a greater share of the economy mainly the export sector was exposed to competitive forces. Local and provincial governments were allowed to establish and operate various enterprises without interference from the government. In addition, FDI in China brought with it new technology and processes that boosted efficiency. However, as China's technological development begins to converge with major developed countries i.
Several developing economies notably several in Asia and Latin America experienced rapid economic development and growth during the s and s by implementing some of the same policies that China has utilized to date to develop its economy, such as measures to boost exports and to promote and protect certain industries. However, at some point in their development, some of these countries began to experience economic stagnation or much slower growth compared to previous levels over a sustained time, a phenomenon described by economists as the "middle-income trap.
The World Bank classifies development levels of economies using a per capita gross national income GNI methodology. The Chinese government projects that China can cross the high-income threshold by It hopes to achieve this largely by making innovation a major source of future economic growth. Skeptics contend that innovation growth in China will be hard to achieve, especially if it is mainly state-driven and imposes new restrictions on foreign firms,. Figure 5. Notes: Bar in red indicates the level China would need to reach to become a high-income economy.
For some years thereafter, EIU projects U. GDP growth to be greater than China's Figure 6. Figure 6. The Chinese government has indicated its desire to move away from its current economic model of fast growth at any cost to more "smart" economic growth, which seeks to reduce reliance on energy-intensive and high-polluting industries and rely more on high technology, green energy, and services. China also has indicated it wants to obtain more balanced economic growth. These issues are discussed in more detail later in the report.
The rapid growth of the Chinese economy has led many analysts to speculate if and when China will overtake the United States as the "world's largest economic power. Measured in U. Many economists contend that using nominal exchange rates to convert Chinese data or those of other countries into U.
To illustrate, one U. This is because prices for goods and services in China are generally lower than they are in the United States. Conversely, prices for goods and services in Japan are generally higher than they are in the United States and China.
Thus, one dollar exchanged for local Japanese currency would buy fewer goods and services there than it would in the United States.
Economists attempt to develop estimates of exchange rates based on their actual purchasing power relative to the dollar in order to make more accurate comparisons of economic data across countries, usually referred to as purchasing power parity PPP. According to the IMF which uses price surveys conducted by the World Bank , prices for goods and services in China are about half the level they are in the United States.
China's economic ascendency as the world largest economy has been impressive, especially considering that in , China's GDP on a PPP basis was only one-tenth that of the United States see. Figure 7. Table 1. Comparisons of Chinese, Japanese, and U. Dollars and a Purchasing Power Parity Basis: According to a study by economist Angus Maddison, China was the world's largest economy in , accounting for an estimated However, foreign and civil wars, internal strife, weak and ineffective governments, natural disasters some of which were man-made , and distortive economic policies caused China's share of global GDP on a PPP basis to shrink significantly.
By , China's share of global GDP had fallen to 5. The adoption of economic reforms by China in the late s led to a surge in China's economic growth and helped restore China as a major global economic power. Even with continued rapid economic growth, it would likely take many years for Chinese living standards to approach U. China has emerged as the world's largest manufacturer according to the World Bank.
Figure 8 lists estimates of the gross value added of manufacturing in China, the United States, and Japan expressed in U. Gross value added data reflect the actual value of manufacturing that occurred in the country i. In , the value of China's manufacturing on a gross value added basis was Manufacturing plays a considerably more important role in the Chinese economy than it does for the United States.
In , China's gross valued added manufacturing was equal to Figure 8. In its Global Manufacturing Competitiveness Index, Deloitte an international consulting firm ranked China as the world's most competitive manufacturer out of 40 countries , based on a survey of global manufacturing executives, while the United States ranked second it ranked fourth in The index found that global executives predicted that the United States would overtake China by to become the world's most competitive economy, largely because of its heavy investment in talent and technology e.
As a result, China was projected to fall to the second-most competitive manufacturer by More broadly, the World Economic Forum WEF produces an annual report that assesses and ranks based on an index the global competitiveness of a country's entire economy, based on factors that determine the level of productivity of an economy, which in turn sets the level of prosperity that the country can achieve.
The decline in China's working age population may have contributed rising wages in China. As indicated in Figure 9 , China's average monthly wages converted into U. S levels. In , China's unit labor production costs were Figure 9. Notes: Because data are listed in U. However, such data may reflect average labor costs in dollars that U.
Figure Notes: The labor cost of producing one unit of output, indexed to U. China's trade and investment reforms and incentives led to a surge in FDI beginning in the early s. Such flows have been a major source of China's productivity gains and rapid economic and trade growth. There were reportedly , foreign-invested enterprises FIEs registered in China in , employing That level rose from 2. At their peak, FIEs accounted for The sharp increase in China's global FDI outflows in recent years appears to be largely driven by a number of factors, including Chinese government policies and initiatives to encourage firms to "go global.
Table 2. A key aspect of China's economic modernization and growth strategy during the s and s was to attract FDI into China to help boost the development of domestic firms. Revenue from the Passenger Rail Transport industry in China is expected to decrease at an annualized 7. Industry passenger turnover is expected to decrease by Until the mids, railway transportation was considered China's most important form of transportation.
Under China's economic reforms, road and air transportation experienced tremendous growth, while the railway system grew at a slower rate.
In terms of passenger numbers, railway transportation as a share of the total transportation system has decreased over the past decade. Railway passenger turnover in In , sales revenue of industry increased slowly compared with previous years which was mainly due to the outbreak of COVID in China. Over the past five years, industry revenue has grown at an annualized In recent years, lifestyle changes, an increasing emphasis on personal happiness and the development of a range of drinking establishments have contributed to rapid industry growth.
In addition, increasing urbanization in China and higher incomes have boosted demand for industry services Revenue for the Department Stores and Shopping Mall industry in China is expected to grow at an annualized 1. Per capita disposable income and consumer spending power have grown over the past five years. Industry revenue is expected to decrease by Industry establishment numbers have risen by 3.
However, industry enterprise numbers are expected to fall by 1. This decline is due to increased merger activity and Rising tourist activity over the four years through has supported the industry's performance. Revenue for the Hotels industry in China is expected to decrease at an annualized 0. However, this trend includes an expected decline of The outbreak of COVID at the end of in China caused many hotels to close operations in the first half of , strongly affecting industry revenue in
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