China as an economic power in the world Free Essay Example, 2000 words

The Chinese government is aware of all these challenges and promises to address them by implementing policies that boost consumer planning and spending. In addition, it intends to expand the coverage of social safety and encourage the growth of industries that promote less pollution. During the leadership of Mao Zedong, the economy was well planned and maintained. The state controlled a large share of the country’s economic output. The state set the goals of production, controlled the prices of products, and distributed resources throughout the economy. After the death of Mao in 1978, the Chinese government decided to get rid of the soviet style economic policies by gradually embracing new reforms that had a relation to the free markets. By 1979, there were new economic reforms and farmers got permission to sell their crops on the free market. Since the introduction of these reforms, the economy of China has grown at a faster rate as compared to the pre –reform period. Economists attribute to the rapid growth of China in large-scale capital investment as well as the rapid productivity growth. We will write a custom essay sample on China as an economic power in the world or any topic specifically for you Only $17.96 $11.86/pageorder now In addition, the economic reforms increased the efficiency in the economy that led to higher output and increased resources that would aid in developing the investment in the economy. Moreover, people and nations recognize China for maintaining a high rate of savings. The decentralization of economic production led to an increase in the household savings and the corporate savings. Due to the high level of savings, China has been able to invest domestically. Likewise, China is the largest global lender and this is due to the gross domestic savings levels that exceed the domestic investment levels. The productivity gain is another factor that has led to the rapid economic growth of China. The central government led to the improvements in productivity, controlled reallocation of resources to various sectors like agriculture and trade. The rise of private firms that were more productive and the exposure of the export sector to the competitive forces inc reased a greater share of the economy. According to the United Nations, China is the world’s biggest manufacturer. By 2012, the value of China’s manufacturing on a basis of gross value was 28.2% higher than the U. S (Kee, 2010). Manufacturing plays an important role in China as a policy environment that is conducive and boosts competitiveness. It encourages investments in technology and science, education of employees as well as the development of infrastructure.