China's Economic Geography Is Changing - Assignment Example

Task Chinas economic geography is changing. The transition to a market economy: With the changing economic condition, increasing export volume, development in the field of science and technology China is now considered as the superpower of not only Asia but also of the world. In the last 30 years, China has evolved drastically and become the force to consider with in every aspect. In this process of transformation the government of China and its role in the reforming of the economy of the country plays and crucial role. The development of market economy in China can be categorized in two distinct phases. One is pre-reform period before1978 and other one is post 1978 period. During pre-reform period in China, there was an “autarchic socialist command economy system based on the Soviet model, with a strong focus on government directed resource allocation, development of heavy industry, large state-run enterprise and price controls”. (Kong, McKissack & Zhang).The economic growth in the country was started under the leadership of Deng Xiaoping. Implementation of decentralization was the key movement in the reformation of the market in China. The reforms change the structure of the economy drastically. In 1978 it was a poor country with per capita GDP was lower than even that of India and 3% of that of the USA in 1978. But after the government intervention and reformation, the economy started to grow lips and bounce with an annual average growth rate of 10% in GDP. The size of the market was doubling in size in every 8 years and now it is 22 times larger than that of 1978. Started with labor productivity and up to export and FDI-in all segments there was a significant growth in all aspects of Chinese economy. Not only in economic perspective but also from infrastructure and political aspects China has changed over the last two decades. From 1978 to 2000 the GDP of the country has increased on an average 9.3% every year. As a matter of fact China has adopted a step by step process to incorporate the transition in their economy. The process was started from the rural areas and gradually the changes incorporated in the urban, semi urban and in metros. The process was initiated in the year 1979 in the provinces of Anhui and Sichuan. Some villages of those provinces had adopted a pilot household project. It was a responsibility system which “linked farmers income to their output, rather than giving them equal salaries.” (BeijingTime). The process was a successful one and soon many other villages started to follow the same route. Successful implementation of the rural reform not only increased the income of the farmers but at the same time also increased the possibility of reforms among the cities across the country. The government of China first loosens the control over the grain price in the year of 1979. Prior to that government not only used to control the price of all the commodities but at the same time also used to control the labour cost as well. But from 1985 government started to deregulate the price of all commodities. In the year 1992, “the number of categories of government-priced commodities was slashed to 89 from 737, which marked the formation of a market-based pricing system in China. This progressive approach also helped China push ahead with an in-depth ownership reform.” (Beijing Time) In 1992, China secures the goal of founding a market-orientated economy. The change was a normal consequence of the ever-deepening reorganizations as goods and labour values were unrestricted up and the wealth, real estate and knowledge markets took shape. At present the market mechanism is playing a fundamental role in the economic life of China Reallocation of Labor: Reallocation of labor is closely associated with the reforms of the economy in China. At the initial stage the wages as well as prices of the commodities were controlled by the government in China. But in order to smooth transition of economy the government started to deregulate the operation and the prices of the commodities as well as wages of the labor both became deregulated. One must also consider the fact that the deregulation of the economy as well as the growth in last 30 years was also helped by the growth of the working age population in the country. From 1978 to 2011 the working age population in the country has increased from 550million to 990 million which helps to drive the industrialization process. Increasing working community also helped the community to save a larger proportion of money for the children and older generation and therefore the opportunity to invest in various financial companies also increased. This directly helped the financial and economic growth. (Veasna, McKissack & Zhang) Likewise, the decline in the young age dependency ratio is also likely to have assisted in improving human capital, as fewer child dependents allows for greater investment in each child (Bloom, Canning and Sevilla) Increasing Trade Volume: With the increasing availability of the working group the production of various agricultural and industrial products in China has also increased drastically from 1979 onwards. As per their ‘Opening Up’ policy the country started to increase the trade volume with various other nations of the world which in turn boost their economy. The export volume of China was on a steady growth rate in last 30 years and from in last 15 years, after the accession to the WTO in 2001 the export volume increased almost ten times. The growth rate in the nominal merchandise exports from 2002 to 2008 was doubles that of the 1990s only. As a result China is now the largest exporting country of the world crossing both the USA and Germany and responsible for over 10% of total export in the world. (Coates, Horton and McNamee) Growth related to investment: High volume of investment is another striking characteristic of the transformation in the Chinese economy. China began the restructuring period with comparatively low volume of capital, and was mainly dependent on large volume of returns of investment (ROI). Kuijis and Wang in their reviews mentioned that “growth in the capital stock, which has averaged 10 per cent per year between 1978 and 2004, has contributed more than half of GDP growth. Between 1993 and 2004, the contribution of capital accumulation to GDP growth is estimated to have been even higher at 62 per cent.” (Kuijis and Wang) At the initial phase of transformation investment was around 28% of the GDP but as the time moves on the contribution started to increase drastically. During 2001 to 2010 the percentage of investment or the capital formation was close to 40% of GDP and in 2011 the same was 46%. The volume was far higher than the previous highest recorded in various other nations such as n Japan (37 per cent, 1973), South Korea (38 per cent, 1991) and Thailand (42 per cent, 1991) Government policy reformation, large volume of savings, available workforce, well planned industrial reform all plays a key role in making the economy one of the strongest in the world. (Hubbard, Hurley and Sharma) on the basis of above economic reform the country is setting a new target for itself for the year of 2013-2014. During the financial year to stabilize the economic transition China has set a target of GDP growth of 7.5%; CPI or consumer price index control target of 3.5%; money supply growth of 13% and fiscal deficit of 2% of GDP (Xianrong). The target set by the government is at par with the last financial year’s business performance which in turn can stabilize the economy of the country. Moreover, with this stable growth rate China as a country can combat the world economic crisis more effectively than other superpowers of the globe. Task 2 Why China Focusing on developing Infrastructure: China is one of the leading countries in the world and also a large economic superpower. Over the year China as a nation improved drastically in Politics, economy, sociology and infrastructure. At present China is being considered as the leading nation in terms of infrastructure development. From the very beginning the country is keen on developing its infrastructure. Developing infrastructure is the key in order to achieve sustainable economic success. They want to develop the infrastructure to ensure stable domestic growth and more foreign investment. Over the year Chinese industry is investing large amount of money to ensure faster R & D in every segment and at the same time government is also investing on developing the infrastructure so that people of the country can reach to various parts of the nation to get access to all those development. “A $207 billion investment to head off future traffic jams In the past decade alone, China has built 31,000 miles of expressways. Thats about two-thirds the length of the entire U.S. Interstate Highway System, constructed at great cost since it was founded some 60 years ago. Today China boasts 49,000 miles of expressways -- and some 2.6 million miles of roads, more than double the amount in 2002.” (VanderMey) Over the year various industries have grown drastically in China. As on 2012, there were 710500 number of employee associated with various industries and leadership of those companies have mentioned that developed transportation is must for smooth communication and transfer of raw materials and finished goods. To support this government has invested a large amount in development of railways, airport, surface and water transport. Railways are generally used to ensure communication between rural and urban areas. As there are comparative less amount of water available in the country so the nation has to concentrate more on surface and air transport. This development of infrastructure is important to keep the pace with industrial development. In 2012, Chinese President in his speech has clearly mentioned that infrastructure development will help the country to fight against economic crisis in the future. “Chinas economic planning body, the National Development and Reform Commission (NDRC), has approved 60 infrastructure projects worth more than $150 billion. The news boosted asset prices from steel futures to stocks, especially of companies related to construction. To strengthen infrastructure development is key to promoting recovery and achieving sustained and stable growth and Governments should play an important role in infrastructure building and step up financial support for infrastructure development.” (Busvine & Ruwitch). Task 3 What geographical factor makes China’s Environment so Variable? One of the key factors associated with the development of any country is the geographical location. China is the leading country in the Asia in terms of economic development. Over the year with the continuous development in the field of economy, industry China as a nation is now at the top of its growth rate. But the growth of the country in economy as well as civil power hasn’t comes for free. The natural resources in the country such as forests, land, rivers and air quality are anguish intensely as industrial unit contaminate and cars turn out to be every familys achievable dream in modern era. China is the worlds most populous country and has had the worlds fastest-growing economy for almost three decades, with a Gross Domestic Product (GDP) that increased 12-fold between 1978 and 2005. While these economic gains have improved the daily lives of millions, the cost, in terms of the environment, is enormous and potentially catastrophic. Chinas environment is already among the worst of any major country. Air pollution, diminishing biodiversity, fisheries depletion, invasive species, land degradation, soil erosion, and water pollution and shortages all continue to be major problems. For China there are several environmental obstacle for them in place –they have invented number of solutions for that also but in some cases those are not properly implemented. The obstacles are: Environmental protection agencies lack sufficient authority, financial resources and manpower. When there are conflicts between environmental protection and economic development, the former often loses to the latter. In the past, economic performance has overshadowed environmental protection as a criterion for selection and promotion of government officials. There is very low environmental awareness among the people in the country. As a matter of fact according to their view environmental awareness or protection harm the economic growth but often they overlooked the problem caused by their less awareness. Many technologies used by them are highly polluting but there are no alterations in place. (PBS). All these pollutions have severe results. As per the study “air pollution contributed to 1.2 million premature deaths in China in 2010. Epidemiological studies conducted since the 1980s in northern China suggest that urban air in China causes significant health complications, including respiratory, cardiovascular, and cerebrovascular diseases. The pollution has also been linked to the proliferation of acute and chronic diseases; estimates suggest that around 11 percent of digestive system cancers in China may stem from unsafe drinking water.” (Xu). Another key problem associated with the environmental problem is the emission of greenhouse gas. In China the “greenhouse-gas emissions were about 10% of the world’s total in 1990. Now they are nearer 30%. Since 2000 China alone has accounted for two-thirds of the global growth in carbon-dioxide emission.” (The Economist). Due to excess emission of greenhouse gas and carbon-di oxide the wildlife of the country is also under threat and therefore the ecology is being affected drastically. The worst problem associated with the environmental pollution is water. Most of the Northern part is dry now. In China four-fifth of the total water is in the southern part but astonishingly half of the people and 2/3rd of the total farming land are on the northern part. Energy consumption by use of coal is another point of concern for the country. “China’s consumption of energy per unit of GDP tripled in 1950-78—an unprecedented “achievement”. In the early 1990s, at the start of its period of greatest growth, China was still using 800 tons of coal equivalent (tce, a unit of energy) to produce $1m of output, far more than other developing countries” (The Economist). China now burns about half the world’s provisions. In 2006 it exceeded America in carbon-dioxide emanations from energy and by the end of 2014-2015 it will start emitting two times what USA used to emit. Task 4 Flood in China due to Levee Build up and Break: As a country the geography of China is very diverse. There are large amount of land place in the country mainly in the northern part where as in the southern part there are some water parts. Generally flood is almost a yearly event in China and almost every year hundred and thousands of people lose their life in flood. In China the alluvial plain is the key term associated with the flood. It is a form of erosional plain which is developed in the earth surface due to water movement. Generally the “Erosional plains are likely to develop on landscapes that are relatively flat with low height elevations and shallow depressions. Some plains may develop below sea level but not higher than the surrounding region; this is a result of endogenetic factors and diastrophic movements.” (Baugh) The Alluvial plain: The alluvial plain generally develops from water current. Generally this structure developed due to weathering of the water current in the river. While coming down from the high hill areas the rivers generally brings in large volume of landmasses and store the same in the comparatively lower areas. By accumulating large volume of landmasses it generally forms low relief plains known as alluvial plains. “An alluvial plain is characterized by its relatively flat and gently sloping landform and is normally formed at the base of a range of hills. Continuous fluvial weathering of these hills is what causes sediments to move and spread across lower levels to produce this type of plain.” (Baugh) In China the flood generally took place due to collapse of these plains in various parts. Generally water bodies bounded inside these plains over a long period of time. And when the volume of rainfall increases these surrounding crashed down resulted into flood. For example, “in the year of 1998, waterlogged levees along Chinas flood-swollen Yangtze River have reportedly started to collapse, causing death and destruction on a large scale.” (Relief web) The same incident again repeated in the year of 2010. This river is the longest in Asia and originated from 5000 meters above of sea level in Plateau of Tibet and finally empties into its major delta system on the East China Sea. The major sections affected by the flood are the lower course areas “downstream of the Three Gorges Dam, an area in which the river flows through low-lying terrain dotted by lakes, marshes, and meandering streams” (Encyclopedia Britannica) In order to allow places for civilization government has to restrict the flow of the river by developing various barriers. In recent years there are only 4 gateways by which it can reach up to East China Sea. As a result huge amount of sediment started too deposited on the river bottom and as a result various low lands were developed in the north bank. With increasing pressure of rain those soft boundaries collapsed resultant into heavy flood in nearby areas. Generally this type of flood are periodical as it takes some times to develop such structure and increase the water level beyond the limit to cause the flood. But when it takes place the amount of destruction is absolutely huge. Like in 1931 the flood covered over 77000 sq. km, killed over 300000 people and made 40000000 homeless. In 2008, the overflow affected 28 provinces and cities with 240 million people. Almost 14 million people lost their home and 65 million acres of crops were washed away. (The Boston Globe). Task5 Why Population is increasing after one child policy implementation. In Asia China is considered as the powerhouse in terms of economy and politically. Over the year China as a country developed in every aspect lips and bounds. As a nation China is being considered as one of the most dominating power in the world. But the policy has been change drastically with a due course of time. In order to control the rate of [population Chinese government was started to implement the one child policy to ensure that the number of population remain in check. But there are certain problems associated with it. After the implementation of the policy associated with one children of every couple there is a new problem and that is too slow birth rate. As a matter of fact there was a dawdling progress rate connected with the general public in the country. As a matter of fact number of people exceeding the age of 60 now exemplifies 13.3% of the total population, and the figure is increased up from 10.3% in 2000. During the same period of time, those below the age of 14 dropped from 23% to 17%. (The Economist) In order to control the increasing population the Chinese government has introduced one-child policy but still the population in the country is increasing sharply. The main objective of the policy was to keep the total population of the country within 1.2billion by the end of 2000 but after 2000, the population was 1.26billion-an increase of 60million people from the target. In order to control the growth of the population as well as to increase the GDP per person value Chinese government has introduced one child policy. If one compares the figure of 1970 and 1980, the fertility rate in the country had already been fallen from 5.8 births per women in 1970 to 2.8 in 1980. As a matter of fact the main objective associated with the one child policy was “o increase GDP per capita — and Chinas GDP grew much more quickly than the pessimistic predictions in 1980 had expected.” (Anders) The implementation of the one child policy was different in different places and that was the main reason why the population was not decreasing over the years. “The policy was implemented differently in different regions, and there were a ton of loopholes, depending on where you lived. In some places, you could have more than one child if you were a fisherman. In others, you could have more than one child if your first child was a girl” (Anders) Due to these kinds of relaxation in the policy the population is continuously increasing in the country. The rate of growth although slowed down but the number is not coming down as there was a large scale of people already in the country. In recent years this one child policy has confronted with high degree of resistance in various rural areas and among families who have the desire of male children. There are some critical problems associated with it. The trend suggested the fact that the China’s population will reach a great high in 2026 and by that time the labour force will reduce drastically and people above 65 years will dominate the whole population. In some cities sex selective abortion is also responsible for abnormal male female ration. In rural areas the abortion is not available so the1 child policy was not so much strictly followed. In modern times the ration between male and female is 120:100. As per the report “Its estimated that the percentage of men in their late 30s who have never married will quintuple by 2030, and this large number of unmarriageable young men cannot help the country.” (World Population Review). Reference Anders J Charlie. Did China’s one child policy actually reduce population growth? 2014. Web. June 5, 2014 from http://io9.com/did-chinas-one-child-policy-actually-reduce-population-1511784972 Baugh Claudine. About the Erosional Plains. Bright Hub. 2011. Web. June 5, 2014 from at http://www.brighthub.com/environment/science-environmental/articles/112205.aspx Bloom, E. David, Canning, David, Sevilla, Jaypee. Economic Growth and the Demographic Transition, National Bureau of Economic Research, 2001, Web. June 5, 2014 from http://www.nber.org/papers/w8685 Busvine, Douglas & Ruwitch, John. Chinas president says infrastructure development key to recovery. Reuters. 2012. Web. June 5, 2014 from http://in.reuters.com/article/2012/09/08/china-economy-infrastructure-idINDEE88703V20120908 Chinas Economic Transition, a Great Success. Beijing Times. Web. June 5, 2014 from http://english.peopledaily.com.cn/200211/13/eng20021113_106760.shtml China Flood: August 1998. The Boston Globe. 1998. Web. 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Chinas Pattern of Growth: Moving to Sustainability and Reducing Inequality, The World Bank, Policy research paper. 2005.available at https://openknowledge.worldbank.org/bitstream/handle/10986/8496/wps3767.pdf?sequence=1 The Economist. China and the environment: The East is grey. 2013. Web; June 5, 2014 from http://www.economist.com/news/briefing/21583245-china-worlds-worst-polluter-largest-investor-green-energy-its-rise-will-haveaccessed on 5.6.2014 VanderMey, Anne. Chinas new infrastructure. Fortune. 2014. Web; June 5, 2014 from http://fortune.com/2013/05/23/chinas-new-infrastructure/ World Population review: China. 2014. Web; June 5, 2014 from http://worldpopulationreview.com/countries/china-population/ Xianrong, Yi. China’s Stable Economic Transition in 2013. China US Focus. 2013. Web; June 5, 2014 from http://www.chinausfocus.com/finance-economy/chinas-stable-economic-transition-in-2013/ Xu Beina. China’s Environmental crisis. Council on foreign Relation: Backgrounders. Web. June 5, 2014 from http://www.cfr.org/china/chinas-environmental-crisis/p12608 Yangtze River Floods. Encyclopedia Britannica. Web. June 5, 2014 from http://www.britannica.com/EBchecked/topic/1503369/Yangtze-River-floods accessed on 5.6.2014 Yangtze levees collapse in China causing death and destruction. Relief web: Australia Broadcasting Corporation. 1998. Web. June 5, 2014 from http://reliefweb.int/report/china/yangtze-levees-collapse-china-causing-death-and-destruction Read More