Chinas Economy - Assignment Example

The military power, technological advancement and the currency of China have drastically improved over the past years, which is a sign of economic dominance. These aspects of the economy combined with the fast growth are likely to surpass those of the United States. According to IMF, THE CHINESE ECONOMY GREW BY AN AVERAGE OF 9.6 PERCENT PER YEAR BETWEEN 1990 AND 2010 (Babones, 2011). This projection indicates that China has one of the fastest growing economies in the world. The country survived the global financial crisis of 2008 and managed to expand its economy, which indicates real economic supremacy.

CHINAS ECONOMY HAS BEEN TRANSFORMED BY SUCCESSIVE WAVES OF ECONOMIC REFORM (Naughton, 2007). Market transition has led to a market economy dominated by exports and multi-national firms. The country has managed to dismantle the command economy and decentralize the effects of communism in order to create a market economy and empower the rural people. This has created a fair playing ground for market participants, which has extended to the international market. This has led to the sudden rise of China as a global trading center and several investors have invested in Chinese firms.

ECONOMIC REFORMS HAVE FAVORED FOREIGN INVESTMENT, WHICH HAS ALLOWED FOREIGN FIRMS CLAIM A SHARE OF INDUSTRIAL EXPORTS (Gilboy, 2004). The government has also been instrumental in supporting the private sector by giving private companies access to capital, technology, and markets. This has improved the output from these firms and their contribution to the country’s GDP, which has strengthened Chinas’ economy. OVER THE PAST 30 YEARS, CHINA HAS EXPERIENCED THE GREATEST AND MOST RAPID REDUCTION OF EXTREME POVERTY (Katz, 2008).

The country has improved the living condition of the poorest people in the country and reduced poverty levels. The continuing growth rate has improved the living conditions of the Chinese people, which have supported economic supremacy of the country. THE RAPID ECONOMIC GROWTH HAS IMPROVED THE ECONOMIC WELL-BEING OF THE CHINESE PEOPLE AND ALTERED THE STRUCTURE OF THE SOCIETY (Pei, 2006). The economy is less state-centered as was the tradition, which has enabled the country consume much of its products by improving the living condition of the population.

Chinese citizens have improved their access to information through telephones and televisions. These have improved the communication and transport industries in the country, which are some of the rapidly growing industries in the country. The contribution of these industries in the country’s GDP has helped improve the economy and expansion into the global economy. China has experienced high levels of savings and investment, which has contributed to the rapid economic growth. INVESTMENT RATES IN CHINA ARE MUCH HIGHER THAN IN OTHER COUNTRIES WITH COMPARABLE LEVELS OF PER CAPITA INCOME (CSIS, 2006).

This has enabled the growth of per capita stock that has facilitated the transition from agricultural labor to the modern sector. The investment into the modern sector has introduced a center for a new labor force that has improved the output from the sector. FACTORS OF PRODUCTION SUCH AS LABOR AND CAPITAL HAVE CONTRIBUTED TO CHINA’S ECONOMIC GROWTH (Angang, 2011). The savings from the labor force have improved the purchasing power of the population. Direct investments in the country have improved capital formation that has helped the citizens improve their savings and their purchasing power.

This has helped improve the country’s GDP and its competing abilities with superpowers such as USA. ASIA’S PRODUCTION ASSEMBLY HAS ATTRACTED SEVERAL INVESTORS FROM