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The Impact of China's Modern Foreign Policies on Economic Growth

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The Impact of China's Modern Foreign Policies on Economic Growth

Recent Chinese economic policies have shot the country into the world

economy at full speed. As testimony of this, China's gross domestic product has

risen to seventh in the world, and its economy is growing at over nine percent

per year (econ-gen 1). Starting in 1979, the Chinese have implemented numerous

economic and political tactics to open the Chinese marketplace to the rest of

the world. Just a few areas China's government is addressing are agricultural

technology, the medical market, and infrastructures, like telecommunications,

transportation and the construction industry. Chinese reform measures even

anticipated the rush of foreign investment by opening newly expanded industries

to out-of-country investors. Effects of this sudden change in economic strategy

by a world power can be felt by practically every nation of the globe involved

in international trade. The change in the amount of imports and exports to and

from China will increase the demand on countless markets, from automobile, to

petrochemical, to pharmaceuticals, and optical fiber. Also, with all the

foreign investment China is receiving, the socialistic republic will only grow

more and more interdependent upon the world economy. However, the impressive

growth rate of China's economy is not without its shortcomings. Problems such

as inflation and inefficient state-owned enterprises plague the rise of the

Chinese economy.

The main goal for China's modern foreign policies is the development of

the Chinese infrastructure. The significance of improved communication and

transportation cannot be over-stressed. Economically, enhanced means of

communication and transportation allows more expedient supply and demand

scheduling. Two of the latest Chinese reform measures to aid in the development

of the country are the Provisional Regulations on Direction Guide to Foreign

Investment and the Catalogue Guiding Foreign investment in China. Both these

policies place specific industries including telecommunications, machinery, and

electronics on top priority. Funding for these projects come from foreign

investments and appropriations from the Chinese government in the form of grant

financing, and legislative or administrative support.

Yet another example of the Chinese emphasis on industrial b...

... middle of paper ...

...pressive economic figures are through a thorough

renovation of Chinese trade policies. Reform measures in the country range from

reduced trade barriers and technical contracts for agriculture, to

infrastructure investment policies and improved standards for pharmaceutical

products. However, stemming from China's economic growth are dilemmas such as

inflation and uneven development of the country.

On a planetary scale, the effects of China's Open-Door policies are best

understood through graphical representation. One should graph the supply of Chinese goods and services and demand for Chinese products by other countries. As Chinese policies are placed in effect the supply curve shifts to the right because of improved quality standards and higher production capabilities. Open-Door policies also indirectly increase the demand for Chinese goods and services due increased Chinese competitiveness on foreign markets.

Works Cited

http://www.wissago.uwex.edu/test/joe/1992fall/intl2.html.

http://www.china-embassy.org/scitech/med.htm.

http://www.chinesebusinessworld.com/business/bgeneral/econ-gen.html.

http://www.dfait-maeci.gc.ca/english/geo/asia/china-tr.htm.
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