5 minutes simple guide about China development. Helps in understanding US-China relations.

[Marcin + 519]

1978 Deng Xiaoping reforms start. China is agriculture based economy, not much changed since 1952

1979-2000 Rebalancing from agriculture to industry and services. Employment in industry increases only from 17.3% to 22.5% but behind this number is modernization&reform of state owned enterprises and fast growing private sector fueled by foreign investment. Fast increase in services employment from 12.2% to 27.5%, these jobs are worse than in industry, but cater for needs of fast burgeoning urban middle class. Agriculture still employs half of population.

2001 China enters WTO.

2000-2010 China becomes the factory of the world. The largest and fastest investment&industralization program the world ever seen is done. China increases 3-10 times level of production of major industrial products.

2010 Importance of industry in economy peaks. Importance of exports in economy peaks. Services employ the same number of workers as agriculture. Starting from this year domestic consumption is the main driver of growth.

2010-2017 Further rebalancing. Fast growing services sector sucks people from agriculture. Services become major GDP creator. China becomes services based economy with still outsized industry. Agriculture employs only 27% of people. Urbanization reaches 55%.

2018-2035 Further rebalancing. Employment in agriculture decreases to around 10%. Employment in industry decreases to 20% of workforce driven by automation and moving manufacturing to poorer Asian countries. Developed, services based economy.

 

 

 

 

Edited October 27, 2019 by Marcin
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