Chinese economy: history and problems. Problems of Economic Growth. The history of Chinese agriculture. The ratio of exports and imports of goods and service to gross domestic product at current prices. Inefficiencies in the agricultural market.
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Chinese economy and agriculture

1. Chinese economy, history and problems

1.1 Chinese history

China, officially the People's Republic of China (PRC), is a sovereign state located in East Asia. It is the world's most populous country, with a population of over 1.35 billion. Covering approximately 9.6 million square kilometers, China is the world's second-largest country by land area, and either the third or fourth-largest by total area, depending on the method of measurement. China's landscape is vast and diverse, ranging from forest steppes and the Gobi and Taklamakan deserts in the arid north to subtropical forests in the wetter south. The Himalaya, Karakoram, Pamir and Tian Shan mountain ranges separate China from South and Central Asia. The Yangtze and Yellow Rivers, the third - and sixth-longest in the world, run from the Tibetan Plateau to the densely populated eastern seaboard. China's coastline along the Pacific Ocean is 14,500 kilometres (9,000 mi) long, and is bounded by the Bohai, Yellow, East and South China Seas.

The territory of China lies between latitudes 18° and 54° N, and longitudes 73° and 135° E. China's landscapes vary significantly across its vast width. In the east, along the shores of the Yellow Sea and the East China Sea, there are extensive and densely populated alluvial plains, while on the edges of the Inner Mongolian plateau in the north, broad grasslands predominate. Southern China is dominated by hills and low mountain ranges, while the central-east hosts the deltas of China's two major rivers, the Yellow River and the Yangtze River. Other major rivers include the Xi, Mekong, Brahmaputra and Amur. To the west sit major mountain ranges, most notably the Himalayas. High plateaus feature among the more arid landscapes of the north, such as the Taklamakan and the Gobi Desert. The world's highest point, Mount Everest (8,848m), lies on the Sino-Nepalese border. The country's lowest point, and the world's third-lowest, is the dried lake bed of Ayding Lake (?154m) in the Turpan Depression.

China's climate is mainly dominated by dry seasons and wet monsoons, which lead to pronounced temperature differences between winter and summer. In the winter, northern winds coming from high-latitude areas are cold and dry; in summer, southern winds from coastal areas at lower latitudes are warm and moist. The climate in China differs from region to region because of the country's highly complex topography.

A major environmental issue in China is the continued expansion of its deserts, particularly the Gobi Desert. Although barrier tree lines planted since the 1970s have reduced the frequency of sandstorms, prolonged drought and poor agricultural practices have resulted in dust storms plaguing northern China each spring, which then spread to other parts of East Asia, including Korea and Japan. According to China's environmental watchdog, Sepa, China is losing a million acres (4,000 kmІ) per year to desertification. Water quality, erosion, and pollution control have become important issues in China's relations with other countries. Melting glaciers in the Himalayas could potentially lead to water shortages for hundreds of millions of people.

The history of China goes back to the ancient civilization - one of the world's earliest - that flourished in the fertile basin of theYellow River in the North China Plain. For millennia, China's political system was based on hereditary monarchies, known asdynasties, beginning with the semi-mythological Xia of the Yellow River basin. Since 221 BCE, when the Qin Dynasty first conquered several states to form a Chinese empire, the country has expanded, fractured and been reformed numerous times. The Republic of China (ROC) overthrew the last dynasty in 1911, and ruled the Chinese mainland until 1949. After the defeat of the Empire of Japan in World War II, the Communist Party defeated the nationalist Kuomintang in mainland China and established the People's Republic of China in Beijing on 1 October 1949, while the Kuomintang relocated the ROC government to its present capital of Taipei.

Since the introduction of economic reforms in 1978, China has become one of the world's fastest-growing major economies. As of 2013, it is the world's second-largest economy by both nominal total GDP and purchasing power parity (PPP), and is also the world's largest exporter and importer of goods. China is a recognized nuclear weapons state and has the world's largest standing army, with the second-largest defense budget. The PRC has been a United Nations member since 1971, when it replaced the ROC as a permanent member of the U.N. Security Council. China is also a member of numerous formal and informal multilateral organizations, including the WTO, APEC, BRICS, the Shanghai Cooperation Organisation, the BCIM and the G-20. China is a regional power within Asia and has been characterized as a potential superpower by a number of commentators. [2]

1.2 Chinese economy

The socialist market economy of China is the world's second largest economy by nominal GDP and by purchasing power parity after the United States. It is the world's fastest-growing major economy, with growth rates averaging 10% over the past 30 years.

China is also the largest exporter and second largest importer of goods in the world. China is the largest manufacturing economy in the world, outpacing its world rival in this category, the service-driven economy of the United States of America. ASEAN-China Free Trade Area came into effect on 1 January 2010. China-Switzerland FTA is China's first FTA with a major European economy, while China-Pakistan Free Trade Agreement came in effect in 2007 is the first FTA signed with a South Asian state. The economy of China is the fastest growing consumer market in the world.

On a per capita income basis, China ranked 87th by nominal GDP and 92nd by GDP (PPP) in 2012, according to the International Monetary Fund (IMF). The provinces in the coastal regions of China tend to be more industrialized, while regions in the hinterland are less developed. As China's economic importance has grown, so has attention to the structure and health of the economy. Xi Jinping's Chinese Dream is described as achieving the «Two 100s»: the material goal of China becoming a «moderately well-off society» by 2021, the 100th anniversary of the Chinese Communist Party, and the modernization goal of China becoming a fully developed nation by 2049, the 100th anniversary of the founding of the People's Republic.

The internationalization of the Chinese economy continues to affect the standardized economic forecast officially launched in China by the Purchasing Managers Index in 2005. At the start of the 2010s, China remained the sole Asian nation to have an economy above the $10-trillion mark (along with the United States and the European Union).

Most of China's economic growth is created from Special Economic Zones of the People's Republic of China that spread successful economic experiences to other areas. The development progress of China's infrastructure is documented in a 2009 report by KPMG. [3]

1.3 Problems of Chinese Economic Growth

There are a lot of problems of Chinese economic growth, they are:

1. Pollution.

Pollution is a major problem in many industrialised cities. Increased car ownership has led to problems of smog and worsening air quality. Pollution also occurs from China's vast industrial sector. Often regulation of pollution is very limited with untreated sewage often been poured directly into rivers.

2. Shortage of Power.

The growing demand of the Chinese economy has placed great demands on China's creaking power infrastructure. This has led to the creation of projects like the Three Gorges Dam. This has been criticised for creating environmental and social problems. Environmentalists fear that the dam will severely impact on the natural habitats of many species.

3. Growing Income Inequality

China's economic growth has benefited the south and eastern regions more than anywhere else. This has created a growing disparity between north and south. The agricultural north has, by contrast, been left behind. Many farmers struggle to make a living. Therefore, this has encouraged a migration of workers from north to south. China has struggled to deal with this regional inequality.

4. Property Boom

There are fears that China has been caught up in its own speculative property bubble. Especially in Beijing and the south East, houseprices have increased significantly. There are concerns that this property bubble could burst, creating negative equity.

5. Inefficient Banking Sector.

In particular the Chinese banking sector has a bad reputation for making bad loans. Many loans are not repaid back. This is a legacy of the Communist intervention in industry. Banks often made loans to large government business' with little regard for free market principles. As a consequence it is difficult for genuine new starts to get sufficient capital funding. But, much investment is squandered.

6. Unemployment

It sounds a paradox that the Chinese economy can grow at 8% and yet unemployment is still a problem. The reason is that there are still many state owned enterprises which are grossly ineffi...