The impact of the global financial crisis on Chinese economy In the past two decades, China has enjoyed the one of the world’s fastest growing speeds. And for right now, China has been the most major contributor to the world economic growth. But in the recent years, the global financial crisis already did a huge damage to the Chinese growing economy. Especially in the aspect of exporting sector, China has been hit hardly by this crisis. The dramatic fall of external demand led to dramatic slowdown of the economy, and tens of millions of worker in the factor was laid-off during the crisis. Considering to Chinese government, it is critical for them to keep a stable growth which is viewed as the way to maintaining social stability. Because China, right now, is the major economic power in the world, and holding extremely huge amount of foreign exchange reserves, it is important to care about Chinese economy situation. This literature review is designed to cover the recent research paper focus on the topic of the global financial crisis and how it influence Chinese economy. The correlation of GDP growth between China and G-3 economies Ligang Liu (2009) used the method of correlation analysis to illustrate the correlation between China and G-3 Economies, from 1981 to 2008. As he mentioned, trade and foreign direct investment are two important sources of economic growth in China. G-3 economies are not only important sources of capital inflows to China but also important markets for China’s exports. In 2008, the trade between China and G-3 took about 50 percentage of the Chinese total exports. This number indicates that Chinese economy and G-3 economy have a strong interdependency relationship. From the table which concludes resul... ... middle of paper ... ...Policy Response, 2008 Institute of World Economy and Politics, Chinese Academy of Social Sciences Ligang Liu, Impact of the Global Financial Crisis on China: Empirical Evidence and Policy Implications, China & World Economy, 1-23, Vol 17, No.6, 2009 Fung, K.C.(2009), “Global and Regional Supply Chains and Chinese Exports,” presented at EAI Distinguished Public Lecture, National University of Singapore. Yuqing Xing(2009), The Global Economic Recession and Challenges to China’s Export-led Growth Strategy, Conference on Global Economic Crisis: Impact and Implications for Industrial Restructuring in Asia Jikun Huang, Huayong Zhi, Zhurong Huang(Chinese Academy of Sciences), Scott Rozelle, (Stanford University), USA, John Giles (World Bank), The impact of the Global Financial Crisis on Off-farm Employment and Earnings in Rural China, World development Vol. 39, No.5.
Fan, G., and X. Zhang. "How Can Developing Countries Benefit from Globalization: The Case of China." Eldis. N.p., n.d. Web. 20 Apr. 2014.
With the development of China, the economy of China has become the World’s second largest after the US. On the other hand, the ...
The United States and China share the most imbalanced bilateral trade relationship in the world. The United States imports more goods from China than it exports to a tune of $202 billion dollars each year. All told, China alone accounts for nearly 26% of the United States' $725.8 billion trade deficit. “Increasingly, this imbalance has been the subject of a major political backlash within the U.S. congress, where some have charged that the US is destroying its industrial base to support a communist country's industrialization." http://worldnews.about.com/od/china/a/china_trade.htm
Huang, Y. (1999). The Last Steps Crossing the River: Chinese Reforms in the Middle of the East Asian Financial Crisis. New York: Graduate School of Business, Columbia University.
Sachs, J. D., & Woo, W. T. (1997). Understanding China's Economic Performance. NBER Working Paper .
For the past twenty-five years, China has witnessed an overall increase in its domestic growth (Fischler 148). According to the article, “The Rise of China as a Global Power,” by Dr. Rosita Dellios, China “is the world's fourth largest trading nation, rising from 32nd in 1978 to 10th in 1997.” Similarly, China’s GDP is also second to the United States of America, generating 13 percent of the world’s output (Dellios). Since China’s introduction into the World Trade Organization in December 2001, its average tariff dropped from 41 percent in 1992 to 6 percent in 2001, becoming one of the most open economies in the world (Dellios). China is also the world’s fastest developing economy, obtaining an annual growth of 9.5 percent through foreign direct investment, low labor rates, emerging markets, and growth expansion. (Dellios). Therefore, the 21st century has been titled the “Chinese Century”, as China has become the second-largest international economy in the world (Ji-lin 15).
However, the impact it has made on China can be considered to be great as it brought China under the limelight in the global economy. Globalization has had many positive and negative ramifications on the Chinese economy. In the short run, it may be so that the negative impacts outweigh the positive impacts, but that is easily debatable. This is because all the negative impacts of globalization can be corrected with economic policies that can be efficiently undertaken by the Chinese government. In this manner, China in overall will be able to enjoy all the benefits of globalization and contribute more to the rest of the world as it continues to grow economically and socially. In today’s world, globalization is an important part of the development and prosperity of each nation and China too should be able to reap from its benefits. Today, as China proudly holds a place in the global economy as the world’s second largest economy and most populated country in the world, it can be said
China’s economy has been changed by continual influences of economic reform. Before 1949, China was a traditional society with a traditional household-based economy. To illustrate, 90 percent of the population living in China lived in rural areas and depended on agriculture. However, “China’s new leaders turned their backs on China’s traditional household-based economy, and set out to develop a massive socialist industrial complex though direct governments control” (Wei & Rowley, 2009).China shaped its economy from socialism for 30 years until it became associated with major shortcomings. As a result, China launched economic reform which transformed China’s economy from a “Soviet-style centrally planned economy to a more market-oriented economy, but still within a rigid political framework of Communist Party control “(Wei & Rowley, 2009).
The impact of globalisation on the Chinese economy can be seen through the increase in economic performance. Over the last two decades, the Chinese economy has experienced significant economic growth due to globalisation. Globalisation is responsible for reducing the barriers to trade and increasing the integration between different countries and economies. The reduction of trade barriers as well as the increased integration between different countries and economies resulted in an increase in foreign investment and international trading which leads to economic growth. China has experienced significant increases in international trading and investment flows. This is supported by the world bank which states that in 2010, China contributed 13.6% to global growth and was responsible for approximately 9.4% of W...
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). This further predicted the country to record the highest GDP growth in the whole world.
In the first part, we are going to take a closer look at China’s economy by analyzing its external trade relations within the region...
We all know that the foreign investment is a necessary part of global expansion. Many developed countries prefer to invest developing countries. For instance, the US has invested much more fund in China. Since the initiation of its market reforms in the 1980’s. China has been a preeminent recipient of foreign direct investment (FDI). Until 2011, there is over $1.2 trillion have been invest in China as foreign direct investment, it made Chinese industries has been transformation, and contributed enormously to the nation’s industrial output. In addition, the more foreign manufactures, the more Chinese subsidiaries have dominated (Wei, Xiao & Yuan, 2014).
Xingzhong, LI Daokui David YIN. "The International Monetary System in the Era of Post-Financial Crisis: What Policy Options Does China Have?[J]." Journal of Financial Research 2 (2010): 005
The rise in China from a poor, stagnant country to a major economic power within a time span of twenty-eight years is often described by analysts as one of the greatest success stories in these present times. With China receiving an increase in the amount of trade business from many countries around the world, they may soon be a major competitor to surpass the U.S. China became the second largest economy, last year, overtaking Japan which had held that position since 1968 (Gallup). China could become the world’s largest economy in decades.
...st and stand in the world. It is predicted that China will one day be the largest economy growing country in world. They continually growing and rebalancing their world to be the best. The growth of economy will depend on the Chinese government comprehensive economic reforms that more quickly accelerate in China transition to a free market economy. The consumer demand, rather than exporting the main engine of economic growth; boost productivity and innovation; address growing income disparities; and enhance environmental. (Morrison, 2014,para2)