If Current Trends Continue, China May Emerge as the World's Largest Economy by 2020.

1496 Words May 31st, 2014 6 Pages
1.
Discuss the possible implications of such a development for

(1) The world trading system.

(2) The world monetary system.

(3)The business strategy of today's European and U.S. based global corporations.

(4)Global commodity prices

Answer:

The world trading system would clearly be affected by such a development. Currently China enjoys a somewhat privileged status within the World Trade Organization as a ―developing country. Such a rise to eminence, however, would clearly force it to become a full and equal member, with all the rights and responsibilities. China would also be in a position to actively affect the terms of trade between many countries. On the monetary front, one would expect that China would have to have
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Literacy Rate is low: Less people are educated thus we found less skilled labors. But at present stage both skilled and unskilled labor are necessary for using good technology and production.

Raw Materials Unavailability: Raw materials are less available or unavailable. It may be gathered from distance sources that incur high expenses. Poor infrastructure for production of product & services: Due to undeveloped mode of every sector , Production infrastructure is not suitable. Markets are not available: Market for products are not available. People want low cost product because they have less sources of income. Customers are less available for good products: High quality products are costly. They are not beared by customers because their purchasing power is low. More dependent families: Less people earn and more people want to consume. It means more people are dependent upon income generating members. Lands are not suitable for agriculture: Lands are mostly barren due to poor irrigation system, mismanagement of water, unavailability of modern agriculture methods application and tools, etc. People depend upon still upon ancient irrigation system. Cheap labors are available: Labors are easily available at low costs but they are mostly unskilled. So they are useless in technical works or in high rated projects.

Poor Technological Development: Due to poor infrastructure of R&D and unskilled employees, technological innovations may not possible