The growth of China is quite interesting because of its prevalence. You don't just see every product labeled "Made in China" for nothing. Every country fears upsetting China-- even if it is not to risk losing their enormous market. 27% of the world's billionaires are Chinese people. If that's not enough, China ranks number one in most billionaires in a single country. So one thing is for sure. China has made significant progress since its creation just over 70 years ago. But how has it stepped up to become a world power and rich? To answer that, this article will focus on the massive growth of China in the last decades.
But what was the path taken to get so successful? Experts say China's boon was something out of the ordinary. It followed its own unique path. This is why it's important to look at China's path to success, as we all know how effective it has proven to be. The growth of China was built on the idea of an organic union. The union was of the socialist and market economic systems. Thus, they used this idea of an organic union rather than heeding what the Western countries were doing.
Let's take a look at how good the growth of China has been in recent times.
Growth of China: The Uniqueness
What is the uniqueness to China's enormous boon? The Chinese-style modernization and the miracle of Chinese prosperity make up two big reasons. Both of these became possible by the unique institutional decisions and reforms. This led to China's new democratic revolution. Especially in light of the country's former semi-colonial and semi-feudal socioeconomic structure, it was a stark contrast. The CCP asserted control by measures for agriculture and handicrafts. Joint ventures for business and industry were introduced. The CPC outlined China's
- and Transformation.
Furthermore, China has achieved open rights reform. Institutional modernization is well under its political and economic engagement system. Plus, it has created and used a framework at an institutional level. This is for quick economic growth and long-term social stability.
The Structure of China's Growth Economics
China developed from a struggling nation to a world power in less than 70 years. This was all in less time than it took the USA to provide women voting rights. So, this is no ordinary feat by any means. As such, such a feat has attracted global eyeballs and investments.
But how has China done it? The two primary reasons include rapid economic growth and long-term social stability.
China's economy held an average annual growth rate of more than 9% from 1978 to 2022, reaching an all time high of 18.30% in the first quarter of 2021. In comparison, USA's average annual growth rate has only been about 3.14% from 1948 until 2022! The extent of China's growth rate was especially true during the more than 40 years of reform. The country opening up has also added to this percentage. China's per capita GDP averaged about US $16,117 last year. It even passed the United States to become the second largest economy in the world. We can call this "the miracle" of China's economic growth. This is because of the heights China has achieved. These are rarely heard of in human history.
The growth of China includes shifting from a rural to an urban setting of the country. The planned economic system led to an increase in the country's capability. Yet, it also brought rigidity and inefficiency. Systems began to lag. China has kept a problem-oriented strategy ever since the 1980s. It identifies problems via practice and frames remedies through policy experiments.
What About the Communist Party of China (CPC)? How Has CPC Contributed to the Chinese Growth?
The Communist Party of China (CPC) has changed an old farming nation into a modern, industrial one. This has been the goal ever since its rise to power. A goal that has now come real. No longer is China seen as a farming country. It is now seen as a bustling hub of the future.
Plus, China also had a lot of structural shifts during this period. We'll call it the period of rapid economic growth. This was a result of its fast industrialization and urbanization. China became the world's largest manufacturer. And it still is.
Urbanization in China increased from 17.9% in 1978 to 60.6% in 2019. Rural China has become "the miracle of China's structural transformation". This was first done by first finishing the industrialization and urbanization processes. These processes took the developed countries more than 100 years to complete! And China only took a fraction of this time. How impressive is that? It is an outstanding feat.
You should have believed us when we said the development of China is a miracle!
The Affect of China's Growth on World Poverty
Another great thing China did was help solve global poverty. China's big contribution was terrific. China's poverty rate went down from 878 million in 1981 to 9.6 million in 2015. Over the past 40 years, China has lifted nearly 800 million people out of poverty, accounting for more than 75 percent of global poverty. China has set an example. If you help yourself, it can help the world!
By 2020, China has brought down poverty rates all over its rural and poor counties. Only 0.6% of China live below the poverty line in China in 2022. By doing this, it helped turn itself around into a wealthy country. You know what makes this amazing? Their population of over 1.4 billion people! This was "the miracle" of China's alleviation of poverty.
Plus, China steered clear of tensions and disputes while growing. It focused on working on its long-term economic and social stability.
History will remember this as the breaking of the "Huntington Paradox". In a nutshell, it refers to a change that while makes us smarter, if pushed too far can lead to tragic results. China was different from the great majority of emerging nations and still has shined.
In China, tensions and ongoing social unrest have not plagued the growth. The political stability prevented the blockades of the economy or regular economic crunches. Still, care must be taken to keep the perilous balance.
China has had steady economic growth since its reform and opening up. Thus, the country also steered clear of civil war. What is more, China has "the miracle" of long-term social stability. Many experts all over the world agree with this. While there are some contrasting opinions on this, the fact remains that the effect of China's growth on world poverty cannot be ignored.
How Has China Grown Into The World's Factory
From the start, China had a unique industrialization process. China advanced from rural to macro industrialization. China is home to 28% of the world's manufacturing—nearly as much as America, Japan and Germany combined. Is that crazy or is that crazy?
The strong dual business economic system that China has is distinctive. Its urbanization doesn't only have a clear dual-track feature. Moreover, the interaction between urban and rural areas have changed. It has moved from division to collaboration to rural regeneration. Finally, they have moved to integration.
Some people think the ubiquity of Chinese products is due to the abundance of cheap Chinese labor that reduces production costs, but that's not it. What's more than the low tax and duties is the lack of regulatory compliance, and competitive currency practices have aided in the perception of China's growth as the "world's factory".
Lack of regulatory compliance means while manufactures have to worry about compliance laws like child labor, involuntary long working hours, wage laws, and more. This means they prefer to get their labor done in China. It's not only cheaper, but also more efficient.
Okay, you won't believe this... but China can STILL achieve sustained economic growth over the next 30 years. It is even more capable of mainstreaming Chinese growth theory and economics. It is on the right path to creating a strong, modern socialist state. The insane growth rate of China means that it is on course to be the richest country in terms of GDP in 2050.
So, China's economics should center on the new time. This is why the growth and evolution of China are indeed a miracle!
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Edited by: Syed Umar Bukhari.