China 's Impact On Future Of Chinese Economy

These effective strategies helped Hong Kong overcome the financial crisis. All these facts fully demonstrated that China is a responsible big country. After the Asia financial crisis, the importance of China's economy has been brought into focus; China's neighboring countries have begun to recognize the influence of the Renminbi.

* From planned economy to free market powerhouse: The post - Mao era ( 1976 onwards )

Ancient China’s rich history has a direct influence on the China of the 21st century. First, the immense importance of the cultivation of rice, which became a staple source of food in China for centuries. Next, the primary source of accounts of ancient china comes from the Shujing, which spanned the Xia, Shang, and Zhou empires. Furthermore, The power women could hold reached its heights during the Shang empire, and underwent a downward trajectory during the Zhou empire. Moreover, regime changes have had a unique outcomes in China due to the “Mandate of Heaven” which gave new regimes the control over the civilians of the conquered empires. Lastly, the decline of the Zhou came about from the power of local rulers who began to seek their own interests. Ultimately, the mandate of heaven bears responsibility for keeping China intact for centuries regardless of conflicts and shifts in power.

In 2008, the Global Financial Crisis broke out; both the American economy and the economy in the West suffered a hard blow. However, a big economy system in the East emerged unexpectedly. China is now able to challenge the America’s decades-long dominant position in economic area. Started during the middle of 1990s, China’s manufacturing industry developed rapidly that billions of exports were floating out, and China was given the title of “the world’s factory”(BBC). By the end of 2010, China with a GDP of $5.8 trillion, surpassed Japan’s GDP of $5.48 trillion, became the world’s second largest economy system (BBC). China also exceeded Japan became America’s largest foreign securities holder. Since then, China has been seen as the US’s

In the late 1990’s, there was a boom and bust on information technology stocks. Because of that, a mild recession happened in 2001. The mild recession made people have over confidence to the stability of financial system and the whole economy. Therefore, the authorities started to ignore the work of keeping financial stability.

For the past century, Chinese society has felt a compulsive desire to develop at breakneck speeds. In pursuing development, China’s primary goal has been to display its sophistication to the world, rather than to directly aid the welfare of its citizens. Following this hierarchy of objectives, China has continued to relentlessly modernize despite enormous negative consequences; the development powered through famine during the Great Leap Forward, violence during the Cultural Revolution, and economic dislocation during liberalization, accepting negative consequences as bearable burdens on the path to global renown. Ignoring these issues, China has proven itself more responsive to international views of modernity than to immediate national

China’s financial markets are still fairly primitive however China has one of the highest saving rates in the world. This is Largely due to rising incomes, but also due to the lack of a robust social safety net to protect citizens from changing economic circumstances such as unemployment and population ageing. The banking sector was only opened to foreign competition at the end of 2006. This forced Chinese banks to become strong and efficient so as to compete with the international banks. In making the banks more efficient, state owned enterprises also had to increase their efficiency as they no longer were allowed to take low cost loans that were running at a loss for the state bank. These economic developments coupled with increased prudential standards and the improvement of lending practices has allowed for savings to be allocated efficiently for investment purposes, to support medium term growth in the Chinese economy.

China has long since been recognized in the world for its natural and man-made products such as its silks, satins, and its delectable cuisine. During post classical China, China’s influence was not only spreading across the country, but was spreading across the world. Economically the Chinese ideas and innovations began taking full affect across Eurasia. The Chinese art of producing salt by solar evaporation soon spread to the Islamic people, as they began using the technique for themselves. Other Chinese innovations such as papermaking, printing, and gunpowder all began to spread to other civilizations such as Korea, Vietnam and Europe. With the creation of canals, networks commerce, waterways, and technological achievements, the Grand Canal,

Communist countries like China limit the rights of their people. Without these guaranteed rights, average Chinese citizens do not have the ability to gain and create wealth, like those in western capitalist societies. As McGregor described in The Party only those who hold government or influential roles in the society have the capability to create wealth. The society gives the citizens what they need and shelter then from the excess supply that is available. With this in mind, it is relatively impossible for communist Chinese people to create the wealth described in The Big Short. The Big Short by Michael Lewis describes the story of how economically savvy investors would use financial markets to bet on the mortgage collapse. As a result, this leads to heavy government influence in the free markets. These investors would use financial instruments to create things such as leverage so they would make 100 to 1000 for each of their one dollars invested. This created the 2008 banking crisis. This crisis allowed for big name company and property owners to take advantage of different types of

For many decades, China has always been technologically and economically ahead of Europe. The invention of gunpowder, printing, and the compass started in China and was later dispersed throughout Europe. These inventions changed China as much as they changed Europe. These inventions also caused a gap between China and Europe. By the late eighteenth century, industrial revolution first started its spread from Europe.The transformations within Europe began to further accelerate while China was falling behind. In Europe, economic transformation was accompanied by social transformation. The social and demographic changes that were taking place, created the pressure for political change as well. Europe was expanding both demographically and economically, which strengthening their power in the global order. Conversely, China constrained itself from the outside world and focus on internal progresses ranging from agriculture to social classes. Why were industries in China more labor-intensive than those in Europe? In addition to its diverse geography and the belief of being self-sufficient, China struggled to transition to experiment-cum-science-based invention as well as rejecting the opportunity to create bonds and capital markets with other nations.

Moreover, after setting up economic institutions and an industrial base, Deng Xiaoping established various Special Economic Zones in China that allowed for increased foreign investment, helping to develop China’s commercial growth. As described before, when Deng Xiaoping came to power, his goal was for China to fulfill the Four Modernizations: modernization in agriculture; industry; science and technology; and defense. Deng believed that the only way China could keep up with Western countries was if China achieved the Four Modernizations. Specifically, in order to achieve the Four Modernizations, Deng had to fulfill a two-step goal. The first stage was to build up economic institutions and to set up a strong industrial base, both of which had been denied to China during Mao’s Cultural Revolution. The second stage of the Four Modernizations was China’s emergence from isolation and integration into the global economy, both of which were crucial for China’s commercial economy to develop. Deng Xiaoping’s biggest accomplishment was his achievement of this second goal. Specifically, the period of time when Deng reformed and opened up China to the world is known as 改革开放, which is pronounced Gaige Kaifang. What separated Deng Xiaoping from other leaders in the past was that Deng’s method of thinking was very pragmatic. He recognized Mao as a hero to modern China, but also believed that some of Mao’s policies were wrong. Deng’s famous quote was: “黑猫白猫抓住老鼠就是好猫,” which translates to

There have been recent concerns about the United States’ involvement with China’s economic rise. A concern about China’s growth surpassing the United States in economic size within the decade and regulating purchases of power. China’s economy grew in 1979 upon opening to foreign trade, investment and a free market. The increase of China's economy caused the gross domestic product to grow in 2016 by ten percent. China soon had the lead in being the largest economic manufacture, merchandise exporter and importer and holder of foreign exchange reserves. Their control as one of the largest economies encouraged the United States to have commercial ties with them. China's huge influence made it the United States’ second largest trading partner,

As a functionalist (pg. 411), I believe in societal dysfunctions. A dysfunction of the economy is recession and depression. There is no way to prevent these dysfunctions from happening. Stock market crashes and slowdowns happen all the time in every society across the world and often occur in cycles. Even though China has a socialist government that regulates the economy, even it obviously couldn’t prevent a nation-wide recession.

Over the course of the Communist Party’s ruling history, the economy has fluctuated in its quality. From Mao Zedong’s reign (1949-1978), Chairman Mao focused on the industrialization of communes and agriculture. The economy not only remained relatively stagnant as a result, but also caused an immense famine throughout these communes. Since Mao’s death in 1976, the Communist Party has steered away from its communal form of economy and became the world’s second largest economy through capitalism. This act of change depicts how the Communist Party has influenced the People’s Republic of China’s financial system into becoming increasingly capitalistic. The People’s Republic of China had issued a multitude of economic reforms in 1978 after the death of Mao Zedong. As a result, China has risen in the ranks of the world’s economy, effectively becoming the second fastest growing economy in the world as well. All in all, the Communist Party of the People’s Republic of China has aided the Chinese economy to reach its current success.

China had a GDP per capita level similar to Zambia, less than half of the Asian average and was lower than two-thirds of the African average at the outset of the reforms in 1978 (Eckart, 2016). China was poor. Since then, China has grown exponentially experiencing nearly 10% GDP grown per year until 2014 raising GDP from 155 current US Dollars in 1978 to 7,590 US Dollars in 2014 (Eckart, 2016). China, who accounts for 18% of the world’s population, was able to lift 800 million people out of poverty and growth in the middle class. This document will examine China’s financial and currency markets.