Shortly after Mao Zedong’s death in 1976, the People Republic of China embarked on a gradual process of economic reform and liberalization. Under the initial leadership of Deng Xiaoping, China quickly began to receive foreign direct investment (FDI) from around the world. Initially Taiwan, Hong Kong, and ethnically Chinese overseas regions of Asia, such as Singapore and Malaysia, were the largest contributors of FDI to Mainland China. Despite these regions’ large contribution to investment in China, there is a common misconception that most of the investment in China has come from the “western” countries, such as the United States and members of the European Union (EU). This misconception is understandable because FDI from the US, European Union, and Japan accounts for 90% of outward FDI stocks and flows (UNCTAD, 2002).
During the 20th century, the world believed that the renowned cities of the United States would provide modern spectacles emanating with futuristic qualities. However, within the past decade, the influence of China has creeped into the party of global dominance, establishing their footing on an international scale at a significantly alarming rate. In China, you can now experience the tallest skyscrapers, the newest airports, the fastest highways, and the best electricity grids in modern technology (Roasa). China’s evolution of success on the global scale is implemented by their supremacy in the economy through the labor of their workforce, which ultimately instills political power available at their fingertips. With this underlying superiority, the impact of China’s influence of economic power can affect international political and societal aspects, as they establish their economic empire in roots all over the world.
Chi... ... middle of paper ... ...gtonpost.com/2014/03/09/china-pollution-rules_n_4927591.html>. Xinhuanet. "China unveils landmark urbanization plan - Xinhua | English.news.cn." China unveils landmark urbanization plan - Xinhua | English.news.cn. N.p., 16 Mar.
By the end of 2010, China with a GDP of $5.8 trillion, surpassed Japan’s GDP of $5.48 trillion, became the world’s second largest economy system (BBC). China also exceeded Japan became America’s largest foreign securities holder. Since then, China has been seen as the US’s biggest opponent in economic field. Some economists even say that in 10 years, China will be the same size as the US economy. No matter whether China is going to reach the US’s economy size in 10 years or not, after forty years since the US first opened trade with China in 1972, America’s economy gradually relies on China’s economy and will collapse without the strength of China’s market.
From the 1970s, there has been a wave of liberalization in China, which was introduced by Deng Xiaoping. This is one of the key reasons to the rise of China to be one of the economic giants in the world. In the last 25 years of the century, the Chinese economy has had massive economic growth, which has been 9.5 percent on a yearly basis. This has been of great significance of the country since it quadrupled the gross domestic product (GDP) of the country thus leading to saving of 400 million of their citizens from the threats of poverty. In the late 1970s, China was ranked twentieth in terms of trade volumes in the whole world as well as being predicted to be the world’s top nation concerning trading activities (Kaplan, 53).
Peter Hays Gries, China's New Nationalism (Berkeley, CA: University of California Press, 2004). David M. Lampton, Same Bed, Different Dreams: Managing U.S.-China Relations: 1989-2000 (Berkeley, CA: California University Press, 2001). Robert ,Sutter, China's Rise in Asia: Promises and Perils (Lanham, MD: Rowman & Littlefield, 2005). Ming, Xia. “China threat or a peaceful rise of China”, The New York Times, March, 2006.Web.
China’s competitiveness in international trade: The impact of innovation and human capital – Review of empirical literature. WORLD ECONOMY RESEARCH INSTITUTE, 310. Krugman, P. (2013, July 18). Hitting China's Wall. The New York Times.
Spurred on by reforms, China has become the second largest economy in the world and is projected to surpass the US in the near future. With its increasing economic size, there has been a commensurate increase in global status. It has, however, attracted scrutiny in terms of its status and intentions within a western defined international order, especially in the role of security and defence. China attempts to allay these concerns, in part, by promoting a peaceful development thesis, and publishing more information. The latest Chinese Defence White Paper was released on 16 April 2013 and comprises of a preface, five specific chapters and a conclusion.
The Fall of The Orient. Zhiwu Chen, a professor of Finance at Yale School of Management, had once addressed two pivotal questions to the world: “Why has China’s economy grown at such a fast rate during the last 30 years, and is this growth rate sustainable?” Over the past decades, China’s uprising as a huge economy power was undeniably prominent, first in Asia and then to the eyes of the world. The most popular answer as the world knows it is because China has “vast and cheap labors”, but that is not necessarily true. The idea of China’s development has been supported not only by huge labor force. Instead, it was also driven by all the changes that happen in the world, which allowed China to gain from its labor force, and also improvement in technological developments, and social reformations (Hayat).
Between 1949 and 1972, there was no trade between the United States and Mao’s Communist China. In late 70s, China went through economic reforms and global trade increase ten times. Since the late 80s, United States has had a bilateral trade deficit with China; annual deficits increase throughout the 90s, and increase rapidly in the first half of the 21st century (C. Fred Bergsten,Bates Gill, Nicholas R. Lardy, Derek J. Mitchell, 2006). At the beginning of 2008, America and China are each other’s second largest trading partner, while China has replaced Canada as the largest exporter to the United States. Today trade deficit with China is 28 times larger than it was during the Reagan era, according to new figures released by the U.S. Census Bureau.