Economic rise of china and its consequences

Economic Rise of China and its Consequences

Banjo Niyi

China : some information (2013)

Complete name : People's Republic of China Population : 1,368 billion inhabitants Area : 9.561.000 km² Head of state : Xi Jinping

但什么经济  ?!*

* But what about economy ?

I) The China rise : History and current

situation

Historical review

Centrally planned economy, Mao Zedong (1949-1979)

Beginning of socialist market economy, Deng Xiaoping (end of the 1970's)

WTO in 2001, a symbol 2008 : less affected 2010 : 2nd economic powerhouse

Before 1979

Collectivist agriculture Limits put on companies Economical failure

After 1979

First stage De-collectivisation of agricultrue Trade&Foreign Inv Less barriers on entrepreneurshipSecond stage Privatisation Lifting of price control Protectionist policies

AgricultureIndustrial sectors Trade & Foreign InvInfrastructureGovernment finances

Key ideas

Increasing wheat production

China : a socialist market economy

Economical liberalism & authoritarian political system

Different kind of companies : state owned ; state holding ; private ;urban collectives

Chinese economical situation

Unemployment rate (2013) : 4,1% (IMF)

GDP (2013) $9181 billions (IMF)

Growth : 7,7% (IMF)

Chinese economical situation

Trade & Partners

Balance of trade : $182 billions (2013, IMF)

A weak currency

1€ = 6,62 renminbi 1$ = 6,25 renminbi. Advantage in trade : exports are

supported Currency impossible to convert

II) Consequences

Incomplete transition to market economy

Over dependance on export and fixed investment

Banking systemGrowing pollutionCorruption

Challenges for China

Huge Chinese demand of raw materials

Increasing prices ?

Consequences on global demand

Consequences on global growth

China is supposed to help global growth

But new orientated economy (2011) Another theory..

Consequences on global supply

Cheap and large work force & weak currency

Higher competition But closed domestic market (technology

transfer)

Consequences on currency & debts

Biggest amount of greenhouse gases in the world

In the Kyoto Protocol but... Agreement with the USA (end

of 2014)

Consequences on the environment

Consequences on global politics

A new world ? A new system that is working ?

Thank you for your attention !