Economy of China

Group-01 (B2)

2012
By Group No. 01 Under the guidance of Mr. Paresh Dave S.R.Luthra Institute of Management

Rana Piush (087), Rana Kishan (086), Pansuriya Kiran (063), Mepani Bhavesh (132), Sharma Nitin (102), Parmar Mahavir (064).

1) Basic Information about China

China officially the People's Republic of China (PRC), is the largest country in East Asia. It is the world's most populous country, with a population of over 1.3 billion. Covering approximately 9.6 million square kilometers, the country is the world's second- largest country by land area, and the third- or fourth-largest by total area, depending on the definition of total area. The People's Republic of China is a single-party state governed by the Communist Party of China. Capital President: :- Beijing (Peking) Hu Jintao Premier: Wen Jiabao

Curre ncy: -

Renminbi (Yuan) ()

Central bank: - The Peoples Bank of China China's landscape is vast and diverse, with forest steppes and the Gobi and Taklamakan deserts occupying the arid north and northwest near Mongolia and Central Asia, and subtropical forests being prevalent in the wetter south near Southeast Asia. The terrain of western China is rugged and elevated, with the Himalaya, Karakoram, Pamir and Tian Shan mountain ranges separating China from South and Central Asia. In 2003 Goldman Sachs predicted the Chinese economy would take the U.S. economy in 2041.

Flag

National Emble m

2) Economy - overview
Since the late 1970s China has moved from a closed, centrally planned system to a more market-oriented one that plays a major global role - in 2010 China became the world's largest exporter. Reforms began with the phasing out of collectivized agriculture, and expanded to include the gradual liberalization of prices, fiscal decentralization, increased autonomy for state enterprises, creation of a diversified banking system, development of stock markets, rapid growth of the private sector, and opening to foreign trade and investment. China has implemented reforms in a gradualist fashion. In recent years, China has renewed its support for stateowned enterprises in sectors it considers important to "economic security," explicitly looking to foster globally competitive national champions. The restructuring of the economy and resulting efficiency gains have contributed to a more than tenfold increase in GDP since 1978. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, China in 2010 stood as the second- largest economy in the world after the US, having surpassed Japan in 2001. The dollar values of China's agricultural and industrial output each exceed those of the US; China is second to the US in the value of services it produces. Still, per capita income is below the world average. The Chinese government faces numerous economic challenges, including: (a) Reducing its high domestic savings rate and correspondingly low domestic demand; (b) Sustaining adequate job growth for tens of millions of migrants and new entrants to the work force; (c) Reducing corruption and other economic crimes; (d) Containing environmental damage and social strife related to the economy's rapid transformation.

3) GDP and its Growth Rate

Gross domestic product (GDP) is the market value of all final goods and services produced within a country in a given period of time. This measure of national income and output found by U.S.A. in the 1930 and Many Country follow this. GDP growth rate As of 2012, China has the world's second- largest economy in terms of nominal GDP, totaling approximately US$7.298 trillion according to the International Monetary Fund (IMF). However, China's 2011 nominal GDP per capita of US$5,184 puts it behind around ninety countries (out of 183 countries on the IMF list) in global GDP per capita rankings the growth of the first quarter was 8.1 percent, and 7.6 percent for the second quarter of 2012

Real GDP growth

YEAR % GWT 2011 9.2 2010 10.4 2009 9.2 2008 9.6 2007 14.2 2006 12.7 2005 11.3 2004 10.1

Sectors Contribution to GDP (2011)

o Agriculture: 10.1% o Industry: 46.8% o Services: 43.1%

4) Import Export Data

The total value of imports and exports in the first half of 2012 was 1,839.84 billion US dollars, a yearon-year growth of 8 percent. The total value of exports was 954.38 billion US dollars, up by 9.2 percent; and that of imports was 885.46 billion US dollars, up by 6.7 percent. The trade surplus was 68.92 billion US dollars. Exports Data

Export and import growth

MONTH Jan12 May12 12.7 15.3 Apr12 0.3 4.9 Mar12 5.3 8.9 Feb12 39.6 18.4 Jan12 -15.3 -0.5 Dec11 11.8 13.4

Import Export

6.3 11.3

Table data For Year 2011 ------------------------

production consumption Exports

4.604 trillion 4.073 million 102.5 4.693 trillion 9.4 million 129 billion cu m 19.06 billion 506,500 3.21 billion

Imports
55.45 billion 5.08 million 30 billion

Electricity(kWh) Oil (bbl/day ) Natural gas

(billion cu m)

Exports - commodities
Electrical and other machinery, including data processing equipment, apparel, textiles, iron and steel, optical and medical equipment Exports $1.898 trillion (2011 est.) $1.578 trillion (2010 est.)

Export volume of goods and services (% change)( Following Graph) In Above Chart Export is suddenly decrease Because Of recession in worlds powerful economy

i.e. U.S.A. and U.S.A. is major importer of chinas goods and services Exports - partners US 17.7%, Hong Kong 14.1%, Japan 7.8%, South Korea 4.4%, Germany 4% (2009)

Imports
$1.743 trillion (2011 est.) $1.327 trillion (2010 est.) Imports - commodities Electrical and other machinery, oil and mineral fuels, optical and medical equipment, metal ores, plastics, organic chemicals Imports - partners Japan 11.2%, South Korea 9.3%, US 7%, Germany 5.3%, Australia 4.7% (2009)

Import volume of goods and services (%) change) (Following Graph)

In Above Chart import is suddenly decrease Because Of recession in worlds most of economies But china not make zero import because china is former country on population so some bas ic need which is essential for people to live(wheat and drugs) this good and services import is not reduce during recession period.

5) Employment Level
Labor force 795.5 million
Note: by the end of 2011, population at working age (15-64 years) was 1.0024 billion (2011 est.)

Labor force - by occupation Agriculture: 36.7% Industry: 28.7% Services: 34.6% (2008 est.)

Une mployme nt rate

Unemployment rate (%)( Following Graph)

Note: Registered urban unemploy ment, wh ich excludes private enterprises and migrants, was 4.1% in 2010

6) Flow of Money i.e. FDI

Actual FDI inflows (in billions of dollars, MOFCOM measure~) YEAR
2010 2009 2008 2007 2006 2005 2004

VALUE 105.7

90.0

92.4

74.8

63.0

63.3

60.6

Stock of direct foreign investment - at home $776 billion (31 December 2011 est.) $578.8 billion (31 December 2010 est.) Stock of direct foreign investment - abroad $322 billion (31 December 2011 est.) $317.2 billion (31 December 2010 est.)

7) World Image of China

China Is Member of varies world wild organizations which are as following:-

Member of International Monetary Fund.(IMF) Member of World Health Organization (WHO). Member of World Trade Organization (WTO). Permanent Member of Security Council. Member of the United Nation. Member of Asia-Pacific Economic Coope ration (APEC) Dialogue Partners of Association of Southeast Asian Nations (ASEAN)

8) Inflation Related Numerical Data

Inflation rate
5.4% (2011 est.) 3.3% (2010 est.)

Inflation rate (consumer prices) (%)( Following Graph)

9) Monitory Policy
Budget
Revenues: $1.646 trillion Expenditures: $1.729 trillion (2011 est.)

Taxes and other revenues

23.6% of GDP (2011 est.)

Budget surplus (+) or deficit (-)

-1.2% of GDP (2011 est.)

Public debt
43.5% of GDP (2011) 43.5% of GDP (2010)
Note: official data; data cover both central government debt and local government debt, which China's National Audit Office estimat ed at RM B 10.72 trillion (approximately US$1.66 trillion)in 2011; data exclude policy bank bonds, M inistry of Railw ay debt, China Asset M anagement Company debt, and non-performing loans

Central bank discount rate

2.25% (31 December 2011 est.) 3.25% (31 December 2010 est.)

Commercial bank prime lending rate

6.56% (31 December 2011 est.) 5.81% (31 December 2010 est.) In January2012 reserve ratio change: - the current level is 16% for big banks and 14% for smaller ones. After the hike the new levels will be 16.5% and 14.5% respectively for big banks and small banks.

Bank interest rates(2012)

- One-year Yuan deposit rate - One-year Yuan lending rate 3.00 pct 6.00 pct

Reserves of foreign exchange and gold

$3.236 trillion (31 December 2011 est.) $2.895 trillion (31 December 2010 est.)

10) Measures of the Money Stock

By the end of June, the balance of broad money (M2 ) was 92.50 trillion Yuan, a year-on-year growth of 13.6 percent the balance of narrow money (M1 ) was 28.75 trillion Yuan the balance of cash in circulation (M0 ) was 4.93 trillion Yuan The amount of outstanding deposits was 88.31 trillion Yuan

11) Bibliography
Data collectors use some websites and book for perceive authentic and reliable data.

Websites:http://en.wikipedia.org/wiki/China#Economy http://www.gtig.com/en/news-view-1898.aspx http://www.stats.gov.cn/english/pressrelease/t20120713_402817907.htm http://219.235.129.58/clicksortall.do http://www.reuters.com/article/2012/07/13/china-economy-data-idUSL3E8IC2SA20120713 http://www.imf.org/external/country/CHN/index.htm?pn=0 http://www.nationmaster.com/country/ch-china/eco-economy http://factsanddetails.com/china.php?itemid=376&catid=9&subcatid=58#00 http://www.fas.org/sgp/crs/misc/96-816.pdf

Book:Principles of Economics, 6E By N. Gregory Mankiw