...BMGT 110 China’s Global Economy Anthony Fleury Xinhua reported that Beijing recorded 80% blue sky days in the first quarter of 2009. The concept that there is a blue sky day is unusual for most of the world, but it represents the price that China has paid for its rapid economic growth trajectory. As cities sprout from villages and a labor force in the hundreds of millions is mobilized, China has experienced a double-digit GDP growth for much of the past thirty years. This growth however is under threat from several sources. The environmental consequences of growth are just one threat. China also faces chronic resource shortages – its industry does not want for coal but the Chinese people do struggle for things such as shortages of oil, food and clean water. The PRC also faces political tests as well, including Taiwan, Tibet and Xinjiang. Political tensions with the former could destabilize all of Asia if not the world. The tensions in the western part of China represent the social unrest that the Communist government’s march towards wealth has created. Even amongst Han, there is considerable disparity of wealth between regions and classes, and these disparities may very well threaten China’s future. This paper will analyze each of these critical issues in turn, and then synthesize the issues into an assessment for the future of China’s economic growth. All economies depend on resources for their growth. Output is determined by the availability of labor,...
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...The World's Greatest Coal Arbitrage: China's Coal Import Behavior and Implications for the Global Coal Market Summary China is home to the world’s second largest proven coal reserves after the United States. In addition, prior to 2009, China was a net coal exporter. Coal is a cornerstone of the Chinese economy, representing 77 percent of China’s primary energy production and fueling almost 80 percent of its electricity. Moreover, China is the world’s top coal consumer, accounting for nearly half of global consumption in 2010. Over the past decade, China’s domestic coal output has more than doubled while its coal imports have increased by a factor of 60—the country’s dependence on other nations’ coal exports is growing. In 2009, the global coal market witnessed a dramatic realignment as China burst onto the scene, importing coal from as far away as Colombia and the United States. With 182 million tons (Mt) of coal sourced from overseas suppliers in 2011, China has overtaken Japan as the world’s top coal importer. Moreover, as the world’s top coal consumer, China’s imports could rise significantly again by 2015. China’s recent move from being a net coal exporter to a net coal importer portends significant changes on the global stage, especially in terms of climate change. Understanding China’s rising coal imports is crucial for managing their global impact. Introduction In 2009 the global coal market witnessed one of the most dramatic realignments it has ever seen– China...
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...future as the Chinese dragon stirs and shifts. China’s rise has been perhaps the most significant economic event in two centuries, occurring 100 times more quickly and on a scale 1000 times larger than Britain’s Industrial Revolution. Since 2000, Australia has been an essential part of this transformation, providing the raw materials to feed China’s frantic manufacture of steel vertebrae for everything from cars and trucks to railways, apartments and office towers. China’s appetite for resources has made us richer than ever before, but it has also drained the competitiveness from many parts of our economy, leaving us vulnerable. In Dragon’s Tail, Andrew Charlton shows that China’s growth model is now reaching its limit, and the world’s most populous economy faces a challenging transition. Whether China crashes, or crashes through, this will have dramatic implications for Australia, slowing the demand for our resources and forcing us to reassess the foundations of our wealth. Charlton looks at ways to revitalise the Australian economy and secure our prosperity in a changing world. “Understanding China’s growth model helps explain why australia has done so well in the twenty-first century. But it also explains why, at the same time, our economic anxiety is reaching a zenith: why holden is leaving, why the budget is in such an apparent quagmire, why house prices are soaring, why the dollar is so volatile. China’s growth has brought us a windfall, but it is a precarious sort...
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...WRT 110 10 May 2014 China Open Up Birth Control Policy Recently years, China’s government has recognized some disadvantages that the One-child Policy resulted, so the government decided to implement a new policy. The one-child Birth Control Policy was established to limit communist China’s population growth. There are both some advantages and disadvantages between China’s old birth control policy and China’s new birth control policy. But generally, it is obvious that the new China birth control policy is adjusted more to modern society than the old China’s birth control policy. The old policy caused some social problems. It restricted economic development. And the new policy could solve some social problems which the One-child Birth Control Policy caused. The One-child Birth Control Policy caused some social problems like sex ratio imbalance and abortion. Both the new policy and the old policy have great effects on population. The One-child Birth Control Policy stipulates people that one parent can only have one child. After the Second World War, China had a population explosion which caused social problems such like food shortage and famine. To resolve this situation, China’s government decided to establish a policy to limit the population growth which is China’s birth control policy. China successfully controlled its population growth after they stipulate that policy. In 2013, the China’s government decided to implement a new birth control policy. This policy allowed...
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...China's one child policy was established by Chinese leader Deng Xiaoping in 1979 to limit communist China's population growth. Although designated a "temporary measure," it continues a quarter-century after its establishment. The policy limits couples to one child. Fines, pressures to abort a pregnancy, and even forced sterilization accompanied second or subsequent pregnancies. It is not an all-encompassing rule because it has always been restricted to ethnic Han Chinese living in urban areas. Citizens living in rural areas and minorities living in China are not subject to the law. However, the rule has been estimated to have reduced population growth in the country of 1.3 billion by as much as 300 million people over its first twenty years. This rule has caused a disdain for female infants; abortion, neglect, abandonment, and even infanticide have been known to occur to female infants. The result of such Draconian family planning has resulted in the disparate ratio of 114 males for every 100 females among babies from birth through children four years of age. Normally, 105 males are naturally born for every 100 females. Recent Effects of the One Child Law Now that millions of siblings-less people in China are now young adults in or nearing their child-bearing years, a special provision allows millions of couples to have two children legally. If a couple is composed of two people without siblings, then they may have two children of their own, thus preventing too dramatic of...
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...Discuss the impact of globalisation on economic development, with reference to an economy other than Australia. Globalisation refers to the integration between different countries and economies and the increased impact of international influences on all aspects of life and economic activity. China's economy has become substantially globalised since their economic reform in the late 1970s, and has thus experienced exponential economic growth and some economic development, which has aided their transformation from a developing to emerging economy. Evidence of globalisation in China can be seen in their international and trade-based financial flows, their ever-improving state of technology and communication and their increased level of alignment...
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...all is not perfect. While governments and business pour mass amounts of investments into the countries there are huge obstacles to continued growth. There are social, political, and environmental challenges. Important is keeping growth at a steady pace that will eliminate the unemployment lines. Pollution and environmental challenges, political backlash, debt and currency crises, inadequate medical care, threats of epidemics, and war are continuing challenges. The next few years will see a dramatic acceleration in the shift of global economic power eastwards, according to the latest predictions from The Conference Board, an international network of leading business figures. It believes that the sluggish growth in the established economies of North America, Europe and Japan will result in their share of global GDP shrinking from around half today to a third by 2016. In line with other international bodies, such as the IMF and the OECD, the Conference board sees global growth returning next year, after the worst downturn in three-quarters of a century. The Board says that the world economy will expand by 3.5 per cent in 2010, and growth will accelerate to more than 4 per cent in 2011. The current IMF forecast is for worldwide growth of 3.1 per cent next year, and during 2010-14, an average just above 4 per cent. "Global growth will resume in 2010, with global output per head returning to pre-crisis levels," said Bart van Ark, chief...
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...three main factors that influence economic growth——capital investment, labor and total factor productivity (TFP). Although China has gradually liberalized the one-child policy, but in the short term, China's population growth rate will not increase greatly, while with the increase of China's population aging trend, China's labor population ratio will continue to decline. Therefore, China‘s long-term growth of the economy cannot rely on the increase of labor force. On the other hand, China's investment ratio (the proportion of total investment GDP) has ranked high in the world. The rapid growth of local government debt in China has become one of the factors which restrict economic development. Therefore relying on the increase of capital investment cannot promote the healthy development of economy. In this context, improving the production efficiency which is measured by TFP is particularly important. There are numerous researches about TFP of China, while researches on TFP of a certain city are relatively few. Therefore, I choose to study TFP of Beijing which as capital of China is representative. 2.Definition and Model To study the TFP and economy development in Beijing, I mainly use Solow residual method and Cobb-Douglas production function. 2.1 Solow residual method Robert Solow defined rising productivity as rising output with constant capital and labor input. It is a "residual" because it is the part of growth that cannot be explained through capital accumulation...
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...done today. Two countries that use these practices often are China and India. They trade manufactured and labor intensive goods. This gives them an edge on the other countries they compete with in the global market. This paper first reviews some key features of China’s and India’s trade, in particular, the recent rapid export growth; the changing relative importance of goods and services; and the changing composition of exports within merchandise and services. With this as background, we use a global economy-wide modeling approach to take into account all of the potential impacts of a number of policy reforms and likely scenarios. First, the implications of the reforms under way in India are examined to see if they might result in greater competition between China and India. Then, we generate a baseline and examine the potential global implications of higher-than-expected growth rates in these two economies. We consider first the impact of more rapid economy-wide growth in China and India. We then examine the implications of two different types of growth, first growth focused on relatively sophisticated products, and subsequently growth driven by increased accumulation of physical and human capital. China’s and India’s trading patterns. Although it turns out that both have been quite successful in expanding their exports and imports, they have done this in very different ways. Broadly, China has relied primarily on exports of manufactures, frequently as part of an East...
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...Discuss each single one of the main risk factors that should be allowed for (in addition to WACC) in order to determine the appropriate required return on this capital investment opportunity. In 2011, China surprisingly has taken over the United States’ position as the world’s largest producer of manufactured goods. Ross (2013) noted that, China’s industrial output had risen to 120% of the US level where in 2007, China’s total industrial production was only 62% of the US level. The huge manufacturing engine boosted the living standards by doubling the country’s GDP per capita over the last decade. However, manufacturing growth is slowing more quickly than aggregate economic growth. Data from the government shows China's economic growth has weakened in recent years, hitting 7.7 percent in 2013, the lowest level since 1999 (New Straits Times, 2014). Growing concern on China’s manufacturing competitiveness has recently made this country losing some new factory investments to lower-cost locations, such as Vietnam. There are three risk factors that should be addresses in order to determine the appropriate required return on this capital investment opportunity: 1) Risk of rising labor cost According to Orlik (2014), as cited from The Wall Street Journal, Chinese private-sector wages rose 14% in 2012, and are set to increase by 10 percent or more in 2014 (Bloomberg News, 2014). This condition is driving more low-cost manufacturers out of the country and boosting consumption...
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...(1,313,973,713 as of mid-2006); China is the world's largest and most populous country. As the world's population is approximately 6.5 billion, China represents a full 20% of the world's population so one in every five people on the planet is a resident of China. The population density in China is 130 people per sq km. However, China’s Population wasn’t Always like this. After the proclamation of the People's Republic of China in 1949, China was ruled by the Eight Immortals, which included Mao Zedong. Mao Believed that of all things people was most precious. The Population growth caused Famine In that killed millions of people by 1962. The One Child law wasn’t implemented until Three years after Mao Death in 1979. In China the One child Policy restricts families to one child each. The government has officials and government positions specifically to keep this policy in effect. It was originally suppose to be temporary but it is still last 25 years later. Mao Zedong was a Chinese Marxist theorist, soldier, and statesman who led China's communist revolution following decades of civil war.Before Mao Zedong came into power a civil war caused China's citizens experienced starvation, extreme poverty, and grief resulting in the loss of many innocent lives. In 1949 Mao banned birth control and stopped the trade of contraceptives in china. This caused the population to grow rapidly. Mao stated that, “If...
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...China 2.1 A brief introduction of Chinese market 2.1.1 The total market .China is one of the largest consumer markets in the world. At the end of 2013, China has a GDP of $9.24 trillion , increase7.7% over the end of 2012. During the first decade of the new millennium, China’s textile and clothing industry has been undergoing dramatic changes, and so has the market. With a population of 1.3 billion and rapid economic growth, China is now the biggest producer and exporter of textiles and clothing, also, it is a potential buyer and importer, backed by a fast-growing market. With the reform and opening-up, and the relaxing police of entry regulations into China’s domestic market, Chinese consumers today are provided with diversity choices and are exposed to fashionable value-added imports. 2.1.2 Key players in China’s clothing market . Overall1, the high-end domestic clothing market in China is dominated by brands from European and American, such as Giorgio Armani, CK, Chanel, and Dior. The middle and low end of the market are be controlled by a mixture of foreign and domestic brands, most of which are manufactured in China. Such as Nike, Adidas, Tommy Hilfiger, Zara and H&M. China’s clothing industry has a great competitive advantage in terms of labor cost, lead-time, the variety of products, and political stability from a Chinese perspective. Many multinational retailers, international fashion brands, and overseas trading firms also find that...
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...Gaurav Bhatia Logesh Kumar RC Naveen Kotni Prasun Parashar Ronil Sinha Tuhinadri Sarkar Analysis: Macroeconomic Indicators along with values is provided in the below table Macro Economic Indicators | Value | GDP Growth Rate | 9.1% | IIP Growth Rate | 14% | Agricultural Growth Rate | 4.3% | Fiscal Deficit | 800 billion yuan | Interest Rates | 6.56% | Exports | 180.2 billion USD | Imports | 148.5 billion USD | Current Account Deficit | 59.8 billion USD | Inflation | 7.65% | Foreign Exchange Reserves | 3.24 trillion USD | GDP Growth Rate: * GDP (purchasing power parity) of china is $11.3 trillion second largest in the world. * Most of the GDP is comprised of the exports. China is an export based economy. * GDP of China rose rapidly over past 33 years, Chinese households do not appear to have shared equally in that growth. * The Growth rate of GDP is averaged at 10% from past 5 years. Even during recession periods china GDP continuously grew at an average rate of 9%. There is a serious concern in the distribution of china’s GDP in which household expenditure and private consumption is low. * Falling share of private consumption and disposable income relative to GDP is largely caused by two main factors: China’s banking policies and the lack of an adequate social safety net. Chinese households put a large share of their savings in domestic banks. * The Chinese government sets the interest rate on deposits. Often this rate is...
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...China's population The most surprising demographic crisis A new census raises questions about the future of China’s one-child policy May 5th 2011 | BEIJING | The Economist * * DOES China have enough people? The question might seem absurd. The country has long been famous both for having the world’s largest population and for having taken draconian measures to restrain its growth. Though many people, Chinese and outsiders alike, have looked aghast at the brutal and coercive excesses of the one-child policy, there has also often been a grudging acknowledgment that China needed to do something to keep its vast numbers in check. But new census figures bolster claims made in the past few years that China is suffering from a demographic problem of a different sort: too low a birth rate. The latest numbers, released on April 28th and based on the nationwide census conducted last year, show a total population for mainland China of 1.34 billion. They also reveal a steep decline in the average annual population growth rate, down to 0.57% in 2000-10, half the rate of 1.07% in the previous decade. The data imply that the total fertility rate, which is the number of children a woman of child-bearing age can expect to have, on average, during her lifetime, may now be just 1.4, far below the “replacement rate” of 2.1, which eventually leads to the population stabilising. Slower growth is matched by a dramatic ageing of the population. People above the age of 60 now represent...
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...Bus 162 Team 7: HSBC in China 1. How has HSBC adapted its global strategy to operate in China, both before and after China’s WTO accession? Answer: Prior to the WTO accession negotiations, China’s banking industry operated as a cog in China’s centrally planned economy. The banks adhered to directed lending practices from the government and in turn created some of China’s most successful enterprises, but also supported thousands of other inefficient and unprofitable stateowned enterprises. This practice left state commercial banks with massive amounts of debt that was largely unrecoverable and hordes of nonperforming loans. In 1865, HSBC was founded to finance the growing trade between Europe, India, and China. HSBC rapidly expanded by opening agencies and branches across the globe, but maintained a distinct focus on China and the Asia-Pacific region. By the 1880s, the bank issued banknotes and held government funds in Hong Kong, and also helped manage British government accounts in China, Japan, Penang, and Singapore. After World War I and II, HSBC turned to dramatic expansion through acquisitions and alliances in order to diversify. The bank moved its headquarters in 1993 to London from Hong Kong and continued its global acquisition strategy. In December 2001, China finally acceded to the World Trade Organization (WTO). A number of policies were immediately implemented such as foreign banks were allowed to conduct foreign currency business without any market access restrictions...
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