Chinese Economy Essay Samples
The global competition informs of export and manufacturing quality products is increasing at faster rate. This is occasioned by the immerging economies powerhouse and developing countries such as Brazil. These countries 15 years ago were not competitive in the global market. However, through various reforms and political stability of many nations across the globe, the international market has been flooded by various goods from these emerging countries. Additionally, the previous and current powerhouse such as Russia and United State are grappling and recovering from recessions and political issues which have affected their economy and international trade. This has given opportunity to emerging economies to exploit the international market and establish a solid base. Therefore, for china to be an international economic powerhouse it should substitute its current growth model of relying majorly on exports to one driven by market forces and competition within the private sector (Veasna et al., 2012). Although china has been one the fast growing economies in the world, the country’s growth rate have decreased over the past years and this decline has been a source of concern for the government. For china to experience sustainable economic growth, it needs to maintain both social stability and communist party’s legitimacy. China can transform its current growth strategy to one that is based on innovation and entrepreneurship.
The first growth engine for China is to replace the cheap labor strategy since it will contribute positively to economic development by improving the job market through creating new employment opportunities. It will also stimulate innovation and increase market competition. Secondly, China will need to improve the education system by providing people with an easy and efficient access to secondary education and extensive vocational schooling relevant to the development of new target sectors. This will make china to have the most skilled labor force in the world.
Another growth engine for China is to increase the pace of innovation by continuously investing in research and development. This will increase the pace of achieving sustainable growth. Therefore, the government should take more steps to build national research network and connect with the global research and development (FAO, 2014). There is also a need for china to improve on green development by employing extensive research on this area. The government needs to pay attention to efficient and modern sources of energy which are cheap and last for a long time compared to current fuels which are uneconomical and pollute the environment. The green energies will save the country a lot of cost and expenses associated with the non-renewable energies and their pollution effects. Efficient use of the natural resources, environment sustainability and energy efficiency, will move the counties economy to a greater height by reducing the government expenditure, attract investors and fight pollution.
Moreover, China government should establish private savings and private investment as this will intermediate all domestic savings into domestic investment and this move help to improve the social welfare and lower the saving rate (Bloomberg News, 2015). Lastly the Chinese government should stimulate an increase in household consumption by increasing wages and lowering the level of inflation as this one of the ways to improve the welfare of its citizens. More consumption will definitely appropriate exports and investment due to increase in demand for goods and services.
The new measures will spur a normal growth for china economy. However, the growth will not be as fast as expected but a steady annual growth rate of about 7% is expected each year or even a little bit higher (Bloomberg News, 2015). This growth rate will be higher than other major economies in the globe (Wang, 2015). The government is optimistic that the 7% growth will be possible and sustainable.
Andong Zhu and David M. Kotz. (2010). The Dependence of China's Economic Growth on Exports and Investment. Retrieved from http://people.umass.edu/dmkotz/China_Growth_Model_%2010_09.pdf
Bloomberg News. (2015). Xi Says China Must Adapt to ‘New Normal’ of Slower Growth - Bloomberg Business. Retrieved from http://www.bloomberg.com/news/articles/2014-05-11/xi-says-china-must-adapt-to-new-normal-of-slower-growth
Edward Wong. (2010). Log In - The New York Times. Retrieved from http://www.nytimes.com/2010/06/25/world/asia/25china.html?_r=0
FAO. (2014). Rapid growth of selected Asian economies. Lessons and implications for agriculture and food security: China and India. Retrieved from http://www.fao.org/docrep/009/ag088e/ag088e04.htm
Veasna Kong, Adam McKissack and Dong Zhang. (2012). China in a new period of transition | The Treasury. Retrieved from http://www.treasury.gov.au/PublicationsAndMedia/Publications/2012/Economic-Roundup-Issue-4/HTML/article2
Wang Yong,. (2015). The new normal of Chinese growth | East Asia Forum. Retrieved from http://www.eastasiaforum.org/2015/01/22/the-new-normal-of-chinese-growth-2/