Economy of the People's Republic of China

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People's Republic of China
China People's RepublicPeople's Republic of China
World economic rank 2. (nominal) (2017)
currency Renminbi (CNY)
Conversion rate 1 EUR = 7.78 CNY
(as of July 6, 2018)
Trade
organizations
WTO , APEC
Key figures
Gross domestic
product (GDP)
$ 12.054 billion (nominal) (2017)
$ 23.159 billion ( PPP ) (2017)
GDP per capita $ 8,643 (nominal) (2017)
$ 16,660 (PPP) (2017)
GDP by economic sector Agriculture : 8.2%
Industry : 39.5%
Services : 52.2% (2017)
growth   6.9% (2017)
inflation rate 1.8% (2017)
Gini index 46.5 (2016)
Employed 806.2 million (2017)
Employed persons by economic sector Agriculture : 28.3% (2016)
Industry : 29.3% (2016)
Services : 42.4% (2016)
Activity rate 68.9% (2017)
Unemployment rate 4.0% (2017)
Foreign trade
export $ 2.157 billion (2017)
Export partner USA : 18.2%
Hong Kong : 13.8%
Japan : 6.1%
South Korea : 4.5% (2017)
import $ 1,731 billion (2017)
Import partner South Korea : 10.0%
Japan : 9.2%
Taiwan : 8.8%
USA : 8.5%
Germany : 5.4% (2016)
Foreign trade balance $ 426 billion (2017)
public finances
Public debt 48.4% of GDP (2017)
Government revenue $ 2,672 billion (2017)
Government spending $ 3,146 billion (2017)
Budget balance −4.0% of GDP (2017)

The economy of the People's Republic of China has been the second largest economy in the world after the USA since 2010, or the largest economy in the world in terms of purchasing power parity since 2016 . Economically, the People's Republic of China is very dynamic and has developed into an economic and technological superpower as a result of a reform and opening policy that began in 1978 .

The country has many mineral resources , especially coal , oil , natural gas and metallic ores . The People's Republic of China is the world's largest coal producer and fourth largest oil producer. The coal reserves are the third largest in the world, the oil reserves are estimated at around 24 billion barrels . China owns 70 percent of the global reserves of rare earths and produces more than 95 percent of the world's production of these raw materials. These metals are indispensable for many high-tech products manufactured in industrialized countries, such as cell phones, hard disk drives , lasers , weapon systems and batteries for electric cars .

The economy of the People's Republic of China has become the economic reforms from a planned economy to a primarily organized according to market functioning mechanisms economic system changed. This economy , directed according to capitalist principles , is referred to by the Chinese government as " socialism with Chinese characteristics ". The dominant role of state capital has declined sharply since the late 1990s. In the past, China's strength as a production location stemmed primarily from its comparatively low wages. An advantage that has diminished due to the sharp rise in wages in recent years.

China is no longer a low-wage country . In addition to natural resources , human resources are increasingly the most important capital of the People's Republic of China. Of around 800 million workers, 28.3 percent are employed in agriculture, 29.3 percent in industry and 42.4 percent in the service sector (as of 2016) . Every year between six to seven million university graduates with highly qualified degrees in technical and natural sciences enter the labor market. No other state is currently investing more money in research and development than China.

The strengths of the Chinese economy lie in advanced production know-how and supply chain management , which is why the country is increasingly developing into an economic innovation leader and a major player in global capitalism .

development

The People's Republic of China is the second largest economy in the world with a gross domestic product (GDP) of around 14.4 billion US dollars (as of 2019). In terms of gross domestic product per capita , China is in the global midfield with around USD 10,276. In 2019, the Chinese economy grew by 6.1%.

In 2016, China was ranked 27th out of 137 countries in the Global Competitiveness Index 2017–18 of the World Economic Forum , which is mainly due to its strong export economy. China was the world's largest goods exporter with an export volume of US $ 2,098 billion in 2016. Since the economic opening of China, the country's exports have increased more than a thousandfold from 2 billion to over 2,000 billion dollars.

The service sector generated 51.6 percent of GDP in 2016, the industrial sector 39.8% and the agricultural sector 8.6%. This made China the world's largest industrial power, had the largest agricultural production and was the second largest consumer market. Of China's 900 million workforce in 2015, 28.3% were employed in agriculture, 29.3% in industry and 42.4% in the service sector.

The major stock exchanges in China are the Shanghai Stock Exchange , Hong Kong Stock Exchange and the Shenzhen Stock Exchange . Cities like Beijing, Shanghai and Shenzhen are financial centers of increasing international importance.

capital

According to a study by Bank Credit Suisse from 2017, the People's Republic of China ranked second in the world in terms of total national assets . Total real estate, stocks, and cash holdings totaled $ 29 trillion, making Chinese households nearly a tenth of the world's wealth of around $ 280 trillion. The wealth per adult person is $ 26,872 on average and $ 6,689 in median (in Germany: 203,946 and 47,091 dollars, respectively). Chinese households are thus in the middle of the field in terms of wealth per capita. Altogether, 45.4% of the Chinese people's total wealth was financial wealth and 54.6% was non-financial wealth. The Gini coefficient for wealth distribution was 78.9 in 2017, which indicates a very high level of wealth inequality. The top 10% of the Chinese population owned 71.9% of the property and the top 1% owned 47.0%. The proportion of Chinese with wealth less than $ 10,000 is estimated at 63.1% of the population and the proportion with wealth over $ 1 million is estimated at 0.2%. A total of 1.9 million Chinese were millionaires, making the country about 5% of the world's millionaires in US $. The PR China was also the country with the world's second highest number of billionaires with a total of 373. The richest man in the country was Ma Huateng with a fortune of 45.3 billion US dollars (as of 2018).

Energy industry

Shanghai , the financial center of China; 2016
Inner Mongolia coal mine ; 2005
Chinese cutting-edge technology : CPV concentrator cells on
dual- axis solar trackers in Golmud , Haixi Autonomous District , Qinghai Province ; 2014

Due to the rapid industrialization and the increase in the standard of living (quality of life), the energy demand rose sharply. In 1985 about thirteen times as much energy was used as in 1957. The per capita consumption of energy is comparatively low at about half the international average and about a tenth of the per capita consumption of the United States. Therefore, a further sharp increase in energy demand can be predicted.

The year 1990 marked the first turning point in energy supply: China became a net importer of energy. In late 1993, China also became a net importer of crude oil. In July 2010, China became the world's largest energy consumer. An important factor in the increase in energy consumption, and therefore carbon dioxide emissions, is due to China's role as "the world's workbench"; H. on the production of export goods for consumption in other countries. Between 2002 and 2008, export goods production accounted for about 48% of China's total carbon dioxide production.

In September 2016 China ratified the on the 2015 United Nations Climate Change Conference adopted climate protection agreement . This provides for global warming to be limited to 1.5 ° C if possible, but in any case below 2 ° C compared to pre-industrial values.

Coal is China's most important energy source. In 2015, the share of total Chinese energy consumption was 64.4%, although the relative share has been declining for years because coal consumption is growing less rapidly than other energy sources. In the electricity sector, the share of coal was still 83% in 2007; by 2015, with the growing share of renewable energies and nuclear energy, the share had fallen to 72%. In 2013, coal consumption in China peaked (another statistic mentions 2014), then consumption fell again, in 2014 by 2.9%, in 2015 by 3.6%. Since this decline in coal consumption was achieved despite economic growth of 7.3 or 6.9%, which decoupled growth from coal consumption, some researchers consider this decline to be a permanent turnaround in Chinese energy policy and an important step in the global climate protection efforts. With the falling fuel consumption due to the 63 TWh lower coal power production, the CO 2 emissions also decreased, in the first 4 months of 2015 by 5%. That's equivalent to the UK's total carbon dioxide production . Around 1000 coal mines were closed at the same time.

In 2016, the installed capacity was in second place with 1646  GW and in terms of annual generation in first place in the world with 6.142 trillion  kWh . In the mid-1990s, installed capacity was still 215 GW and annual generation was 994 billion kWh.

In the hydropower sector , the country has a technically exploitable capacity of 574 GW; 70% of it comes from rivers in the provinces of Sichuan , Yunnan and Tibet . Around 197 GW had been developed by the end of 2009. At the end of April 2010, 67 GW of new power plants were under construction, the largest of which is a project on Brahmaputra in Tibet. The world's largest hydroelectric power station is the Three Gorges Dam . In 2016, hydropower plants with an installed capacity of 331.11 GW were in operation in the People's Republic ; of which 26.72 GW were pumped storage power plants . The annual production of the hydropower plants was 1.18 trillion kWh in the same year  . The installed capacity of hydropower plants in China represented more than a quarter of the global hydropower plant capacity in 2016. The share of hydropower plants in the installed capacity of all power plants in the People's Republic was 20.2% in 2016. In total there are several hundred hydropower plants in China .

China has been relying heavily on renewable energies since around 2006 . In 2013, renewable energies ( hydropower plants , wind turbines , photovoltaic systems , etc.) covered around 20.4% of China's electricity demand. In the same year, China invested more in renewable energies than in coal-fired power plants for the first time and added more than 12 GW of photovoltaic capacity - more than any country has ever invested in this sector. China has thus doubled its photovoltaic capacities and plans to add another 14 GW per year. A total of around 57 GW of regenerative generation capacity was installed in China in 2013 (for comparison: coal: 39.7 GW).

In 2014, electricity production from renewable energies rose sharply. Compared to the previous year, around 242 TWh more green electricity was produced, primarily from hydropower . Overall, the Chinese electricity consumption is around 6000 TWh, which is about 10 times the German electricity generation. The Chinese government is strongly promoting the expansion of photovoltaics. The Chinese National Energy Agency recently increased its expansion targets by 30% and in 2015 overtook Germany as the largest installer of photovoltaics both in total (21.3 GW) and per capita of the population of newly installed capacity (16.3 W). By 2030, renewable energies should cover around 20% of the total primary energy demand.

In the wind power China is leading the world. At the end of 2017, wind turbines with a total of 188.2 GW were installed, putting China clearly ahead of the USA with 89.1 GW and Germany with 56.1 GW. Measured in terms of output, around one in three wind turbines worldwide is in China. By 2030, the proportion of wind power is to be tripled to fivefold. As of 2016, wind energy is the third most important supplier of electricity after coal-fired electricity and hydropower.

China is also the world market leader in the solar thermal sector . In 2012, 63,900,000 m² of solar thermal collector surface were newly installed in China alone , the lion's share of the 72,913,000 m² that were put into operation worldwide this year. For comparison: in Europe around 14 million m² were installed in 2004, in China around 64 million m². A total installed collector area of ​​270 million m² is forecast in China by 2020.

There are several nuclear power plants in the People's Republic of China . The first Chinese nuclear power plant is located in Qinshan ( Zhejiang Province ) and has been on the grid since 1991. As of March 2014, 21 reactor units with a nominal output of 16.9 GW were in operation. 28 further power plant blocks with an output of 27.7 GW were under construction, and further power plants are planned. In 2013 nuclear power plants supplied 110.7 TWh of electrical energy. Nuclear power plants thus contributed 2.11% to China's total electricity generation.

Characteristics

Development of China's gross domestic product in renminbi and US dollars
year 1952 1956 1960 1964 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 2008 2010 2011 2012 2013 2014 2015 2016
GDP in billion Rmb 119 103 146 145 172 252 294 452 717 1,493 2,664 6,789 8,947 15,988 31,404 40,070 48,603 54,098 59,696 64,718 69,910 74,539
GDP in Rmb per inhabitant 119 165 218 208 222 292 316 460 692 1,355 2,287 5,576 7,858 12,336 24.091 30,629 36,073 39,953 43,871 47,314 50,858 53,908
GDP in billion US $ 59 59 70 113 153 305 316 411 495 867 1,214 1,966 4,604 6,066 7,522 8,570 9,635 10,534 11,226 11,218
GDP in dollars per inhabitant 89 85 91 131 165 309 303 371 423 708 958 1,512 3,467 4,524 5,582 6.329 7,080 7,701 8,166 8,133
Source: Official statistics of the PR China China, 2016 (note on the table see below) and IMF World Economic Outlook

Note:
This table was drawn up using the official figures. It should be noted that, according to the Chinese method of calculation, only commercially provided services by industry and craft are included in the GDP indicator. Services, rural barter transactions and self-consumption are not included in GDP. Therefore, in this table, GDP in 1960, the worst famine year of the big jump, is a third higher than in 1956, a year with a good harvest and some prosperity.

The following two tables show the development of steel and cement production, the two basic materials of construction. In 2013, 48% of world steel production and over 55% of world cement production was produced in China.

China's steel production in millions of tons
year 1950 1955 1970 1980 1990 1995 1999 2002 2005 2007 2008 2009 2010 2011 2012 2013 2015
in million tons 0.6 4.0 18.8 37.1 66.3 95.4 124 182 349 489 501 568 627 683 717 822 804
Source: Official Statistics of the PRC
China's cement production in millions of tons
year 1950 1952 1957 1970 1980 1990 2000 2005 2007 2009 2011 2013 2014
in million tons 1.4 2.9 6.9 10.0 79.9 209.7 583.4 1069 1361 1644 2099 2400 2500
Source: USGS, 2013

The following tables show the development of the gross domestic product, the investment rate, inflation and automobile production.

Annual growth of China's gross domestic product in%
year 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Growth in% 9.3 7.8 7.6 8.4 8.3 9.1 10.0 10.1 10.4 11.6 13.0 9.6 9.2 10.5 9.2 7.8 8.4 7.7 7.4 6.7 6.9
Source: Official Statistics of the PRC
Inflation in percent compared to previous year
year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Inflation rate in% −1.3 0.4 −0.8 1.2 3.9 1.8 4.1 4.8 5.9 −0.7
Source: Official statistics of the PRC Source: bfai, exxun and BIS
Automobile production in millions of cars + trucks
year 1999 2002 2005 2007 2008 2009 2010 2011 2013 2015 2017
Automobile production 1.8 3.3 5.7 8.9 9.3 13.8 18.3 18.4 21st 24.5 28.9
Source: Official Statistics of the PRC
Investment rate (*) as a percentage of GDP
year 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Investment rate in% 32 33 33 34 34 35 37 38 43 41 40 41 45
Source: Official Statistics of the PRC Note on the table see below

(*) Note on the investment rate: In China currently (2006) over 40% of economic output is directly reinvested in new systems and less than 60%, be it by the state or through private consumption, is used for consumption, but are included in these statistics only commercially provided services from industry and craft. Services, rural barter transactions and personal consumption are not included in GDP and are therefore not included in the investment rate.

Ranking world market

A comparison of the available data shows that China has now not only occupied top positions in many production sectors, but has often already assumed an undisputed leadership position. China is the largest grain producer in the world. In addition to wheat, maize (21% of the arable land) and above all rice (32% of the arable land) are grown. The rare earth China has a funding share of over 90%. The following table is intended to illustrate China's top positions using many examples from the fields of agriculture , mining , industry and the energy sector (clicking on the products takes you to the detailed tables in many cases):

China's rank in world production
product class
Rank
CN
Rank
USA
Rank
DE
production year
Grain LW 1 2 13 583.7 million t 2016
wheat LW 1 3 9 131.7 million t 2016
rice LW 1 11 - 209.5 million t 2016
Corn LW 2 1 29 231.7 million t 2016
Bananas LW 2 - - 10.7 million t 2011
Apples LW 1 2 14th 44.4 million t 2016
Oranges LW 3 2 - 6.5 million t 2012
Lemons LW 3 6th - 13.1 million t 2011
grapes LW 1 3 16 13.4 million t 2018
Potatoes LW 1 5 6th 99.0 million t 2016
sugar LW 3 5 - 14.0 million t 2012
(Cow) milk LW 3 1 5 36.8 million t 2016
cheese LW - 1 2 - 2011
butter LW - 3 5 -
Cattle LW 3 4th - 41.0 million 2010
beef LW 4th 1 - 5.6 million t 2010
Pigs (herd) LW 1 3 5 489 million 2005
pork meat LW 1 2 3 50.2 million t 2011
Soybeans LW 5 1 - 12.0 million t 2016
Sheep (stock) LW 1 - - 136.4 million 2008
Sheep meat LW 1 7th - 2.1 million t 2012
Chicken LW 2 1 - 15.0 million t 2007
flesh LW 1 2 4th 72.64 million t 2004
Fish (catches) LW 1 5 - 81.50 million t 2016
Wool (unwashed) LW 2 - - 0.52 million t 2004
cotton LW 1 3 - 6.8 million t 2012
rubber LW 5 - - 0.55 million t 2005
Wood LW 3 1 13 286.1 million 2003
Gold mining BB 1 4th - 453 t 2017
Silver mining BB 3 8th - 2380 t 2017
Platinum mining BB - 5 - - 2016
Artificial diamond production BB 1 - - 14.6 billion carats 2019
Copper extraction BB 3 4th - 1.86 million t 2017
zinc BB 1 4th - 5.1 million t 2017
tin BB 1 - - 100 million tons 2017
lead BB 1 3 - 2.40 million t 2016
bauxite BB 2 - - 55 million t 2014
Iron ore mining BB 1 8th - 1200 million tons 2016
iron I. 1 8th 7th 701 million tons 2016
steel I. 1 4th 7th 832 million tons 2017
aluminum I. 1 5 13 31.0 million t 2016
cement I. 1 3 17th 1,354 million tons 2007
Man-made fibers I. 1 3 9 7.9 million t 2001
Paper and cardboard I. 1 2 4th 99.3 million t 2011
fertilizer I. 1 3 14th 23.6 million t 2002
Uranium extraction E. 8th 9 - 1616 t 2016
Hard coal mining E. 1 3 21st 3103 million tons 2016
Lignite mining E. 2 4th 1 140 million tons 2016
Oil production E. 7th 3 56 200 million tons 2016
Power generation E. 1 2 26th 92.0 square Btu 2014
Power generation E. 1 2 7th 6143 billion kWh 2016

Remarks:

  1. LW = agriculture , BB = mining , I = industry , E = energy
  2. Year for which comparative figures were available
  3. on cellulose and synthetic basis

Foreign trade

The tables below show China's main trading partners and major commodities. There are now around 7,000 German companies represented in China.

Development of foreign trade

Development of foreign trade (GTAI) in billion US dollars and its year-on-year change in percent
2014 2015 2016
Billion USD % yoy Billion USD % yoy Billion USD % year-on-year
import 1,958.0 +0.4 1,681.7 −14.1 1,588.7 −5.5
export 2,342.3 +6.0 2,281.9 −2.6 2,119.0 −7.1
balance +384.3 +600.2 +530.3
Export (2016)
Trading partner Proportion of %
United StatesUnited States United States 18.3
Hong KongHong Kong Hong Kong 13.8
JapanJapan Japan 6.1
Korea SouthSouth Korea South Korea 4.5
GermanyGermany Germany 3.1
VietnamVietnam Vietnam 2.9
IndiaIndia India 2.8
other countries 48.5
Import (2016)
Trading partner Proportion of %
Korea SouthSouth Korea South Korea 10.0
JapanJapan Japan 9.2
TaiwanRepublic of China (Taiwan) Taiwan 8.8
United StatesUnited States United States 8.5
GermanyGermany Germany 5.4
AustraliaAustralia Australia 4.4
MalaysiaMalaysia Malaysia 3.1
other countries 50.6
Export goods (2016)
Export goods Proportion of %
electronics 25.6
textiles 12.5
Electrical engineering 8.4
machinery 8.3
Metal goods 3.8
Others 41.4
Import goods (2016)
Import goods Proportion of %
electronics 23.3
raw materials 12.7
oil 7.3
machinery 6.8
Electrical engineering 5.3
Others 44.6
The main oil suppliers to the People's Republic of China in 2014
rank country Barrel per day Percentage
1. Saudi ArabiaSaudi Arabia Saudi Arabia 997,000 16.1%
2. AngolaAngola Angola 816,000 13.2%
3. RussiaRussia Russia 665,000 10.7%
4th OmanOman Oman 597,000 9.6%
5. IraqIraq Iraq 573,000 9.3%
6th IranIran Iran 551,000 8.9%
7th VenezuelaVenezuela Venezuela 277,000 4.5%
8th. United Arab EmiratesUnited Arab Emirates United Arab Emirates 234,000 3.8%
9. KuwaitKuwait Kuwait 213,000 3.4%
10. ColombiaColombia Colombia 199,000 3.2%
Others 1,069,000 17.3%
total 6,191,000 100%

See also

literature

  • Tobias ten Brink: China's Capitalism. Origin, course, paradoxes. Campus-Verlag, 2013, ISBN 978-3-593-39880-8 .
  • Barbara Darimont (ed.): Economic Policy of the People's Republic of China. Springer Gabler, 2020, ISBN 978-3-658-28304-9 .
  • Wolfgang Hirn: Shenzhen. The global economy of tomorrow. Campus-Verlag, 2020, ISBN 978-3-593-51192-4 .
  • Richard Hoffmann: Practical Guide "Business in China". First-hand insider knowledge. Springer-Verlag, 2013, ISBN 978-3-658-02493-2 .
  • Elena Kronester, Anabel Ternes: Human Resources Management and Leadership in China. Status quo and challenges. Academic Publishing Association Munich, 2017, ISBN 978-3-96091-519-5 .
  • Sven Woogt: The change from a labor-intensive to a capital-intensive economy in China. Igel Verlag, 2009, ISBN 978-3-86815-172-5 .

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