Source: economic-research.bnpparibas.com
Topic: China's Economic
Sort Desciption: July 2006 Conjoncture2 C hinas remarkable economic expansion has been reflected in very strong growth rates, rapid integration into international trade and growing influence on the world economy.
Content Inside:
July 2006
Conjoncture2
C
hinas remarkable economic expansion has been
reflected in very strong growth rates, rapid integration
into international trade and growing influence on the
world economy. This strong economic performance has been
accompanied by growing financial and social imbalances.
Disparities between urban and rural areas, in terms of
revenues, education and healthcare, are growing. The
recurrent concern as to Chinas political and social stability
has intensified in line with growing and increasingly tough
social unrest in recent years. Reflecting latent discontent that
is accumulating and growing among disadvantaged
populations and those left out of the economic growth, this
social unrest is increasingly worrying for the Chinese
government which fears that social instability could weaken
the present regime.
Remarkable economic expansion
Rapid growth…
Chinas economic growth has been exceptionally
strong over a long period, 9.8% per year on average since
1980. Arapid increase in Chinas weight and influence in
the world economy have accompanied this. In 2005,
Chinas GDPamounted to USD2,200 billion, or 5.5% of
world GDP. This is more than three times the level in the
1980s, when Chinese GDPamounted to 1.5% of the
world total. The Chinese economy now ranks fourth at
world level, behind the US, Japan and Germany and
ahead of the UK and France. In terms of foreign trade,
Chinese exports accounted for 7% of total world exports
in 2005, behind the US (9.5%) but ahead of Japan (5%).
… accompanied by significant domestic imbalances
Nonetheless, despite the surprisingly regular pace of
growth, barring 1990 when growth was only 3.8% in the
wake of Tiananmen events, the nature of the economic
cycle has changed. The previous cycles (early 1980s and
early 1990s) were driven mainly by consumption
whereas the present cycle is driven mainly by
investment. The massive scale of these investments has
r ...
