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1. Cheap Labour
China has a large unskilled workforce willing to work for low wages. In the north many farmers struggle to make an income, therefore, they are willing to move south and work in manufacturing for low wages. Therefore, despite high growth, wages have remained low. Cheap labour has also helped avoid wage inflation.
2. Government Policy
The Chinese government have been keen to promote economic growth (they have been concerned about unemployment from privatised industries and agriculture). Therefore, they have kept the Yuan undervalued. This makes Chinese exports more competitive and has helped the exporting sector. The government have also kept interest rates relatively low. Low interest rates have also encouraged some irresponsible lending.

3. Raw Materials.
China has good reserves of raw materials such as coal. However, for many raw materials they are net importers. This is true, particularly, for metals, oil and precious commodities.The demand from China is one of the main reasons behind the boom in commodity prices. Therefore, we could say China has experienced growth, despite having to import so many raw materials.

4. Investment from Overseas.
This increases productive capacity and helps improve technological development. However, as a % of GDP investment from overseas is relatively low.

5. Education
There is a growing, educated, middle class, which has enable the economy to diversify out of manufacturing. Education will be of increasing importance as China tries to provide greater value added to its industries.

Challenges Chinenese economy is likely to face in the near future.

Long-term inflation:
Chinese consumer price inflation has gone from 6.5 percent in 2011, down to 2.2 percent in June 2012. Inflation is an intermediate to long-term problem for China.

Constraints on resources and environment are

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