(Solved) General Overview of China
Added on 2021-05-31
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General overview of ChinaChina has been ranked as the most populous nation in the world with a rich culture that dates back 4000 years[ CITATION TCT18 \l 1033 ]. Some products such as gunpowder, compass, andpaper constitute that fragments that make up China. Under the communist regime that lasted for more than two decades led by Mao Zedong, the founder of the People’s Republic saw China stagnate for more two decades. However, China has been categorized as a nation with the fastest-growing economy and as per the reports it is stated that China might be undergoing what is referred as the second industrial revolution. China has also put in place space exploration program and entails plans of establishing a space station by 2020.Currently, China has been identified as the global leading exporter and is attracting a lot of investments. Also, China is investing abroad in projects worth billions of dollars. Following the collapse of global export markets that was followed by financial crisis globally in 2009 saw China hit hard, though its economy rebounded first enough ensuring the country was back on its track. China overtook Japan in 2011 in becoming the second largest economy in the world despite the debt crisis that was evident in the eurozone in 2012 which played a critical role in dragging China’s growth as Eurozone was the largest market for products from China. China now benefits from a large access to international markets as it is a member of the World Trade Organization. However, China relations with trading members have been strained due to China’spiracy goods and the large trade surplus. This has led to increasing demands for Beijing to devalue its currency that will see currency value raised and this will make goods from China expensive for buyers and the overall effect will hold back exports. The economic differences thatexist between urban China and the remote hinterlands are among the largest in the global arena.
Over the past few decades, many rural dwellers that are impoverished have flocked to China’s eastern cities and this has led to China enjoying a construction boom. At the onset of 2012 for the first time, it was reported that the number of city dwellers seemed to outnumber rural population. The manifestation of social discontent is evident as revealed by demonstrations by both the farmers and employees. Thousands of individuals travel to Beijing annually to launch legal petitions with the courts in the hope of seeking legal redress for alleged corruption and grabbing of land. Other crucial matters entail corruption which impacts negatively on the development of society and the alarming rate of HIV pandemic. Environmental degradation has been propelled by the downside of the economic boom. China has been reported as the hub to many most-polluted towns globally.Campaigners from human rights continue criticizing China for the many executions that involve hundreds of individuals annually and for failing to eradicate torture as well as the continued censorship for artistic and political expression. China has been keen on stamping downon what it considers as dissent among ethnic minorities such as the Muslim Uighurs that occupy the North-west of China. The country’s rule over Tibet is considered controversial. The lobby groups from human rights blame the state of the destruction of Tibetan Buddhist tradition and theexecution of monks that were loyal to the Dalai Lama, a spiritual figure that was exiled for campaigning for autonomy in China.Economic factorsForeign Direct InvestmentChina continues to dominate and remains as the major recipient of the global hub of FDI over the past two decades. Reports indicate that FDI accounts for more than 25% of the value-
added production,4% of China’s tax revenue and more than 50 % of foreign trade[ CITATION Fog10 \l 1033 ]. Over 190 nations across the globe invest in the country and this entails 450 out of the 500 enterprises listed in the Worlds Fortune. In one of the surveys that were conducted by Member Priorities Survey, it revealed that most of the companies from the United States of America invest in China purposely to enrich the domestic market and not for purposes of exporting back to the United States. As per the estimates by UBS AG, the approximated gross shares of US, European and Japanese MNCs in exports from China was approximately 11% in 2009[ CITATION Fog10 \l 1033 ].Most exports were said to originate from Hong Kong and Korean enterprises. It is approximated that approximately 75% of the MNCs from the European countries and Japan are stationed in China to trade to the local market. However, a drop in foreign direct investment in the previous decades indicates that enterprises are losing interest in the Chinese market. Priority Sources of FDI for China have remained fairly constant over the past few years. Hong Kong leads the list and is closely followed by other nations such as the Virgin Islands and Japan[ CITATION Bai18 \l 1033 ]. The survey by Member priorities reported that more than 80% of the firms that operate in China are profitable.200820102012201420162018202020222024024681012GDP changes on annual basis(%)
AprilMayJuneJulyAugustSeptemberOctoberNovemberDecemberMONTHSOFTHEYEAR(2018)JanFebMarch0200400600800100012001400China's FDI in million($)The National Development and Reform Commission set up a good plan of managing FDIinvestment in China’s economy in 2006.The plan focused on the nexus between investment in China’s security and foreign investment. The commission directed the country to impound restrictions on holding of foreign firms. Foreign financing should be channeled towards industries that are high-tech, service industries that are modern and high-end manufacturing. TheNDRC is urging the MNCs to raise investment and establish production and assembly centers in China[ CITATION Ver18 \l 1033 ]. The primary motive would be to boost the autonomy of creativityfor Chinese firms.Outward FDI has seen China’s economy expand and prosper and China’s outbound directinvestment reached the target of about $73 billion by the close of 2016 financial year. Overseas acquisitions were the primary sources of Chinese outbound direct investment[ CITATION Ver18 \l 1033 ]. Hong Kong, the Cayman Islands, and the Virgin Islands classified as tax havens received approximately 81% of the total foreign investment[ CITATION Fog10 \l 1033 ]. The primary sourcesof outward FDI from China are the states in the Coastal and border territories. Provinces such as Fujian, Jiangsu, and Shanghai accounted for more than 60% of China’s outbound FDI[ CITATION
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