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Chinas Surge as a Global

Economic PowerGroup # 9Members

TriptiSabyasachi

RajanMrinalMirdula

Shiv Nandan

Group # 9

Tripti

Rajan

Sabyasachi

Mrinal

MirdulaShivnandan

Chinas surgeas Global

EconomicPower

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CHINAS SURGE AS ASUPERPOWER

China- as a global world superpower.

The icing on the cake- hugely successful

Olympic Games 2008.

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Chinese civilization originated in variouscity-states along the Yellow River valley

in the Neolithic era.Second largest economy whenmeasured on a PPP basis worth $6.9trillion

Third largest in the world whenmeasured in exchange rate terms, onlyafter USA and JAPAN.Called The People's Republic of China

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Political ScenarioPresident: Hue ZintaoPremier: Wen Jiabao

Wen

Jiabao

In 1995, China accepted the Nuclear Test Ban treaty.

Taiwan plays a central role in China's growing nationalismbecause it serves as a symbol of China's national tragedyduring the "century of humiliation.

Hongkong: China acquired Hongkong in 1997.

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Economy

Flash back

In 1949, China followed a socialist heavy industry developmentstrategy, or the "Big Push" strategy.

Consumption was reduced while rapidindustrialization was given high priority.

The government took control of a largepart of the economy and redirected resources into building newfactories.

steps taken for Planned development:1. Goal to make a technology sophisticated China

2. Focus on industrial sector

3. Policy of Great Leap Forward

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ContdNew era of Chinas economy:

Opening up of economy

Reduction of the role of ideology ineconomy

Political and social stability

Economic productivity Public and consumer welfare

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Actions taken..More dependence on foreign financing and

import,

Relaxation of restraints on foreign trade,Encouragement to Joint Ventures,

Urban economic reform was aimed,

Resource allocation by state discontinued.

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Current scenario post

global meltdown

GDP & Growth:

GDP(nominal) ofchina is ranked 4th in the world at$3.42 trillion

GDP(ppp) of china isranked 2nd in the world at 7trilion

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ContdInflation control:

Inflation has been growing at a

rate of 7.1% on an annual basis since 2004.Major concern of the Chinese lie in

the phenomenal increase in the price of foodgrowing at 18.2%

China has become the worlds manufacturinghub and the growing economy along with thesurging middle class has made it the secondlargest consumer of durable goods.

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AGRICULTURE China is the world's most populous country and

one of the largest producers and consumers ofagricultural products.

According to the United Nations World FoodProgram, in 2003, China fed 20 percent of theworld's population with only 7 percent of theworld's arable land.

China ranks first worldwide in farm output, and,as a result of topographic and climatic factors,only about 1015 percent of the total land areais suitable for cultivation.

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ContdAbout 45 percent of China's labor force is

engaged in agriculture.

There are over 300 million Chinese farmworkers - mostly labouring on small pieces ofland .

Yields are high because of intensive

cultivation.

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Contd China is the world's largest producer of riceand is among the principal sources of wheat,corn (maize), tobacco, soybeans, peanuts

(groundnuts), cotton, potatoes, sorghum,peanuts, tea, millet, barley, oilseed, pork, andfish.

Major non-food crops, including cotton, other

fibres, and oilseeds, furnish China with a smallproportion of its foreign trade revenue.

Agricultural exports, such as vegetables andfruits, fish and shellfish, grain products, and

meat , are exported to Hong Kong.

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Increases in Output of Major Agricultural

Products

(10,000 tons)

Variety 1949 1978 1999

grain 11,318 30,477 50,839

cotton 44.4 216.7 383.1

oil-bearing crops 256.4 521.8 2,601.2

sugarcane 264.2 2,111.6 7,470

tea 4.1 26.8 67.6

fruit 120.0 657.0 6,237.6

meat 220.0 856.3 5,960.9

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BANKING REFORMSChinas official currency, the Renminbi (RMB), is issued

and managed by the Peoples Bank of China.

China exercises centralized management over foreign

exchange, this function being performed by theGeneral Administration of Exchange Control.

In 1994, reforms were carried out in the administrationof foreign currencies, adopting a combination ofexchange rates.

These reforms opened up the economy to the rest ofworld

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EXCHANGE (SSE)The Shanghai Stock Exchange (SSE) was founded on

Nov. 26th,1990 and started its operation onDec.19th of the same year.

It is a non-profit-making membership institutiondirectly governed .

The SSE endeavors to realize a variety of functions

providing marketplace and facilities for thesecurities trading , disseminating marketinformation.

formulating business rules,

accepting and arranging listingsorganizing and monitoring securities trading

regulating members and listed companies

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SHANGHAI STOCK

EXCHANGE (SSE)The SSE has become the most preeminent

stock market in Mainland China in terms ofnumber of listed companies, number of

shares listed, total market value . December 2007 ended with over 71.30

million investors and 860 listed companies.

The total market capitalization of SSE hit

RMB 26.98 trillion. In 2007, Capital raised from SSE market

surpassed RMB 661.6 billion.

l b l

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Global SuperPower??Nuclear power

Balancing of inflation and growth rate

Sustainable economic growth rateVast scale of production

Cheap labour

Dragon headsForex reserve

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Nuclear PowerMain source of electricity: fossil fuelHydro Power generation: Three Gorges and Yellow RiverMoves to build nuclear power started in 1970.

With more than a dozen countries involved to some extent indeveloping Chinas nuclear industry, the impacts are alreadybeing felt. Nowhere else in the world can one observe acomparable variety of commercial nuclear technologies:

China has Canadian reactors.China has French reactors.China will soon have Russian reactors.And, of course, China has Chinese reactors.

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Nuclear Generation

Projection for Asia

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Chinas Nuclear

Projects Location

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Chinas Trade with the

world Chinas global trade surplus set another

record in 2007 of $262.2 billion, up 47.7%

Top export of China:

1. Electrical machinery (including consumerelectronics)

2. Power generation equipment

3. Iron and steel

4. Motor vehicle

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ContdChina's trade with the world $ billion

2003 2004 2005 2006 2007

Export 438 593.3 762 969.1 1218

% Change 34.6 35.4 28.4 27.2 25.7

Import 412.8 561.2 660 791.5 955.8

% Change 39.8 36 17.6 20 20.8

Total 851 1154.6 1421.9 1760.4 2173.8

% Change 37.1 35.7 23.2 23.8 23.4

Balance 25.5 32.1 102 177.5 262.2

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Chinas Top ExportChina's top export Jan- Nov 2007 ($ billion)

Commodity Description Volume % Change

Electrical machinery and equipment 271.3 31.8

Power generation equipment 207 23.1

Apparel 99.5 24.1Iron and Steel 90.2 52.4

Optics and medical equipment 33.2 12.5

Furniture 32.5 28

Vehicle other than railway 28.6 40

Inorganic and organic chemicals 27.2 30.2

Toys and games 24.8 19.3

Plastic and articles thereof 24.1 18.9

% change over Jan- Nov 2006

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ContdChina's top import ($ billion)

Commodity Description Volume % change

Electrical machinery and equipment 234.1 18.2

Power generation equipment 112.1 13.5

Mineral fuel and oil 94 13.4

Optics and medical equipments 62.3 16.6

Ores, slag and ash 47.9 65.1

Plastic and articles thereof 41.3 21.1

Inorganic and organic chemical 40.8 24.3

Iron and steel 28.3 15.9Copper and articles thereof 24.8 64

Vehicles other than railway 19.7 27.7

% change over Jan- Nov 2006

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Negatives Chinas strong economic growth has some clouds on

horizon, it cannot happen without access to vast

amounts of natural resources of the world. The construction boom has led to higher prices of

concrete copper and steel throughout the world.

The increase in automobiles purchased in China has

helped push global prices to record levels.

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ContdChina manufacturing has led to massive

layoffs throughout the world as factories areeither shutting down or moving to china tobecome compitative.

The inequalities particularly rural-urban has

been increasing as those left behind arebecoming restive.

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New Trends in China's

International Trade Heavy investments throughout Africa

Trade alliances all over the globe

Acquisition of natural resources

Long term economic planning

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Why China will beat the

global downturn?Balancing act with currency , foreign holdings,

inflation and growth.

Forex Reserves

Trade Surplus

Increased domestic spending

Regulations & Policies and their implementation

The spreading of its global trade

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