China Case Study- NIC

Question 1

What was the GDP of China as of 2009?

Answer 1

$4.99 trillion, second to the USA

Question 2

What is the Chinese economies growth rate?

Answer 2

Average growth rate of 10% over the last 30 years

Question 3

China is the ________ largest trading nation in the world

Answer 3

Second

Question 4

What has increased along with personal income in China?

Answer 4

The production of goods for the domestic market

Question 5

What is China’s growth due to?

Answer 5

Massive investment in manufacturing-based industry and global trade expansion

Question 6

What did 1978 mark in China?

Answer 6

The change of policy in the government, the new leader Deng Xiaoping moved towards a market orientated economy, opening China to TNCs which wanted to use the country as an export platform

Question 7

Who did China become a competitor to after becoming an export platform for TNCs?

Answer 7

Other Asian TNCs such as South Korea

Question 8

Initially where was FDI encouraged in China?

Answer 8

Special economic zones along the coast

Question 9

What did China lack to make SEZ’s sufficiently attractive?

Answer 9

Legal infrastructure and knowledge of international practices

Question 10

What happened in the early 1980s in China?

Answer 10

An expansion of the number of areas which could receive FDI, with a minimum of red tape and accompanied by significant improvements to infrastructure.

Question 11

Where became designated for FDI in China in the early 1980s?

Answer 11

14 coastal cities (including Shanghai and Shenzhen) and three coastal regions became ‘open areas’ for foreign investment, providing tax incentives and other benefits

Question 12

What did China become after opening up further to FDI?

Answer 12

A factory of the world

Question 13

In 2001 China became the worlds largest recipient of FDI. How much did it receive in that year?

Answer 13

$53 billion

Question 14

Which organisation did China enter in 2001?

Answer 14

The world trade organisation- allowing better access to global markets

Question 15

What has China developed since becoming a member of the WTO?

Answer 15

A huge current account surplus

Question 16

What preconditions did China posses which were key to growth?

Answer 16

1. Cheap labour
2. A stable political system
3. Increasingly skilled and educated workforce

Question 17

China’s production costs are extremely low. How low are they compared to Japan’s?

Answer 17

10% of the Japanese equivalent

Question 18

What did China invest in? (Related to growth)

Answer 18

High technology

Question 19

Name 3 industries key to China’s growth

Answer 19

1. The energy industry
2. The manufacturing industry
3. The service sector

Question 20

What are some characteristics of China’s energy industry?

Answer 20

1. It has grown dramatically since 1980
2. 80% is from fossil fuels
3. Rich energy potential but the developed sources are inefficient and cause pollution

Question 21

What are some characteristics of China’s manufacturing industry

Answer 21

1. The petrochemical industry has grown rapidly since 2000
2. Machinery and electrical products are China’s leading exports
3. China is the worlds leading manufacturer of chemical fertilisers, cement and steel
4. Steel industry is important to all industrialising countries, China is no different. Steel was very small scale but it is now concentrated e.g. around Anshan
5. China is one of the worlds leading producers of nitrogenous fertilisers
6. Motor industry- shown most clearly how China’s economy has changed
7. Consumer goods: main emphasis on textiles and clothing- major parts of China’s exports

Question 22

Facts about China’s service sector

Answer 22

1. Ranks 7th in the world and will continue to expand
2. GDP per capita is still low compared to MEDCs, agriculture still employs a large workforce
3. Since economic reforms in the 1980s retail trade has expanded quickly. Urban areas have shopping malls, retail shops, restaurant chains and hotels
4. Tourism. Biggest boost to this industry came after the 2008 olympics. Forecast to be top the worlds tourist industry by 2020

Question 23

With regards to the income gap in China there are millions of people who live on less than $1 per day. How many did this number fall by from 1990-99?

Answer 23

150 million

Question 24

Where are the poorest areas in China and what does this lead to?

Answer 24

The rural, landlocked areas in the centre of the country. This leads to huge rural-urban migration.

Question 25

What has grown in some areas leading to out migration? (China)

Answer 25

Unemployment

Question 26

What has deteriorated in China leading to global concerns?

Answer 26

The environment

Question 27

What has soil erosion led to in China?

Answer 27

Large losses of arable land

Question 28

What type of pollution is a danger especially in China?

Answer 28

Air pollution

Question 29

What was the Chinese economy driven by (not good)?

Answer 29

Economy was driven by exports and investment rather than by consumption

Question 30

What are some of the concerns to outside observers of China?

Answer 30

1. Internet censorship
2. Suppression of religions theatre not officially sanctioned, especially evangelical Christianity
3. Lack of minority rights, especially Tibet and the western provinces where there is a large Muslim population
4. Strict limits on freedom of speech and freedom to publish dissenting views