Let’s get started CHINA GROWTH IN THE PERIOD BETWEEN 2010 AND 2020

FOREIGN TRADE UNIVERSITY INSTITUTE OF ECONOMY AND INTERNATIONAL BUSINESS **************** MACROECONOMICS MID-TERM TEST CHINA’S GROWTH IN THE PERIOD 2010-2020 Students: Nguyen Thi Hong Ngoc – Leader - 2112530035 Tran Quoc Viet - 2112530056 Nguyen Minh Anh - 2112530005 Pham Phuong Anh - 2111530007 Nguyen Hoang Anh - 2114530002 Class : KTEE203K60CLC.LOGs.1 Teacher: Mrs Nguyen Minh Thuy Ha Noi, 2021 FOREIGN TRADE UNIVERSITY INSTITUTE OF ECONOMY AND INTERNATIONAL BUSINESS **************** MACROECONOMICS MID-TERM TEST CHINA’S GROWTH IN THE PERIOD 2010-2020 Students: Nguyen Thi Hong Ngoc – Leader - 2112530035 Tran Quoc Viet - 2112530056 Nguyen Minh Anh - 2112530005 Pham Phuong Anh - 2111530007 Nguyen Hoang Anh - 2114530002 Class : KTEE203K60CLC.LOGs.1 Teacher: Mrs Nguyen Minh Thuy Ha Noi, 2021 ACKNOWLEDGEMENT First of all, we would like to give our best regards to Mrs Nguyen Minh Thuy for letting us have the opportunities to learn and explore new things about economics This group task means a lot to us as it helps us understand more about economics, inflation, policies, as well as get to know more about China Additionally, we’ve learned many other things such as assigning tasks equally, time-management, researching data, making a slide, and most importantly, getting closer with other friends in the class This is the first time ever we have been given such a hard task that is written all in English We have tried our best and hope that you would be satisfied with our work Thank you! CONTENTS FOREWORD .1 CHINA GROWTH IN THE PERIOD BETWEEN 2010 AND 2020 .2 I ECONOMY GDP 2 Inflation Rate FDI Trade Balance 10 Major Trading Partners 14 Urbanisation Rate 15 Consequences of Economic Development 16 II Living Standards 22 HDI 22 Education 23 Life expectancy .27 Welfare 29 Labor 32 Income and cost of living .36 III Policies 39 One-child policy 39 Social Credit System: 42 IV Strengths, Weakness, Risks and Challenge 43 Strengths 43 Weakness 46 Risks and Challenges 50 SUMMARY 52 LESSONS FOR OUR VIETNAM 54 REFERENCES 55 FOREWORD Everyone knows that China is the world’s most populous county with more than 1.4 Billion residents as of 2021, but beyond demographics, there are a lot more outstanding and coveting aspects of China that some of you might fail to notice Here come the reasons why we choose China to be the country that we analyze in this essay China is one of the cradles of the world’s civilizations with written records dating back to more than 4,000 years ago Even in the modern era, the country is still immersed in its longstanding culture and heritages Since ancient times, China has obtained a plethora of achievements in advanced agriculture, metallurgy, ceramics and silk textures, astronomy, science and technology, etc The Chinese have been the inventors and discoverers of various objects and phenomena, which are still having a huge impact on the entire world and leaving a grand treasure of knowledge for the future generations to make full use of It was such a shame that in the past, the country's feudal bureaucratic system held back science and inventions from making further progress, and prevented Chinese society from developing modern science; otherwise, many more innovations could have been created However, since the People’s Republic of China initiated economic reforms and trade liberalization nearly 40 years ago, the country has entered a new era and focused more on expanding its economy and improving people’s living standards, making it one of the world’s largest and most prosperous nations Since opening up to foreign trade and investment and implementing free-market reforms in 1979, China has been among the world’s fastest-growing economies, with real annual gross domestic product (GDP) growth averaging 9.5% through 2018, a pace described by the World Bank as “the fastest sustained expansion by a major economy in history.” Such growth has enabled China, on average, to double its GDP every eight years and helped raise an estimated 800 million people out of poverty China has become the world’s largest economy (on a purchasing power parity basis), manufacturer, merchandise trader, and holder of foreign exchange reserves This in turn has made China also places a great emphasis on the improvements of infrastructure by launching consecutive projects, which have amounted to 3,485 projects as of 2019 Nearly half, or 43%, of the projects concern the construction of roads, railways, ports, airports, electrical systems and dams Another 42% are social infrastructure such as hospitals, schools, and so on The remainder are projects supporting tourism and agriculture Investments in infrastructure are increasingly high and have no signs of ceasing Rail transport is an important mode of longdistance transportation in China As of 2020, the country had more than 146,000 km of railways, the second longest network in the world By the end of 2020, China had just under 38,000 kilometers of high-speed rail (HSR), the longest HSR network in the world Other China’s aspects such as culture, living standards, education, environment are extremely diverse, perplexing and intriguing at the same time As China has a wide range of interesting characteristics and an ever-changing and dynamic economy, we would really like to get an insight into them and explore what has made it so incredible over the last decade Each aspect is thoroughly analyzed in the following parts and we would occasionally add our or some experts’ comments on that aspect so that everything is crystal clear Let’s get started! CHINA GROWTH IN THE PERIOD BETWEEN 2010 AND 2020 I ECONOMY GDP a) The scale of GDP Gross domestic product (GDP) is the total monetary or market value of all the finished goods and services produced within a country’s borders in a specific time period As a broad measure of overall domestic production, it functions as a comprehensive scorecard of a given country’s economic health The economy of China developed rapidly from 2010 to 2020 Indeed, the GDP of China in this period grew constantly and dramatically At 2010, Gross Domestic Product of China was just over trillion U.S dollars, however, 10 years later, it has doubled in 2017 at over 12 trillion U.S dollars and continued to grow and reached its peak in the period in 2020 at 14,723 trillion dollar which is 245% bigger than its figure in 2010 (Current US$ ) Source : The World Bank GDP – China In The Period 2010-2020 In the whole world, the period of time from 2010 to 2020 which is called a miracle growth of China’s economy has marked an important stage in the history of this country’s economy From 2010, the GDP of China has passed the GDP of Japan and officially become the second largest economy by GDP just after the US At the same time, while the GDP of Japan and the UK almost unchanged, that figure of China and the US grew rapidly and even from 2019, while the world economy has been extremely negatively influence due to the outbreak of COVID 10 and even the largest economy in the world – the USA has seen a decrease in GDP, the China’s GDP has still continued to rise steadily In 2020, The GDP value of China tripled that of the third largest economy by GDP- Japan and represented 18.33 % of the world economy Source : The World Bank Top Largest Countries By GDP In The Period 2010-2020 b) The GDP’s compositions of China Economic restructuring of China's economy in the period from 2010 to 2020 was impacted a lot by the rise of technology and 4.0 industrialization and the economy of China has tried to reduce the density of Agriculture and has moved towards industrialization and modernization From 2010 to 2020, the structure of China’s GDP has changed in the trend of the market economy They have cut down on the percentage of Agriculture and Industry while constantly impulsing the development of Services From 2010 to 2019, while the GDP from Agriculture decreased by 3% and the GDP from Industry dropped by 7.72%, the GDP from Services increased dramatically by 10.71% and has become the largest GDP’s contributor since 2012 Source : Asia Briefing China’s GDP Composition (%) In The Period 2009-2019 c) Reasons Source: Ceicdata China Private Consumption Expenditure (USD) 2010 – 2020 Many factors have led to the enormous GDP of China in the past ten years but there are also some major reasons for this miracle growth To achieve this success, the Chinese government has spent a huge amount of money on public services including transportation, army, etc We can see an obvious impressive development and change of China’s infrastructure In addition, in this period, new companies and start-ups appeared densely and many of them have succeeded to expand and become large corporations which contributed a lot to the national GDP China has also made use of technology perfectly and with the enormous labour force, it has become the engine to impulse the scale of production in China The appearance of the Belt and Road initiative in 2013 also has paved the way for the growth of China’s Net export Besides, policies that aimed to improve mode of services such as tourism, entertainment also proved to be effective contribution to the whole GDP Source: Tradingeconomics.com China Government Spending (CYN) 2010-2020 d) GDP Growth Rate In the past ten years, although Chinese GDP constantly increased, the GDP growth rate had a tendency to fall dramatically This trend was supposed to be mainly caused by the persistent trade war between China and The US But the war is not the only factor behind the slowdown The government’s green industrial policy, tighter regulation of the property sector, and blacklists of online platforms also have collectively curtailed growth Besides, the pandemic COVID 19 also significantly held back the growth speed of Chinese GDP From a country with the GDP growth rate always beyond 10% in 30 years before, in the period 20102020, this rate had dropped catastrophically and reached the bottom at 2.3% in 2020 and ranked 16th in the world according to Statista Source: The World Bank GDP Growth (%) In China 2010 – 2020 e) GDP per capita From 2010 – 2020, with the rise of GDP, GDP per capita of China also increased substantially by 230% just after 10 years and reached 10500 USD in 2020 However, despite the enormous GDP figure, China is the most populous country in the world with over 1.4 billion people, therefore, GDP per capita of China is still low and below the world average GDP per capita In 2020, Chinese GDP per capita ranked 53 rd in the world and 8th in Asia according to the global economy Source: The World Bank GDP Per Capita Of China 2010 – 2020 Inflation Rate Inflation is a common worldwide, complex, comprehensive macroeconomic phenomenon, its definition in economics also did not achieve consensus, now the most popular definition is: Inflation is a process of rising prices, or is a process of continued depreciation of the currency value Inflation in China is driven by volatile yet persistent changes in food and energy prices, making it difficult for policymakers and investors to gauge the underlying inflation trend Current and prospective inflation matters a lot to monetary policymakers and market participants In the case of China, and in most other emerging markets, food and energy account for a heavy weighting and play an important role in inflation dynamics Excluding these components may lead to an excess volatility reduction Source: populationPiramids.net Population Piramids Of China In 2010 And 2020 Actually, China eventually gave up on the one-child policy because of the many disadvantages that they faced with its implementation Starting in January 2016, the nation is now using a universal two-child policy that applies to each household Even though 76% of Chinese nationals said that they supported the concept of government-based family planning, the use of forced sterilization, contraception, and abortions to ensure compliance was highly controversial in the rest of the world In conclusion, the advantages and disadvantages of the one-child policy may have prevented hundreds of millions of births that could have caused problems for the Chinese economy, but there are lessons to be learned from this process as well Social Credit System: a) The mechanism of social credit system By its wide meaning, China's social credit system is a collection of databases and initiatives that track and assess the trustworthiness of individuals, businesses, and government entities Each entry is given a social credit score, with high scores receiving rewards and bad scores receiving punishment This policy was implemented first in 2015 After gathering, combining, and evaluating data from many sources, the social credit system generates a score for both individuals and businesses Businesses are required to report information on their partners and suppliers to municipal and national authorities in addition to their activities A company's credit score is also influenced by bad behavior, lack of trustworthiness, and supplier and customer ratings A good rating will result in rewards, whereas a bad rating may result in a person or company being punished or sanctioned Individuals who are deemed untrustworthy may suffer a variety of restrictions in areas such as loans, air and rail travel, and education Some municipal governments have offered incentives such as prioritizing health treatment and waiving deposits for public housing to encourage good conduct The reward mechanism is not as developed as the sanctioning aspect, according to a report on the corporate social credit system published by the European Chamber of Commerce in China in 2019 Sanctions are not limited to fines or court rulings, according to the study, and companies on the blacklist may face increased inspection rates and targeted audits, as well as limits on government approvals of land-use rights and investment licenses They may also be banned from receiving preferential policies such as subsidies and tax breaks, as well as having their public procurement rights restricted Individuals and businesses found to be untrustworthy will be publicly identified and shamed b) Social credit system’s Efficiency: The system aims to improve transparency for the public, although it also serves as a tool for the government to impose control on almost all aspects of its citizens’ lives Premier Wen Jia Bao said that the creation of a social credit system would ensure honesty, self-discipline, trustworthiness, mutual trust and that those who cheat and are dishonest would be punished The data-based scoring mechanism also serves as an objective approach to evaluating the trustworthiness of individuals and companies, the government says This system works so efficiently that Chinese police once successfully arrested a wanted man among a crowd of 60,000 people at a music show in April 2018 The same system also helped authorities arrest 25 wanted criminals during the international beer festival in Qingdao (China) By using AI to recognize faces and then compare them with a huge online data-based about the entire population of the country, the government can detect any individual in just a few seconds and the accuracy is exactly up to 99%, which can be considered the most accurate face recognition system in the world now Citizens' behavior has improved, crime has dropped, and social security has been noticeably stabilized since the program was introduced On the other hand, it shows that the system is supported by the majority of Chinese citizens In one peer-reviewed study, 80 percent of respondents said social credit scores were either moderately or strongly approved Only 1% of participants expressed strong or moderate dissatisfaction with the system c) Controversy From a worldwide viewpoint, however, there has been significant opposition to the social credit system One of the most contentious parts of the social credit system for individuals is that it tracks behavior and assigns residents a trustworthiness rating based on sometimes inadequate or erroneous data, according to critics Critics of China’s social credit system often say Beijing’s commitment to regulating behaviour and mass surveillance is Orwellian in nature, where a government tries to control every part of people's lives, similar to what was described in the novel 1984 by English author George Orwell There are also concerns about data credibility, data protection and invasion of privacy in China due to weak regulations and law enforcement Questions also remain as to whether the name-and-shame tactics and sanctions can improve credibility and reduce outstanding debt, especially among local governments and state firms, some of which have long-standing financial problems According to a research by the European Chamber of Commerce in China, companies, particularly international firms, are concerned about significant data transfers that are likely to include sensitive data such as technological specifics and personnel information The European trade organization was particularly concerned that the option for blacklisting "highly distrusted entities" may turn the corporate social credit system into a tool for trade disputes Conclusion In conclusion, while the social credit system is questionable in certain ways, it worked effectively and had a good impact on citizens' behavior, causing the economy to grow swiftly IV Strengths, Weakness, Risks and Challenge Strengths a) Geographical location and territory of China China is divided into five time zones and has borders with 14 nations It is the world's fourth-largest country, covering around 9.6 million square kilometers (3,700,000 square miles) These geographic features provide China with a varied range of natural landscapes, aiding agricultural, tourism, forestry, mining, and other industries Furthermore, because of its central location in Asia, China has easy access to neighboring countries, allowing it to grow its open economy and maritime commercial sectors b) Population and society With a population of over 1.4 billion people, accounting for 20% of the global population, China is the world's most populated country China's strong human resources drew investment capital from developed countries and multinational corporations in the end of the twentieth century and the first decades of the twenty-first century, accelerating economic growth To put it another way, cheap labor has long been regarded as the driving force behind China's economic miracle, propelling the country to the status of the world's factory, altering global supply chains, and raising China to the status of a global superpower China is one of humanity's biggest civilizations, and it represents a component of the Eastern people's ideology Chinese culture has progressed with each passing epoch Precious traditional values have always been protected and fostered by the Chinese, following the swirl of the nation's history With 56 ethnic groups, China is a cohesive multi-ethnic country Furthermore, each year, a large number of foreigners travel to China to reside This has aided China's access to many other global cultural and civilization flows, diversifying the country's cultural identity The Chinese have a long history of being known for their hard work, intelligence, inventiveness, hospitality, solidarity, gratitude and affection These characteristics have aided in improving China's brand in the minds of international friends, boosting investment and economic development among countries, and establishing China as an Asian superpower c) Political System It is self-evident that if political instability leads to regime change, economic and social stability would surely disappear in every country It's easy to see why countries that have undergone a "color revolution" are inevitably thrown into chaos, with surging prices, shortages of basic commodities, frequent violent clashes, and a perilous state of life and property Furthermore, China's 1.4 billion-strong population makes maintaining a stable political order more difficult But why does China continue to be regarded as a stable, secure, and successful country? The explanation can be found in the country's political system China is a one-party state ruled by the Communist Party of China (CCP) The President, who is elected by the National People's Congress, is the titular head of state The Premier is the head of government, presiding over the State Council, which is made up of four vice premiers and ministers and commission heads Xi Jinping, China's current president, is also the General Secretary of the Chinese Communist Party and Chairman of the Central Military Commission, making him the country's most powerful leader The first advantage is that China could design a long-term strategy for national growth and assure policy stability without being influenced by the alternation of parties with differing perspectives and ideologies under a one-party system The second one lies in its high efficiency, and promptly effective reaction to emerging challenges and opportunities Song added, especially in response to sudden and catastrophic accidents such as Covid-19 A 2020 survey from the Canadian Institutes of Health Research also found that 75% of Chinese were satisfied with the government on information dissemination amidst the COVID-19 pandemic The last one is that one party (the Chinese Communist Party) can truly represent the whole people Under the Western multiparty system, each party represents different interest groups But in China, since the reform and opening up, economic policies have been made without special bias in favor of any interest groups With a strict political system like this, most people will obey the laws, guaranteeing security and social order in a nation with an ultra-large population like China To summarize, China's true distinguishing feature is its functional political structure, which explains why the country has been able to achieve significant economic success and pioneer an entirely new path to modernization known as the China Model d) Military China has the world's third-most powerful military, as well as the world's third-largest nuclear weapons stockpile The People's Liberation Army (PLA), headed by the Central Military Commission, is the world's largest standing military force, with 2.3 million active troops (CMC) China boasts the world's second-largest military reserve force, after only North Korea in size With a strong army, China can strengthen national security and safeguard its citizens if any wars occur e) Science and Technology China has made substantial investments in scientific research since the end of the Cultural Revolution, and is swiftly catching up to the United States in R&D spending China invested $279 billion in scientific research and development in 2017 Science and technology are regarded as critical to attaining China's economic and political objectives, and are regarded as a source of national pride to the point of being referred to as "technonationalism." According to the World Intellectual Property Indicators, China was No in international patents application in 2019 China ranks first globally in the important indicators, including patents, utility models, trademarks, industrial designs, and creative goods exports, and China also has two of the top five scientific and technology clusters in the world, more than any other country China's educational system is being developed with a focus on science, technology, engineering, and mathematics (STEM) (STEM) In 2016, China overtook the United States as the world's largest publisher of scientific articles Chinese technology businesses such as Huawei and Lenovo have risen to prominence as global leaders in telecommunications and personal computing, and Chinese supercomputers are frequently ranked among the most powerful in the world Since 2013, China has been the world's largest market for industrial robots, accounting for 45 percent of newly installed robots between 2019 and 2021 f) Infrastructure After a decades-long infrastructural boom, China has produced numerous world-leading infrastructure projects: China has the world's largest bullet train network, the most supertall skyscrapers in the world, the world's largest power plant (the Three Gorges Dam), the largest energy generation capacity in the world, a global satellite navigation system with the largest number of satellites in the world, and has initiated the Belt and Road Initiative, a large global infrastructure building initiative with funding on the order of $50–100 billion per year The Belt and Road Initiative has the potential to be one of the most ambitious development schemes in history China's transportation network and sophisticated infrastructure have aided domestic trade, supply chain smoothing, transportation development, and, in particular, the tourism industry In summary, China, well-aware of its strengths, has progressively supported the development of those capabilities, utilizing them to establish a more prosperous economy in the future Weakness a) China Banking System and Debt Level State-owned or state-controlled banks control the majority of China's banking system In 2015, the top five largest banks in China in terms of assets were state-owned entities Foreign participation in China's banking system is relatively small, accounting for 1.6% of total bank assets Additionally, the managers of China's state banks are drawn from the ranks of the Chinese Communist Party cadre system, which "enables the party and government leaderships to exert influence over bank lending." The Chinese central government uses the banking system to boost credit in order to help meet its GDP growth objectives and to, when needed, offset the impact of global economic downturns, such as after the 9/11 terrorist attacks and the global financial crisis Source: Bank for International Settlements Note: * As of second quarter 2016 Core Debt Of Nonfinancial Sectors In 2016*As A Percentage Of GDP For Selected Economies This state-dominated banking system has a severe shortcoming that it regularly disregards market principles, such as risk assessment, and allocates credit unfairly to private firms Private corporations must frequently pay higher interest rates or seek financing elsewhere, whereas SOEs (state-owned enterprises) enjoy preferential credit treatment from government banks SOEs accounted for 85 percent ($1.4 trillion) of all bank loans in 2009, according to one estimate It is thought that SOEs often default on their debts, leaving banks with an everincreasing volume of nonperforming loans National Debt In Relation To Gross Domestic Product (GDP) From 2009 To 2019 With Forecasts Until 2026 As indicated in the figture, China's combined household, corporate, and government debt levels as a percentage of GDP as of mid-2016 are comparable to those of the United States and South Korea and lower than those of Japan and the European Union However, China's debt levels (in both dollars and as a proportion of GDP) have risen dramatically in a short period of time, prompting some to fear that the country could face an economic crisis in the future China's corporate debt has risen from $3 trillion to $17.8 trillion (an increase of $14.8 trillion) and now far exceeds that of the United States In China, the national debt-to-GDP ratio climbed steadily from 33.92 percent in 2010 to 66.33 percent in 2020, with the debt-to-GDP ratio increasing drastically in the decade 20102020 China's debt level shows no indications of slowing down, and by 2026, it may even surpass 80% of GDP, according to the chart above Several economists have warned that China's credit expansion may be excessive, causing debt burdens in many industries, contributing to bubbles (such as in real estate), and, more severely, jeopardizing long - term economic growth On the other hand, local government debt is also viewed as a big problem in China, largely because of the potential impact it could have on the Chinese banking system During the beginning of the global financial slowdown, many Chinese subnational government entities borrowed extensively to help stimulate local economies, especially by supporting infrastructure projects In December 2013, the Chinese National Audit Office reported that from the end of 2010 to mid-year 2013, local government debt had increased by 67% to nearly $3 trillion The Chinese government reported that local government debt rose to $4.3 trillion as of 2015 Total Debt Service (TDS) On External Debt From 2010 To 2020 Another index to consider in order to get a broad picture of China's banking system is Total Debt Service (the cash that is required to cover the repayment of interest and principal on a debt for a particular period) Looking at the graph 3, between 2010 and 2020, China's total debt service on external debt increased at a rapid pace While in the period from 2010 and 2014, China's external debt grew steadily from $52,104 billion to $81.603 billion (up $29,499), it rocketed by $194,174 billion from 2014 to 2019, reaching a peak of $275,777 billion in 2019, which about 5.3 times the debt level in 2010 b) Trade War On March 22, 2018, the US-China trade war formally began when US President Donald Trump announced a levy on $ 50 billion in Chinese goods sold to the US in order to curb what they claimed were unfair trade practices and intellectual property theft The trade war between the United States and China has long-term consequences for China's economy China's export growth rate to the United States reached 13% in August 2018, which was not only greater than developed countries such as Europe and Japan, as well as the average level of exports to foreign countries, but also higher than the previous month's growth rate of 11.2 percent As a result, there is a cautious optimism that the trade war will have little impact on China's economy and exports In reality, however, the consequences of the trade war between China and the United States are far more severe First, as a result of the trade war, foreign direct investment in China is declining The threats of a trade war, according to economist Shen Kien Quang, will have a significant impact on market confidence For example, an increasing number of multinational corporations are cautious to invest in China and they are gradually changing their global strategy Some big Japanese businesses have reconsidered their business in China and plan to relocate production to other countries in order to avoid high US import tariffs In 2018, Apple expressed concern about rising tariffs, but US President Donald Trump stated that all Apple needed to was returning their manufacture to the United States, and the problem would be fixed China's stock market has struggled both at domestic and international levels, with the Shanghai Composite Index plummeting below 2,700 points in the first three quarters of 2018 Second, trade war may raise the unemployment rate in Chinese society If a trade war between China and the United States breaks out, China's export commodities to the United States can theoretically be reallocated to other nations and areas, but in practice, this is a major difficulty for China China's products exports to the United States accounted for 19 percent of the country's overall merchandise exports in 2017 Furthermore, because China specialized in traditional industries that required a large labor force, exporting to the United States created a large number of job and innovation opportunities According to the "Report on the value-added of trade in China and the global value chain" in 2012, each million dollars of output shipped to the United States created approximately 60 jobs in China, implying that 500 billion dollars of output created 30 million jobs for Chinese nationals Third, Trade war will disrupt the supply chain, severely affecting the whole economy China is reliant on imports of key technologies from the United States to some extent Electronic chips, for instance, are exclusively available in the United States; therefore, if the United States ceases selling these fundamental technologies to China, it may have a consequence on China's industrial supply chain For example, Intel and AMD are widely utilized in personal computer CPUs, and most Chinese mobile phones have GPS systems Finding substitute items will be extremely challenging for China Finally, although there is no trade war with neighboring countries, China frequently engages in aggressive and unfavorable territorial conflicts with its neighbors China deployed the oil rig Haiyang Shiyou 981 in the South China Sea near the Hoang Sa Islands in May 2014 The location of China's rigs has been described as a disputed area by the international news, but both Vietnam and China argue that this is their sea and deny that there is a disagreement here Furthermore, China and Japan have a bitter conflict over the Senkaku and Ryukyu Islands; China has claimed sovereignty over sections of Nepal since the SinoNepalese war of 1788-1792; and China and North Korea have a dispute over Mount Baekdu and the Kando border area (Chinese call it Jiandao) when territorial disputes with countries in the region arise, as a global superpower, China will gain benefits in terms of geographical location, resources, and so on However, this is against international law, and it will have serious consequences for China When countries' relations become tense and they are unable to find a single voice to reach accords, China's economy will suffer long-term consequences c) Corruption It is undeniable that corruption is widespread in China In addition to looting and the buying and selling of military and government personnel, investigative reporters uncovered that prominent Chinese officials own major holdings in large corporations Without corruption and cronyism, China's transition to a market economy could become politically untenable Liberalizing the economy and opening up to international trade - one of the cornerstones to China's economic success – has been easier by providing government officials a piece of the economic growth pie However, as China develops into a more sophisticated and integrated economy, pervasive corruption will be detrimental rather than beneficial It is incredibly impossible to estimate the actual cost of corruption to a country the size of China's economy China's Corruption Perceptions Gauge (CPI - the leading global index of public sector corruption) was 39 in 2018, placing 87th out of 180 nations, and has been falling below the global average for several years, according to Transparency International Corruption has long existed in China, but its growing severity will result in significant economic losses, both directly through tax evasion, money laundering, and other illicit activities, and indirectly through market distortions, increased company costs, and hampered competition First and foremost, corruption will lead to a severe budget deficit If there is a tax evasion department or if taxes are reduced by bribes, the budget will be harmed Corruption, on the other hand, will lead to overspending on numerous social and industrial projects However, the budgetary consequences of corruption not end there: when the state faces a financial deficit, it must either cut social welfare programs or raise taxes, which have impacts on Chinese living standards The higher the tax, the slower economic activity becomes and the more non-bribe businessmen suffer Illicit financial flows to and from China totaled $1.1 trillion in 2014, far exceeding Russia's ($299 billion), India's ($122 billion), and Brazil's ($76 billion) totals Bribery is also a serious issue for China According to official government estimates, 17 officials imprisoned for corruption in 2018 took bribes for at least $1.47 million (10 million yuan) and five got bribes worth at least $14.7 million (100 million yuan) Bribes can also come into the hands of tax authorities, making it difficult for Beijing to eradicate tax evasion Tax evasion costs China $66.8 billion each year, according to the World Institute for Development Economics Corruption costs China some 10 percent of its gross domestic product (GDP), according to estimates by Shanghai-based independent economist Andy Xie Guozhong On the other hand, the relative lack of the rule of law and widespread government corruption in China limit competition and undermine the efficient allocation of goods and services in the economy In many cases, government "connections," not market forces, are the main determinant of successful firms in China Many U.S firms find it difficult to business in China because rules and regulations are generally not consistent or transparent, contracts are not easily enforced, and intellectual property rights are not protected (due to the lack of an independent judicial system) In the long run, some big businesses may reconsider their business in China and plan to invest in other countries From an economic standpoint, in order to ensure long-term economic progress, the arguments for combating corruption are greater than ever before China's economy is increasingly driven by the market rather than the state, according to Nicholas Lardy's persuasive analysis, and private enterprises will be a major source of growth in the years coming But, in order for this to happen, the private sector must be free from corruption Risks and Challenges The risks are principally related to the path of the pandemic globally and regionally and the possibility of renewed domestic outbreaks Delays in vaccination globally could lead to a more severe and durable pandemic, increase the possibility of repeated outbreaks even in China, slow the reopening of borders and the resumption of international travel, affect domestic production through limited imports of critical intermediate goods (such as chips) and lead to delays in the recovery of lagging services sectors China’s strong recovery has been partly attributed to its strict virus containment policies in the last year As immunization in China and the rest of the world progresses, maintaining too strict movement control policies and zero-tolerance COVID-19 suppression strategy could risk slowing down the recovery especially in the service sector Risks in China could also emanate from a wave of corporate bankruptcies and defaults, which could trigger financial market stress and derail the recovery COVID-19 has brought to the fore balance sheet vulnerabilities of corporates, banks, and government entities Corporate and household debt levels, already high before the pandemic, have risen further, eroding previous deleveraging gains and increasing financial stability risks A sudden rise in interest rates or abrupt policy or regulatory tightening for de-risking and deleveraging purposes could force struggling corporations and small and medium-sized enterprises (SMEs) into bankruptcy, trigger a cascade of defaults, and aggravate debt overhangs While system-wide buffers appear to be adequate to absorb shocks, and banks in the aggregate have robust buffers, vulnerabilities in smaller regional and local banks and fintech companies could intensify In addition, persistent policy uncertainty due to renewed economic tensions between major economies could dampen investor and consumer confidence Specifically, continued bilateral tensions between China and its key trading partners could weaken private investment demand and harm potential growth by restricting China’s access to imports of critical goods This, in turn, could further exacerbate the ongoing structural slowdown of potential growth Furthermore, China is plagued by issues such as Trade war, pollution, population crisis, corruption, and nonperforming loans For future sustainable development, the Chinese government must take swift action to address the aforementioned issues and mitigate potential threats SUMMARY From the analysis that we presented in the above sections, you can now get a better understanding of China from different perspectives, such as economy, living standard, weaknesses, strengths, and the policies that the governments implemented to solve numerous economical and social issues China is undoubtedly one of the world’s fastest growing countries with an average annual growth rate of roughly 7% in which the Services and Industry sectors accounted for the most part from 2010 to 2020 Furthermore, the scale of urbanization in China is without precedent in human history and twenty-five of the world’s largest 100 cities are in China China also saw an increase in total trades with many countries in the world and soon became the world’s largest exporter with trade surplus all over the last decade China’s major trading partners include the USA, the European Union, ASEAN, Japan, South Korea, Hong Kong and Taiwan In 2020, China was ranked the world's second largest FDI recipient after the United States The country is the largest recipient in Asia and the leading investing country in terms of FDI outflows In recent years, China has well controlled the inflation rate, with the figure fluctuating under the target ceiling Inflation in China hit its highest level in more than nine years as the coronavirus drove up demand for consumer goods and triggered business activity in parts of the country, but the country has implemented numerous effective policy to curb the pandemic and the inflation rate is expected to decrease soon after the country reach the “new normal” It could be drawn from this that China’s economy is still in control and could even expand larger in the next few years China’s living standard was reflected primarily in its HDI China’s HDI has increased over the last decade with the figure in 2020 amounted to 0.761, slightly higher than that of the world, which was 0.737 at that time Three components of HDI, namely life expectancy, education and per capita income all saw positive signs Although there existed some minor shortcomings, the country is likely put more effort into ỉmproving the current situation China’s strengths include its geographical location and territory, population and society, political system, military, science and technology and infrastructure However, there were still other weak points that needed to be looked at, namely the banking system, trade war, corruption and other minor problems One of the most impactful policies that China has introduced is the one-child policy It was put to use when China realized that its population had surpassed billion, an alarming number Initially, the one-child policy was meant to be a temporary measure and is estimated to have prevented up to 400 million births since it was instituted Ultimately, China ended its one-child policy realizing that too many Chinese were heading into retirement, and the nation's population had too few young people entering the labor force to provide for the older population's retirement, healthcare, and continued economic growth The one-child policy was officially discontinued in 2015 and the government attempted to replace it with a two-child policy The second policy that is mentioned in this essay is the social credit system, which was implemented in 2015 China's social credit system is a collection of databases and initiatives that track and assess the trustworthiness of individuals, businesses, and government entities Each entry is given a social credit score, with high scores receiving rewards and bad scores receiving punishment While the social credit system is questionable in certain ways, it worked effectively and had a good impact on citizens' behavior, causing the economy to grow swiftly The passage above has summarised the points that we consider and analyze in this essay with a view to systematizing and reordering the enormous amount of information about China This hopefully will give you a general picture and knowledge about almost all aspects of China in the period from 2010 to 2020 LESSONS FOR OUR VIETNAM The development model of the People’s Republic of China today has become a blueprint for development, despite its continued status as a developing nation While underdeveloped and developing nations have traditionally looked towards the United States and Western capitalist powers for inspiration in their quest for growth, the fast-paced development of China’s economy and technology in the last four decades have influenced many countries to formulate similar models, including our country, Vietnam Politics and the stability of the existing political system is often a direct factor in determining the development of any country Over the years, China’s stable and centralized political system has been credited with the systematic development since the introduction of the first five-year development plan This has led to the belief that slow development experienced by countries with multiparty systems are a result of the lack of consensus between political parties over the country’s development policies Today, under the leadership of Chinese President Xi Jinping, China is playing an important role as a global power in the international arena In recent times, the Chinese have successfully transformed their economy, which is based on the socialist market system to align with the ambitions of this century Vietnam has also implemented this system and is still on the way to effectively bring about the greatest outcomes The Chinese economy had embarked on a new journey through the “reform and opening up” policies Introducing a socialist economic model through these reforms, industrialization and urbanization soon accelerated in China, which in turn kick-started the rapid development of its economy As its development journey continued, in 2012, China was able to clinch the second spot in the world in terms of GDP, resulting in China evolving from a low-income country to a middle-income country within the last 40 years It’s “reform and opening up” policies not only developed the Chinese economy but also ensured the rapid development in the fields of industry, technology, agriculture, social development and transport Meanwhile, China has made tremendous strides in its technology, construction and transport fields A market in which Chinese products cannot be found is unheard of, especially in the technology sector The same goes for the construction field Chinese companies carrying out construction projects in third world countries are a common phenomenon The country’s development in the transport sector is perhaps best reflected through its high-speed rail network, which is the largest of its kind in the world By mid-2018, the total length of China's high-speed railway network reached an astounding 27,000 kilometers China has also managed to add high-speed trains to its network, which travel at speeds of up to 400 kilometers per hour These are some of the many lessons that our country should learn from China in order to boost our economic growth and living standard Aside from looking at China’s advantages, we should also analyze its shortcomings in other aspects that we have previously presented above such as education, cost of living, bureaucracy, etc and reflect on our own performance to bridge the gap REFERENCES  Katina Stefanova ( 2017 ) China's Rising Wealth Gap And Implications To Markets And The World Forbes  Bloomberg ( 2018 ) China Has A $43,000 Wealth Gap Problem The Los Angeles Times  Heather Long ( 2015 ) China Will Hold Global Economy Back In 2016 CNN  Sara Hsu ( 2016 ) High Income Inequality Still Festering In China Forbes  Liu Jing ( 2015 ) Study Shows Chinese Students Spend Three Hours On Homework Per Day Chinadaily  Tony Degennaro ( 2020 ) Education In China: The Good, The Bad & The Big Opportunities Dragonsocial  Kanoko Matsuyama ( 2019 ) Increasing Wealth Is Changing The Way People Die In China Mint  ( 2019 ) Enhancing Financial Protection Under China’s Social Health Insurance To Achieve Universal Health Coverage Thebmj  Ding Gang (2019 ) China Needs To Focus On Social Welfare Globaltimes  Laura He ( 2019 ) China Takes More Action To Boost Its Slowing Economy CNN  Christopher Needham ( 2013 ) Social Welfare Protection: The Eu, Usa And China Library Briefing  Daniel Shane ( 2017 ) More Debt Helps China Keep Its Economy Humming CNN  Lindsay Maizland ( 2020 ) China’s Fight Against Climate Change And Environmental Degradation Council Foreign Relations  Sophie Jeong ( 2020 ) Exhausted And Without 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South China Morning Post  Jessica Reily, Muyao Lyu, And Megan Robertson (2020) China’s Social Credit System: Speculation Vs Reality The Diplomat  Kevin Hong (2019) The Complicated Truth About China’s Social Credit System Wired.co.uk  An Binh (2019) China’s Economy Is Strong Affected By Trade War, Resulting In The Lowest Growth In 27 Years Dantri.com.vn ... Of China In The Period 2010- 2020 (In Million Inhabitants) The adverse effects of having a widening inequity between the rich and the poor include social and political instability, discrimination... experienced the fastest growth in the number of trades with China ASEAN overtook the EU to be China? ??s top trading partner in 2020, after increasing percent year-on-year and accounting for 15% of China? ??s... urban income is fast increasing, rural income is slowly increasing, expanding the disparity between the two groups In 2020, the annual per capita disposable income of rural households in China