China is ranked as the third largest global economy after Japan and USA with an economy of $3.4 trillion in 2007 (Miller para. 5). Its current great economy can be linked to its adoption of strategic economic reform policies in late 1970s.
These reforms were aimed at enhancing rural income and incentives, decrease central planning, promote experiments and business dependence. This approach for realizing these aims was referred as socialism.
With the introduction of these reforms, the local peasant Chinese farmers were now at liberty to trade their farm produce in a free market. Similarly at the grassroots level, the municipalities and provinces were free to invest in industries they regarded as more profitable. This promoted them to invest in light manufacturing industry (Making It para. 4).
This move was aimed at enhancing industrialization in the country and it succeeded to shift Chinese economy from agricultural based to light industry which was mainly for export.
The adoption of light industry that required little capital to invest in was a very appropriate move of the Chinese. This is because the Chinese were able to use the income they received from their new venture to reinvest into more advanced technologies that were more rewarding and required higher capitals
China economy is associated with very high level of investment over the years. Its entry into the World Trade Organization in 2001 was an important step in enhancing its economic growth to its current status.
This is because it was able to expand its market niche by sharing in the foreign market and also being exposed to the global competition that required it to strategize its products very strategically to compete well in this stiff and very susceptible market (Laurenceson 3). In early 1990s the China manufacturing industry was only limited to assembly of low quality products.
Due to the stiff competition that China predicted to face after joining global market in late 1990s it shifted its production from developing labor-intensive export oriented industries to high tech industries that were capital intensive. Therefore apart from the existence of a great output from the textile industries, china output now constitutes a great production of electronics goods such as mobile phones, automobiles and electric circuits.
The success of Chinese economy is closely related to its firm commitment to socialism and globalization. This is well demonstrated by the high contribution of the non public sectors that accounts up to 60% of the total GPD and more than 70% of urban and town employment (Miller para. 6).
China has adversely employed the strategy of opening up to the outside world through opening up borders, coastal and inland areas. This has enabled it to bring in large capitals, talent and technology through globalization to countries where it is doing business.
China economy is also greatly supported by its commitment to reinforce both local and global market and nurture intellectual property by actively enforcing intellectual property rights. This has greatly promoted innovations in China greatly which has enabled its products and services sell well in the global market.
In the process of promoting innovation, China has adapted a National Programme for Medium and Long Term Scientific and Technological Development. This programme have outlined 16 projects among them the development and adoption of nuclear energy, development and use of superior numerically regulated machines and development of very superior electronics devices (Laurenceson 4).
In addition the developments of new form of energies that are environmental friendly are also key issues. For instance china is the 2nd largest consumer of oil after USA. This has greatly impacted negatively on the environment. This has triggered the government to shift its effort to develop alternative source of energies such as wind and solar energies that are environmental friendly.
In its effort to develop these energies China invested US$ 34.6 billion on them. China predicts to produce about 700 million metric tons of renewable energies by 2010 and moreover to cut its carbon emission greatly by 2010. This will be facilitated by its success in completing its carbon capture and storage plant by then.
Although china enjoys one of the best economies in the world, it faces a number of challenges among the; High pollution, low household income, susceptible rural economy and low level of urbanization.
This can be overcome by the Chinese government adapting environmental friendly sources of energies. The government should also increase the urban and rural remunerations in order to boost household income. Furthermore the government should encourage people to embrace new technologies and
China can be considered as a country that have achieved a lot since 1970s after the adoption of the reform and opening policy. This is because it has been successful in maintain a Gross Domestic Product Growth of 10% since then.
In addition, it has been able to reduce poverty by 75% for a period of nearly 20 years. Moreover, the Chinese government has also been instrumental in the quest for enhanced economic development in the country by way of embracing such policies as would necessitate the attainment of this goal.
Laurenceson, James. The globalization of China’s financial sector: policies, consequences, and lessons.
Retrieved November 23, 2010, from
Making It. China’s stunning economic rise. August 2010. 23 November, 2010.
Miller, Don. China now the world’s no. 3 economy, supplanting Germany. January 2009. 23 November, 2010.