The Chinese Economy and Hte Effects It Will Have on the Canadian Economy
Essay title: The Chinese Economy and Hte Effects It Will Have on the Canadian Economy
The Expansion of the Chinese Economy
And the Effects it has on the Canadian Economy
What was once considered a third world country, in a state of economic despair; China has grown to become a strong economic power and continues to expand. For the past 25 years, China has grown economically at the average rate of 9.0% per year (People’s Republic of China). Unexpected at first, China has entered international markets at full steam, taking the world by surprise. Their rate of expansion alone has set records in all areas of economy. The purpose of this essay is to expose the economic growth of China and the factors that contributed to this. I will also examine the effects China has on the main economic sectors of Canada. A brief look at China’s economic history will show the path of China’s development and how China will continue to grow and become an even stronger nation within the international trade market.
China’s economic history is a perfect example of a confused government trying to find the right direction. From the 1950’s, with the introduction of a centrally planned economy, to the 5 year plans introduced in 1953 to model after Stalin and the Soviet Union, China seemed eager to take economic direction from any source(China). When plans like the Great Leap Forward failed, the government decided to take the initiative to control the economic situation (China). With the Socialist Market Reform, the Chinese government tried to lessen the control of the government, as to allow a market economy to generate, while still having the state owned sectors as the backbones (China). They hoped this would encourage foreign investment and internal growth. These decisions were beneficial to the Chinese economy and China saw an average 10.2% economic growth per year during the 1980’s (China). This is recorded as the highest economic growth rate in the world (China). Between 1990 and 2003, China’s economy grew at the average rate of 9.6% per year and continues to maintain this rate (China). Despite the swift development in the economy, China experienced income gap widening, increases in unemployment and inflation from the rapid unbalanced expansion (China). Regardless of high gross domestic product (GDP), China was still considered a low-income developing nation because they had to support over 1.3 billion people (Economy of People’s Republic of China). The Chinese government made progress throughout the years, but is aware there is a lot of work still left to accomplish.
With China’s hard work to create change within their economy, their gross domestic product grew to $1,417 billion in 2003 (China). Despite the high gross domestic product, their gross domestic product per capita was only $1,100, because of China’s large population (China). Their high gross domestic product gives them the power in the international trade market to continue to expand, but without work on increasing their gross domestic product per capita, China will still be considered a developing third world nation.
Every economy needs a workforce to drive it and to carry it forward. China has the largest workforce in the world, with 773 million people recorded in 2003, approximately 20% of the worlds working population (China). Since the state previously assigned jobs, China’s government now gives workers the choice of where they want to work and firms the choice of whom they would like to higher (China). With the increase in job mobility, China has also seen an increase in job insecurity. In 2002 China’s unemployment rate was recorded as 4%, but the real problem was the job insecurity and underemployment (China). The government of China, in their effort to make China superior and better to live in for its population, has been working on retirement, social security and medical care systems (China). They take example from leading nations, such as: United States of America, United Kingdom and Canada. China’s working population was driven into the ground during the centrally planned economy, but now has been given the opportunity to grow and develop, as they desire.
Some countries are dependent
upon their agricultural industry to no only feed them, but also be a trade resource. China contains 7% of the world’s fertile land, to support 20% of the world’s population (China). China’s government recognized the lack of fertile land and has initiated many projects to increase the production in their agricultural market. Their irrigation endeavor has made it so that 50% of China’s agricultural land is now irrigated (China). During productive years, China can now generate enough grain to support the country’s population’s basic diet. Of course in low production years, China still relies upon imports to provide