China Economic Analysis

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Amongst the top three economies of the world, and just after United States has more stable condition after the international recession as the world recovers from it five years after the biggest slump hit the entire globe. The trade partners stretch far and wide and its industries are strong enough to manufacture all kinds of stuff, with specialization in electronics in modern times. China has the largest population bench in the world, and thereby resources are needed to accommodate the citizens. Energy sources are a serious concern, for this purpose the government in recent years has started focusing on energy sources besides the conventional sources. Nuclear power plants and other renewable energy sources are in line for this purpose. Only recently did China become the world’s largest exporter to all parts of the world. This despite being the recession that has hit the entire world with its storm. While the period from 2008 to 2011 marked severe lows in the world market, china has shown better performances in terms of their economic growth, their exports and other variables. They have devised policies that ensure minimizing the deficit and losses due to recession. Though it would be a biased statement to say that it was not hit by the recession, it’s wise and safe to say that the policies crafted by Chinese helped resisting the global recession in a better and organized manner. Government has contributed in the field of state owned organizations and with its efforts has aimed at revamping the entire structure to strengthen this sector. In recent times, the G.D.P growth has come down slightly to a single digit value (Mundi). This has to do with the international recession, the domestic demand increase and various other factors. Still considering the nature of recession all over, this is considerable resistance with regard to the G.D.P decrease. Down slide on Chinese graph of economy and G.D.P will definitely effect the other pats of the world and their economies since its economy, exports and investments are spread are spread all over in the local markets(The Economist Online). Chinese exports find a large market in Europe and considering the inter dependence, with Europe still strangled deep into the economic crisis and with Euro issues looming dark over their markets, being a global player China is, it is bound to feel the heat from the Europe side and this could impact its G.D.P and overall economy’s progress. China’s success can be attributed to its separation of currencies on local and international front. Without any surprise people are advocating this form of approach for the euro crisis as well. After the policy change from 1980s, China’s policy depended largely on the private sector organizations, however having stabilized that pole, their forte in recent times has been the governmental organizations. They have regularized them, brought about necessary changes and provided them with the necessary security that would be demanded for the investors who are willing to invest in the state owned organizations. This is aided by the incentives attached to the investments in the government sector by both the local investors and the foreign investors. Having identified the achievements and the pluses that are there, there are obstacles at the same time that are being faced by the Chinese government and economy. One of these is the small domestic demand. this has largely got to do with the low capita income in domestic. The per capita income zone has the margin for improvement as it is relatively lower compared to other parts of the world and especially those countries that are in the rank and have some say and command over the international markets. Other problems and challenges faced include the handling of the large number of immigrants