China?s challenges to future sustainable economic growth and the implications for the United States

The ?stunning comeback? of China after almost two centuries is one of the most significant trends affecting Western economies, particularly the United States (US). None of the key drives that have promoted China?s growth are really at risk if the Chinese government does not deviate from its present economic policy and keeps up gradual refinement of its unique and effective social-capitalist model. The real risks to China?s future growth are remaining poverty, the unbalanced and unsustainable growth model, bureaucracy, and the corruption of government officials. China?s government is taking determined steps to solve these challenges. The great challenge for the US is its large accumulated debt with China, and the need for additional borrowing to finance its massive economic stimulus plan. There is little doubt that US will (after solving the financial crisis of 2008 with China?s help) continue to be one of the most powerful nations in the world. Nevertheless, it will have to learn to share the world leadership with other countries, particularly with China, Europe and other fast growing developing countries. Gone is the absolute dominance of the US (in terms of ideas and money), and its use of the International Monetary Fund and World Bank as vehicles to spread its influence and market economy model over the developing world.China?s economic transformation, China?s social-capitalism, China?s challenges to economic growth, China?s remaining poverty, China?s corruption, China?s unsustainable growth model, US accumulated debt, inflation and devaluation of the dollar

China?s challenge: The opportunities and risks that China?s booming economy provides

The capability of designing to very low cost, and to compete successfully in the tough Chinese market can be transformed into a competitive advantage in other markets. On the other hand, MNCs that are not successfully in China will probably not acquire these capabilities. They will be in a cost disadvantage to compete against Chinese companies in their own markets. They run the risk of becoming secondary players to Chinese companies in the world market, as those competing in the microwave-ovens market against Galanz found out the hard way. MNCs have no choice; they have to accept ?China?s challenge? to continue world players. They have to win in China or lose everywhere.China?s challenge, win in China or lose everywhere, risks to China?s future growth, China?s entrepreneurs, China?s disruptive innovation

China-U.S. Trade Issues

[Excerpt] U.S.-China economic ties have expanded substantially over the past several years. Total U.S.-China trade, which totaled only $5 billion in 1980, rose to$387 billion in 2007. China overtook Japan to become the third largest U.S. export market, and overtook Canada to become the largest source of U.S. imports. With a huge population and a rapidly expanding economy, China is a potentially huge market for U.S. exporters. However, U.S.-China economic relations have become strained over a number of issues, including large and growing U.S. trade deficits with China (which hit $256 billion in 2007), China’s failure to fully implement its World Trade Organization (WTO) commitments (especially in regards to protection of intellectual property rights), its refusal to adopt a floating currency system, its use of industrial policies and other practices deemed unfair and/or harmful to various U.S. economic sectors, and failure to ensure that its exports to the United States meet U.S. health and safety standards. The Bush Administration has come under increasing pressure from Congress to take a more aggressive stance against various Chinese economic and trade practices. In response, it filed a number of trade dispute resolution cases against China in the WTO, including China’s failure to protect IPR and afford market access for IPR-related products, discriminatory regulations on imported auto parts, and import and export subsidies to various industries in China. In addition, the Administration reversed a long-standing policy that countervailing cases (dealing with government subsidies) could not be brought against non-market economies (such as China). In December 2006, the Administration began a “Strategic Economic Dialogue” (SED) with China to discuss major long-term economic issues between the two countries; the latest SED talks were held in December 2007. In response to growing concerns in the United States over the health, safety, and quality of certain Chinese products, the Administration in 2007 concluded agreements with China on toys, food and feed, drugs and medical devices, and tires. Numerous bills have been introduced in Congress that would impact U.S.-China economic relations. H.R. 321, H.R. 782, H.R. 1002, H.R. 2942, S. 364, S. 796, S. 1607, and S. 1677 seek to address China’s currency policy. H.R. 388 would prohibit U.S. imports of Chinese autos as long as Chinese tariffs on autos are higher than U.S. tariffs. H.R. 708, H.R. 1229, and S. 974 would apply U.S. countervailing laws to China. H.R. 1958 and S. 571 would terminate China’s permanent normal trade relations status. H.R. 275 would prohibit U.S. companies from aiding regimes that restrict Internet access. S. 1919 would limit the president’s discretion on Section 421 investigations on import surges from China. H.R. 3273 would expand U.S. export promotion programs to boost exports to China. Finally, numerous bills have been introduced to address concerns over unsafe imports (including from China). This report examines major U.S.-China trade issues and will be updated as events warrant

Public Finance in China since the Late Qing Dynasty

How is "public finance" organized in China? Is China’s public finance system different from that of other countries? Can we detect features which link today’s system to the past?Public finance refers to more than annual state budgets and constitutional procedures. It includes foreign debt, state monopolies or monetary policies, all of which played a crucial role in China’s public finance during the last hundred years. A purely legislative definition obscures the fact that changes in public finance have contributed to the collapse of political regimes such as Imperial China (1911), Republican China (1927), and KMT-China (1945), as well engendered regime changes in 1949, 1961 and 1978. From a more comprehensive economic perspective public finance in China encompasses institutions, organizations and policies.public finance;China;KMT-China;imperial China;republican China

FDI Liberalization as a Source of Comparative Advantage in China

Three features of China?s trade patterns suggest that elements beyond factor abundance explain its export performance. The high penetration in world markets of labour-intensive products has been accompanied by: (i) a high share in exports of productivity-advanced foreign-owned enterprises (FIEs), (ii) a high penetration of FIEs in labour-intensive sectors, and (iii) a relative high sophistication of China?s exports. We show that FDI liberalization endogenously introduces Ricardian features to an otherwise standard endowment-based trade model, strengthening China?s natural comparative advantage in labour-intensive products. We discuss how capital accumulation, productivity growth, rural-urban migration, incentives for foreign investment and distortions in financial markets affect this bias. We conclude that policies enhancing domestic firms? production, through productivity growth or capital market distortions, implicitly support the capital-intensive sector. In contrast, policies that encourage FDI, like greater access to China?s capital and labour market would shift China?s comparative advantage even further towards labour-intensive products.comparative advantage, FDI liberalization, labour markets, China

PRODUCTIVITY AND ECONOMIC GROWTH: AN EMPIRICAL ASSESSMENT OF THE CONTRIBUTION OF FDI TO THE CHINESE ECONOMY

We estimate the contribution of FDI to the efficiency and productivity growth in a cross-region regression framework, utilising China¡¯s provincial data from 1984 to 1997. We find a bidirectional causal linkage between FDI and productivity growth across the regions in China, suggesting that changes in FDI intensity Granger-cause changes in productivity, and vice versa. China¡¯s economic growth is found largely due to the rapid expansion of investment in fixed assets. Human capital development becomes increasingly important to the labour productivity growth, and FDI has certain effects on labour productivity but not so strong and significant. Thus, the contribution of FDI to China¡¯s technological progress through technology transfer is still not noticeable, and many regions in China still experience inefficiency. This raised the concern over the issue of how to improve economic efficiency and technology transfer in order to sustain China¡¯s rapid growth in the long run. It also concerns what kinds of development strategy and industrial policy toward FDI that China is to form.China, Growth, Productivity, FDI, Human Capital

THE IMPACT OF CHINA´S ACCESSION TO WTO ON THE EXPORTS OF DEVELOPING COUNTRIES

Using the "revealed competitive advantage indices" for exports and imports, the paper is devoted to the analyses of the vulnerability of selected developing countries if China´s competitive position is improved due to its entry to WTO. In contrast to the existing literature which concentrates on labour-intensive products as a group, this paper considers products at a disaggregate level since products in the same group are not often homogeneous. In labour-intensive manufactured goods, China competes mainly with South Asian* countries and a few Latin American and African countries. But it also provides them with little demand complementary effects. Nevertheless, some Latin American and African countries may benefit from the expansion of China´s imports of foods and agricultural raw materials. In the final market for capital goods China competes with Asian newly industrializing economies (NIEs) and Association of South-East Asian Nations (ASEAN) countries, and in a limited number of goods with Mexico and Costa Rica. For NIEs, unlike others such competition involves complementary effects, through the import of parts and components, which will over-offset the competition effects in the short- and medium-run. As China develops its capacity to produce components, however, the "competition " effect may dominate. China´s export structure is similar to that of the Republic of Korea and Malaysia in the final market for a number of "finished" capital goods. By contrast, Thailand is vulnerable in clothing, miscellaneous household equipment and electric machinery. Indonesia has little to worry except for furniture. India concentrates mainly on undergarments, and China in outer garments. Bangladesh, Sri Lanka, Pakistan, Viet Nam and Nepal have similar export structure with China in some clothing items, but overall they, particularly Viet Nam have been aggressive in exportation of these products. Sri Lanka and Pakistan also compete with China in toys and sporting goods, but both have shown some strength in their exports. Except Mexico, Costa Rica, Haiti and to some extent Uruguay, the export structure of the Latin American countries is mostly different from that of China. Mexico has a strong competitive position vis-à-vis China in a number of clothing items, but weaker in a few assembly operation. Costa Rica´s competitive advantage has noticeably improved for a number of clothing items and a few assembly operations. Haiti competes with China in 8 products, mostly clothing. It has a strong competitive position in footwear, one clothing item and some base metal. Uruguay´s relative competitive position is weak in a number of labourintensive products. The export structure of African countries is different from that of China, except for Egypt, Morocco, Tunisia and Malawi. These countries have improved their competitive position in their clothing. China´s entry into the WTO will not change, for some time, its market access for textiles and clothing for it to be a threat to other developing countries. In fact, China´s growth in quota for exports to developed countries will increase far less than other developing countries. Nevertheless, if China attempts devaluation the situation could change radically. China´s devaluation is however unlikely. Over a longer-term, much depends on what policy China will pursue in its trade and industrialization. China´s attempt in increasing domestic value added in exports could lead to improvement in its competitiveness in technology/skill intensive products of interest to NIEs and the ASEAN.

Component Trade and China?s Global Economic Integration

China?s engagement in the so-called international fragmentation of production ? namely ?cross-border dispersion of component production/assembly within vertically integrated manufacturing industries? ? has become an increasingly important form of its economic integration into the regional as well as the global economy. The paper presents the recent trend of trade in parts and components between China and its main trading partners. Applying an adjusted gravity modelling method, the paper explores how China?s pattern of trade in parts and components is being determined. The paper found that China?s rapid economic growth, increasing market size and economies of scale, foreign direct investment and infrastructure development including transportation and telecommunications are important factors in explaining China?s rapid increase of bilateral trade in parts and components with its trading partners. The paper also found that the spatial distance and transportation costs have significant negative impacts on China?s trade of parts and components suggesting that the reduction in transportation costs by technological innovation and investment could enhance trade in parts and components, and thereby deepen the process of international specialization involving China and its main trading partners. The paper argues that given the prospects of the rapid growth of the Chinese economy, its current and planned massive investments in R&D and in infrastructure, its continual policies in attracting FDI and its rapid move towards liberalizing its services sectors including its financial sectors, the scope for China and its trading partners to benefit from the process of international fragmentation of production is tremendous.component trade, international fragmentation of production, gravity model

Mongolia: China’s perfect neighbour?

Russian influence in Mongolia began to decline after the collapse of the Soviet Union. Since then, China has become the most important player in Mongolia’s economic development. China is Mongolia’s leading trading partner and the main focus of its diplomacy..

Does metal pollution matter with C retention by rice soil?

Date of Acceptance: 17/07/2015 The research work was supported by the China Natural Science Foundation under a grant number of 40830528 and of 40671180. P.S. is a Royal Scoiety-Wolfson Research Merit Award holder and was supported by additional travel funds from a UK BBSRC China Partnership Award. P.S.’s contribution was supported by the UK-China Sustainable Agriculture Innovation Network (SAIN). D.C. was supported by an additional travel and collaboration funding from the China Ministry of Education under a “111” project.Peer reviewedPublisher PD