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Running Head: CHINA ECONOMY 1

CHINA ECONOMY 2

China economy

Student’s name

Institutional affiliation

Q1. Prior to 2012, beginning with the 1979 opening of its economy, China experienced (a) several very positive results, but also (b) several negative results and criticisms; Please identify and briefly explain (a) positive and (b) negative results. 

Positive results

· It has maintained a growth rate of 9.5%. It has been among the fastest-growing countries globally.

· Job creation. Approximately more than two hundred and fifteen million people got new jobs between 1980 and 1990.

· The country has been able to eradicate poverty to most of its citizens. Through industrialization, China had assisted an average of eight hundred million people out of adverse poverty by 2012.

· The country was also able to form trading partners due to opening its economy. By 2012 the country had already partnered with the United States. The country is the largest United States Merchandise partner and the largest source of inputs to the United States. As a result, China maintained a GDP growth rate of 14.2% from 2007 to 2012.

Negative results

· Based on the negative results, China is highly polluted. Industries in China are energy-intensive and also lead to high pollution. Heavy pollution has exposed the China population to serious health risks such as chest diseases, thus overwhelming the healthcare sector.

· Unevenly cities development. Cities that engaged in international trade, such as cities on the coast and the East, attracted more workers leaving the inland regions with few human resources, thus promoting income disparity.

· Low real wages. Workers' compensation was kept low compared to the output they produce to keep exports competitive.

· Its one-child policy hurts the country. From 1979 China became keen on controlling its population to enable effective utilization of its resources. China's fertility rate from 5.8 births in every woman to 1.6 per woman in 2012 has decreased its workforce, which is the current and future challenge to economic development.

Q2. Please briefly explain the strengths/advantages of the XiYong Industrial Park.

Chongqing XiYong is a micro-electronic industrial park development company situated in China. The company offers real estate services such as landscaping and supporting infrastructure construction. It is the largest municipality company in Western China. The main advantages/advantages of the company include;

· Abundant access to various professional human resources. Since the company is situated near Chongqing University City.

· Benefits of economies of scale. The company can source qualified personnel even outside the country, which could be difficult for similar companies with low revenue income.

· The initial cost of investments was very low. The cost of buying and leasing land for the Company's establishment is relatively low compared to other developed countries. China uses the method to encourage the establishment of low local industries.

· Advantages of a large market. The industrial park offers institutional, physical infrastructure, modern services, an institutional framework that is limited in the rest of the country.

· Advantage of High-Tech industrial chains. Therefore, the company has benefited from mutual association with other industries in accessing the ever-growing domestic market, advanced technology infrastructure and science, skilled scientists and engineers, and low-cost structures development.

· Advantage of effective inflow and outflow of service. The industry benefits from a well-developed transportation system. The transport system has also enabled the company's workforce to access support facilities such as post offices and banks easily.

· Benefits from favorable policies involving tax policies. XiYong is among companies that enjoy a fifteen percent income tax rate, which is ten percent lower than most of China's companies.