The rapid path of China towards economic development is highly documented. Even though this growth rate seems to appear slowing at some points, there is highly any doubt that the China’s economy is playing a pivotal role in the global economy.
China pursued the export oriented path initially towards industrialization, but later started to diversify into other economic sectors within the span of last 10 years. It has been done with unwavering determination to help in the growth rates and expanding the economic reach. There are top 5 reasons on why China economy is rapidly growing and let’s talk about that in details.
1. The ultimate labor supply:
As per some of the major China economy news, there are plenty of workers in China, with a steady rural and urban migrants looking for work. It is mainly because of the mechanization of agriculture that led towards under-employment and unemployment in the rural parts of the country and with concurrent growth towards industrial sectors.
- From some recent studies, it has been found out that around 500,000 million people left the countryside of China, looking for work in the city for the last two decades.
- Then you have voluntary migration of the current rural population, which was well accompanied by aggressive re-planning schemes.
With rural villages getting demolished, people are moving towards cities looking for job. That helped in the growth of the economic sector of the country to the next level.
2. Unemployment and the wages:
As per China economy news, the unemployment rate has actually fallen in recent years to over 4%. However, the higher rates in past drove down the wages. In case the workers are looking for higher wages, there are multiple more to take the jobs available.
Wages in the other East Asian countries will earn 10 times more than the Chinese workers. It has increased profit margins and attracted inward FDI as European, American and Japanese companies opening factories under Chinese License.
3. The addition of female participations in workforce:
The China’s current workforce is well characterized by the higher number of female participation within the manufacturing industry. It has been all over the China economy news lately.
- The western cultural analyses of the gender divisions in workforce will have little relevance within Chinese economic growth.
- This section, along with the one-child policy has meant that women were involved in child-raising for a shorter span than before and even when compared to other countries.
- So, now the Chinese women get a lot of opportunities to work in factories and industries to help with the economic growth of the nation.
- With more working hands together, the supply process is a lot faster in China when compared to other countries.
All these new and heavy growth in the laboring sector is enough to showcase how Chinese economy is growing and how well it is taking the next steps forward.
4. Dealing with the political system:
The authoritarian and non-democratic political Chinese regime meant that it is not possible to embrace the western-style free market economics and also maintaining a total control over the political systems. As mentioned in China economy news, in multiple ways, the planned Chinese economy has accelerated economic growth due to the government having total control over decision making.
Since 1953 Mao, the government has followed series of Five Year Plans, which helped the government to enact any sort of reform that it feels to be necessary. This country, at present, is in its 12th Five Year Plan with policies including spending 2.2% of GDP on R&D, moving coastal regions to the hubs of R&D and more.
5. Stronger leaderships along the way:
Chinese politicians are known to have a greater responsibility to the nation, then towards their own goods. They are thinking about ways to make China a leader in the economic sector, which is why there is a booming growth in this sector. Stronger leadership from the head of the state has been one of the major contributing factors behind the current economic success of the country!
All these 5 points will surely answer your questions on why China economy is growing so fast and how it helps the global economy in a broader sense.
Also Read: Apple announced to invest $350 billion in the US economy
