My interest in China originated from their current economic standing. I find China’s position in the world economy very interesting because this is the most interdependent country. The recent stunt in their economy’s growth highly affected other countries markets, including America. This is a representation of how deeply rooted China’s economical presence is around the globe.
China’s economic stance has drastically changed within the past 50-60 years. Up until 1949 China was known as Republic of China, but after the civil war the Communist Party of China took control and the People’s Republic of China took place. Under this rule China was known as a very strong centrally planned government. However, after Mao’s death in 1976 the new ruling government decided to move the country into a free market economy. The ...view middle of the document...
This ranking represents the culture’s hunger and ambition for success. This mentality plus its enormous population of 1.35 billion people is how China has the fastest growing GDP. For the past decade China’s GDP has had an average growth of 10% per year. This has highly benefited the standard of living for the Chinese, however, this growth is arguably too fast for the adequate economic transition. For example, many foreign companies quickly took notice in China’s opportunity and invested many resources and money into the country, however, all of this investing occurred partly due to China’s lenient labor laws. Although, foreign companies interest helped China’s GDP, these companies also took advantage of the Chinese people. Although China’s economy is based on a free market system, the Chinese are still governed under a socialist government. This means that most of China’s home businesses and resources are owned by the government. The consequence of this is that a majority of Chinese workers are still prohibited from further growing in their career.
China’s recent economic stunt was due to the price bubble investors created. Foreign investors invested things such as the Chinese stock market to Chinese governments. But what was wrong with these investments was that the stock and company values were over priced according to their actual book value. In other words, people investing in China expected it to continue to have this rapid increase, however, the Chinese government is starting to be less lenient and regulating more of the foreign companies. Therefore, the small decrease in growth in China has many investors worried because they have realized that China’s investing opportunities could have been over valued. Currently, all countries are closely watching China’s actions because they highly depend on China’s economy.
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