Economic Development of China

Growth in an economy that has been at a disadvantage in the past is known as economic development; a term generally applied to the increase of prosperity and quality of living in a developing country such as the situation we observe in China’s recent fast paced race to the pinnacle. The success of any countries development can be measured in terms of jobs created and their respective income; as well as its excellence in health and education and human development.

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China is the perfect example for a country in its prime economic development, due to its large growing population and its ambitious attempt to demonstrate to the world that they are serious and determined to make themselves a world power. Although, with any rising country, there comes its own advantages and disadvantages, such as environmental, medical and political problems which can affect the way the world views the country and its potential for continual growth.

Filled with prospect and risk, China offers a great atmosphere for investment and its impact on the world is growing at an exponential rate. To many countries in the world, China is known as the most cost effective country to manufacture goods, which is why many of them tend to import a lot of products from China. The consequence of such great demand for their production, and their large population yearning for wealth, is difficulty in controlling the quality of their products.

Without a strict enforcement of rules, manufacturers can get away with making products which may not be healthy for consumers because of the producer’s lack of quality control. When countries receive tainted/contaminated products from China, they will eventually stop purchasing from them due to the dangers of their products. The rush of foreign investment agents in China displays the reality that it is the fastest growing market to be operating in. They are set full steam ahead for what seems to be the fastest growing economy of the 21st century and pressure is upon them to fix all their problems.

Historically, China had been a leading country, impressing the world with its talents in various academic fields such as sciences and the arts. They hit a road bump in the 19th century as the country was in great turmoil due to war and famine; they suffered defeat and humiliation by such countries as Japan, Russia and Britain. The Chinese economy and the country itself began to bloom in the late 20th century, around 1980 China’s leaders decided to take a market-oriented route for economic development.

Because of this decision, China’s economic output has multiplied six times what it used to be! Due to the success of the country’s economy, poverty has diminished and the standard of living has increased tenfold. China is located in Eastern Asia and is slightly smaller than the U. S in land mass which carries many natural resources such as coal, natural gas and the world’s largest hydropower potential. China’s per capita income is near $5800, although it is hard to estimate due to the large gap between the rich and the poor.

Less than 8% of its population is living under its $1 per day poverty line indicating its extreme increase of living standards, since only twenty five years ago over 50% of their nation was living in poverty. Most of the poor citizens live in rural areas working with agriculture, and the richer families live in urban areas working with manufacturing; although China has recently decided to fund education and health care for its disadvantaged areas.

A difference in the poor and rich was inevitable, because of their migratory system named Hukou, residents had to file applications to move between rural and urban areas, which in turn prevented many of the rural citizens from benefiting and prospering from the country’s economic growth; whereas the citizens living along the coast received great opportunity as China opened themselves up to world trade and economic development. Because of their rapidly developing economy; manufacturers have been omitting large amounts of greenhouse gasses into the environment causing intolerable levels of air pollution in cities such as Beijing.

This can be dangerous for their economy because tourists will stop visiting the country and the Chinese citizens will develop health issues; for example during the 2008 Beijing Olympics, some athletes denied attending the games because they did not want to be perform in such heavy air pollution. A consequence to growth: China faces severe natural resource scarceness and environmental deterioration, because they do not have the land or natural resources to sustain their growth, they will have to spend a large amount of money importing from other countries in the future, as their own resources run dry and their population expands.

Along with a large population, many rampant diseases ran loose in China; 900,000 people are living with aids and the rare avian influenza which is contacted from birds is still alive in the country. Life expectancy for both males and females at birth is around 73 years of age, and the total infant mortality rate is about 21 deaths per 1000 births. China’s human development index which combines life expectancy, adult literacy and standard of living is 0. 777 ranked #81 out of 177 countries.

China stands as the world’s second largest economy next to the U. S; its creation of stock markets and foreign trade have aided in its current growth. * China has many major developmental challenges due to its large population and strong economy; they must focus on a few key points if they wish to maintain a healthy powerhouse. The environment and health issues would be the biggest concerns coming from China today. We have seen recently in the news, the effects of Chinas green house gas pollution, the amount of CO2 it emits into the environment because of its numerous manufacturers, as well as dangerous chemicals being found in their product.

The United States imported over $288 billion of products last year from China, and the effect of China sending out tainted products throughout the world could is devastating for the country and is only setting it backwards. Recent scandals such as the melamine chemical found in milk powder killed many babies, lead found in toys, poison found in pet food, and many other tainted or dangerous products all coming from China. If they want to be considered as a serious competitor in the world market, they must get their act together and begin inspecting and strictly regulating all the manufacturers in the country.

Other developmental challenges for China include dealing with their aging population, globalization and corruption. Failure to contain prevalent corruption among China’s leaders in both the political and corporate fields poses a threat to the nation’s future. Corruption has major repercussion outside its borders for overseas investment, international law and environmental/health safety, it also stimulates social strife and contributes to the rise in socioeconomic disproportion.

Roughly 10% of government spending is simply stolen or used as bribes; slack enforcements and incomplete economic reforms are some of the causes of China’s corruption. Corruption challenges social stability and aides in China’s degradation of the environment, social services and health care; it is an underlying problem to many of China’s current developmental challenges. The world has become much intertwined; every country now has a major effect on a global scale and China’s prosperity relies on the prosperity of the large powers in the world.

China’s ‘one child’ policy has left them in the dark when it comes down to supporting the large amount of elderly population. Most of the elderly populations still live in rural areas from where they grew up, whereas the younger population has traveled to the urban shores where corporations and business thrive, leaving the aged ones behind. Ever since the economic reform in the people’s republic of China began in 1979, China began to open up to the rest of the world, therefore making globalization a major issue for them to handle.

For so long in history, China had kept its society away from the world, and now that it has an open trading policy and participation in world groups (ex: world trade organization), although they don’t want their society to be diluted with American culture. Their challenge is to maintain a balance between both their culture and the rest of the world’s penetration into their society, while expanding and growing their international relations at the same time.

The major developmental challenge we must give priority to has been for-mentioned and is that of environmental and health concerns. The reason this issue must be given priority is because everything in this world depends on the future and how we treat it, the economy and our lives revolve around the nature of the environment and our health in general. We need air, water, food, and overall good wellbeing to function and rationalize as stated in Maslow’s hierarchy of needs, and without those physiological components, nothing else will matter to us until those needs are satisfied.

Thus, bringing us back to the point of China’s need to prioritize their environment and citizen’s health before anything else, if they ignore their air pollution, soil erosion and lack of water supply, there will be a point where it will affect their economy in a negative irreversible manner. Once the Chinese people realize health problems are on the rise and disease is rampant, no one will be concerned about their economy, and it will collapse as if it never existed. Another issue effecting global health from China has to do with the products being distributed throughout the world; China’s reputation on product safety has reached a new low.

Therefore, the need for a healthy population and a sustainable environment is both a basis and an essential for the growth and development of China. * China has intensified their efforts recently to improve the environment’s dilapidating conditions by creating a national climate change strategy. Regardless of growing awareness in China about the significance of the environment, pollution continues to rise at an exponential rate. The World Bank has reported that 16 of the 20 most polluted cities in the world are Chinese, some of which include: Beijing, Shanghai, Xian, Shenyang, and Guangzhou.

Manufacturers waste continues to be dumped into China’s waterways and air pollution causes 750,000 premature deaths every year. Due to the large amount of coal energy being used to satisfy the country’s quick expansion, the more companies that open each day, the more polluted the air becomes. Tainted milk with melamine has been the most recent scare in China’s ‘product line of danger’ (lead toys, poison food… ) and since China has been overwhelming the world with its ability to produce products at a cheaper price, everyone is lining up for an order.

Which in turn is putting pressure on China’s manufacturers to compete by multiplying there already maxed out production capacity and consequently losing quality control altogether. China has arrested people involved in selling melamine to the companies which are associated with the milk powder scandal, thus proving to the world that their efforts in supporting health safety are strong. New regulations and procedures were launched in an effort to re-establish consumer confidence and safeguard export markets after a large amount of recalls involving tainted products.

Although, every time regulations are placed, there seems to be a new scandal to occur months later, despite how reputable a company is, corruption flows all around. Chinese authorities and politicians are working hard to create a vigorous reporting system to catch any managers from cutting corners. If these problems with health issues are due to ignorance, the employees should be required to have robust training sessions on a regular basis. If the problem has to do with neglect and corruption, it will be up to the company CEO’s and ministry officials to oversee all the details.

A statement from a U. S official concerning lead paint on toys: “If we find that our lead paint ban is not being complied with, if we find violations, then we will not hesitate to take very stringent enforcement activities”*. This goes to show that the health and safety of China’s products can affect the growth of their economy and the world’s views, the same way China’s environment affects their economy and the world’s views. Efforts of controlling pollution have become a top priority among China’s leaders.

The government has recently expanded spending into protection for the environment and increased the strength of enforcement pertaining to the protection. China plans to reduce emissions 10% and increase energy efficiency 20% by the year 2010. During the 2008 Summer Olympic Games hosted in Beijing, drastic measures were made to reduce air pollution and clean up the environment before the games begun. They shut down 144 gas stations, restricted cars on the road, closed polluting factories and limited construction all to reduce air pollution.

The gaps and barriers in this issue have to do with the countries desire to build and grow while having a population of over 1 billion and foreign countries large demands and investments for their products. We’ve seen in Beijing how hard they worked to clean up the city before the Olympics, and the city was cleaner than it had ever been for that small period of time. This proves to the world that China has the capabilities to clean up their environment and enforce strict rules for health and safety.

The only thing that is getting in the way is their great yearning to become a super power in the world, as they were historically. They must continue to develop their country, which means creating more corporations and manufacturing that will pollute the environment due to the fact that they need to produce at low costs and don’t have the will to implement cleaner (also costly) manufacturing systems. The world loves importing from China because of the cheap costs for their products and the large amount they can offer, therefore countries such as the United States will always have a large demand.

With the pressure of producing at low costs, companies in China try to keep their employees’ wages low and find ways to produce cheaper products by purchasing materials that are inexpensive but not necessarily safe or healthy for consumers. Companies won’t take into account the amount of carbon emissions their plants are polluting, or how much energy they are wasting and all the dirt and garbage they are creating because they are too busy expanding/making money.

Due to the massive expanse of manufacturers and the corruption in the country, regulators and officials cannot keep up with every small detail, hence the rise in pollution and health issues from all the manufacturers. Pollution has its most serious impact on the poor who cannot shelter themselves; approximately 410,000 Chinese adults die each year from health problems related to the air and water pollution. To protect its forests and agriculture, China spent the equivalent of 6 billion U. S dollars to protect farm subsidiaries and forests.

The country has also banned shopping markets from offering free plastic bags, and now requires all stores to charge for the bags in an effort to reduce the use of plastic. How can these barriers be minimized or eliminated? My recommendation is that China should spend a very large amount of money and resources in controlling and monitoring manufacturers to make sure they meet regulations, as well as setting and enforcing strict emission standards for operating plants and automobiles as we do in North America. They should imitate the efforts they used in Beijing to display a clean country to the world.

It seems that they do have the ability to save their environment but they are more concerned about their economy/growth and are too busy to realize that their economy depends on the environment, and health of their population and of their clients. * China aspires to soon be a world power; their economy and country overall has developed so quickly that I believe there won’t be any noticeable environmental cleanup or an increase of health and safety in their products during the foreseeable future. As a country develops, they don’t usually focus on their environment as much as they focus on the growth of their economy.

In the past, many countries had large amounts of pollution due to their industrialization, and once they became fully developed and were satisfied with their standing in the world, they then focused on cleaning up the country and reducing pollution. The reason there is such a large focus on the environment in China is because it comprises of 1. 3 billion people. The effects of such a large population are easily noticeable throughout the world, along with the fact that we live in times that revolve around finding cleaner ways to live and ‘going green’; everyone has their eyes on China.

I believe the only way for China to begin noticing a much cleaner environment and producing top quality products is when they become a fully developed and reach their goal as a global superpower. Hopefully by the time China gets to the point where they want to focus on their environment, it won’t be too late and the damage will be reversible. When that happens, who will be the next country to produce cheap products and continue the trend China began to satisfy the dominant countries?