CHINA'S INDUSTRIAL CHANGE

How Did China's Industrial Sector Change over the Last 5 Years?

How Did China's Industrial Sector Change over the Last 5 Years?

Introduction

China is emerging as world's biggest economy. Analysts are predicting that in 2040, Chinese economy can beat American economy, due to the fact that the Chinese economy can reach 124 trillion US$. China will definitely on the peak of its economic growth and still it is striving to achieve growth targets.

Main Exports of China

The major exports of the best export Chinese products are actually for travel and equipment machinery, including computers and cell phones, around 47% of the total export volume price. Some of the best items include clothing, textiles, iron and steel, and optical and medical equipment. Food (3%), chemicals (5%) and minerals and supplies of fuel (2%) are also important export commodities.

Imports from China

While China is a net exporter, there are over 921 imported $ 500 million worth of products in 2010. The main imports are electrical components, equipment and vehicles used by approximately 43% of total imports. Petroleum and fuel, equipment, power generation, minerals, optical and medical equipment, plastics, chemicals, and the cars are all in the top group of imports.

China's Imports and Exports

Over the past 20 years, China's increasing integration with the global economy has resulted in a faster growth in its exports as compared to the corresponding growth in world exports. China's export basket has diversified from an initial array of textiles and light manufactured goods to a wider spectrum that includes more sophisticated electronic goods and data processing equipment. Statistical indicators of dispersion indicate a significant increase in product diversification between 1994 and 2000 and some reversal during 2000-02. The higher technology content of China's traditional exports during 1994 to 2001 has also been highlighted by Xu (2006), thus confirming a diversification in its export profile.

Export competitiveness and diversification are important determinants of successful integration of a country in the rapidly globalising world economy. A high degree of their achievement reflects relative cost advantages, superior product attributes and fewer trade restrictions. The determinants include price-related factors as well as qualitative attributes. The price-related factors include lower domestic wages or material costs, availability of labour, a favourable exchange rate, larger foreign direct investment (FDI) and management, and reduced cost of communication and transportation. In addition, superior quality and product design are also believed to influence the international competitiveness of a country.

Competitiveness and diversification of a country's exports are generally evaluated by using various measures based on the growth rates of a country's exports of various categories as well as their shares in global exports. For instance, a relatively rapid growth of a country's exports vis-à-vis other countries or a rise in positive trade balance implies export competitiveness. Export diversification into non-traditional manufactured goods is desirable since international prices of primary goods and agricultural products are quite volatile and the relatively low-price periods may reduce the welfare of a country which depends heavily on such ...