GDP The Gross Domestic Product (GDP) in China was worth 11199.15 billion US doll
ID: 1108488 • Letter: G
Question
GDP
The Gross Domestic Product (GDP) in China was worth 11199.15 billion US dollars in 2016. The GDP value of China represents 18.06 percent of the world economy. GDP in China averaged 1790.50 USD Billion from 1960 until 2016, reaching an all time high of 11199.15 USD Billion in 2016 and a record low of 47.21 USD Billion in 1962.
GDP growth rate
The Chinese economy advanced 6.8 percent year-on-year in the third quarter of 2017, following a 6.9 percent growth in the previous two periods and matching market consensus. It was the weakest pace of expansion since the fourth quarter of 2016, as fixed-asset investment rose the least in nearly 18 years while industrial output and retail sales increased further. GDP Annual Growth Rate in China averaged 9.69 percent from 1989 until 2017, reaching an all time high of 15.40 percent in the first quarter of 1993 and a record low of 3.80 percent in the fourth quarter of 1990.
For 2017, the Chinese government expects the economy to grow by around 6.5 percent, slightly below last year's 26-year low of 6.7 percent. Regarding property sectors, Beijing's efforts to slash debt levels and curb property speculation started to show an effect on overall growth.
On a quarterly basis, the economy advanced by 1.7 percent in the third quarter of 2017, compared to an upwardly revised 1.8 percent expansion in the previous three months and in line with market estimates.
Population
The total population in China was estimated at 1378.7 million people in 2016. In the past like 1950’s, China had a population of 552.0 million people.
Main Resources
With a total surface area of approximately 9.6 million square kilometers, China has large land resources and possesses strategic shares in various mineral resources. Due to its geologic preconditions, China has proved reserves of nearly all major minerals. As of 2015, proven reserves of iron ore in China had amounted to about 20.76 billion tons, ranking fourth in the world following Australia, Brazil and Russia. But due to the low quality of its iron ore reserves, the consumption of iron ore in China still heavily relies on iron ore imports.
The domestic economy in China is largely based on energy-intensive heavy industrial production. In order to maintain its growth momentum, the country has subsequently increased its primary energy production to approximately 3.62 billion tons of coal equivalent in 2015. China’s north-western regions such as Inner Mongolia and Xinjiang, the so-called Chinese coal belt, not only hold large reserves of coal but also petroleum and natural gas reserves.
Unemployment
The number of unemployed persons in China increased to 979 Tens of Thousands in the third quarter of 2017 from 976 Tens of Thousands in the second quarter of 2017. Unemployed Persons in China averaged 899.78 Tens of Thousands from 2004 until 2017, reaching an all-time high of 983 Tens of Thousands in the third quarter of 2016 and a record low of 810 Tens of Thousands in the first quarter of 2004.
Unemployment Rate in China remained unchanged at 3.95 percent in the third quarter of 2017 from 3.95 percent in the second quarter of 2017. Unemployment Rate in China averaged 4.11 percent from 2002 until 2017, reaching an all time high of 4.30 percent in the fourth quarter of 2003 and a record low of 3.90 percent in the third quarter of 2002.
Inflation
China's consumer prices rose 1.9 percent year-on-year in October of 2017, after a 1.6 percent rise in September and slightly above market consensus of a 1.8 percent gain. It was the highest inflation rate since January, cost of non-food increased further while cost of food fell much less than in a month earlier. On a monthly basis, consumer prices rose 0.1 percent, after gaining 0.5 percent in a month earlier while market estimated a 0.2 percent rise. It was the lowest monthly figure since July. Inflation Rate in China averaged 5.31 percent from 1986 until 2017, reaching an all time high of 28.40 percent in February of 1989 and a record low of -2.20 percent in April of 1999.
1. With this information, Make a SWOT analysis
2. And trying to discuss this country's membership and a strategy in "BRICS"
3. Think about potential benefits and costs.
Explanation / Answer
1.
Strengths:
The most important strength of China and the Chinese economy is the robust economy policy, a healthy GDP growth rate of over 6.5% that is backed by the abundance of natural resources and huge pool of human resources. Further, the ability to produce the power to meet the industrial needs and regular increase in the per capita GDP shows to strong domestic demand that is necessary for the Chinese economy to safeguard from the global fluctuations.
Weaknesses:
There are few weaknesses also as some of the natural resources are of poor quality, hence the there is a need of import from the other nations. There is a growing unemployment rate in the economy, causing a reason to have lower wages to the employees. the inflation rate is 1.9% as further increase in prices will cause the labors to demand higher wages.
Opportunities:
The low cost labor gives a cost advantage to the China as exports can be done to different international market. It makes the country to be one of the largest exporter in the world. A population over 1378.7 million people, create a pool that can meet all the supply needs of the economy. Further, the present of natural resources help China to meet all the energy requirements, for the development of manufacturing setups.
Threats
The quality products of other nations act as a threat the low priced product of China. Hence, the quality will be a factor that can threaten the products of China in the international market. Further, the other nations such as India and Brazil are attracting the FDIs. Hence, the attractive policies by these nations can cause a threat of relatively lower inflow of capital to the Chinese economy.
2.
China is the member of the BRICS group that is basically a group of emerging market economies. It involves Brazil, Russia, India, China and South Africa. These nations are vying for the FDI and attracting the MNCs to come and build the manufacturing bases. It means that all these nations are competing with the each other. Here, China’s biggest competitor is India as India also boast the low cost manpower with a huge population of working class people besides being a top IT products exporter. Hence, the China has to be strong in delivering quality while machining the low price advantage as the key part of the strategy to remain ahead of the other emerging market economies.
3.
Potential benefits are the increase in the credibility of the Chinese goods, new export opportunities and more capital flows to the China. Potential losses are the increase level of competition, loss of bargaining power in the international market and the presence of other attractive locations of the investments in other BRICS nations.
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