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☉ International trade is one of the factors that strongly help China’s economy
after the reformation.
☉ From 1978-2003, China's trade grew nearly five times faster than world trade.
☉ China had run a trade deficit for much of the 1980s even as imports of materials
and capital equipment for local and foreign-funded factories helped to build up its
industrial base, the deficits turned to surpluses in the 1990s
☉ Deficit that happened in China was caused by imports to start massive production
especially in textile industry, clothes, and foot wears (which then beaten by
machine and electronic production), which turned into surpluses for China.
☉ China then loosen its policies about export and import such as tariff, licenses, and
quota to facilitate and increase international trade activities.
☉ In 2004, China’s top trading partners were the US, Japan, Hong Kong, South
Korea, Taiwan, Germany, Singapore, Malaysia, the Netherlands, and Russia.
China and International Investment
☉ The growth of China can either give harm or benefit to its neighboring countries.
☉ Countries that have similar competitive advantages with China are going to have
disadvantages due to this phenomenon, since they have to compete against China
and will possibly lose their incomes and investments.
☉ Countries that are able to utilize their advantages and exploit China’s
disadvantages will eventually gain benefits. For example, the countries that own
resources that necessarily needed by China to grow, such as oil and gas, and
professional services.
☉ Neighboring countries that rely on technological advancement need to be aware of
China due to its ability to reproduce technological products and sell it with cheaper
price.
Question:
Is China a Friend or Foe?
Answer to the Question
People’s
Republic of
China
Thank You