Future of China in 2030

Group Members

Guy Kedar
Gerrit Ledderhof
Chia Wei Lee
Johanna Little
Geoff Spielman

Introduction

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• You guys might want to look at articles published by Bobo Lo, he writes on Russia but also Russo-Chinese relations. Andrei.

Research Questions

• China by the Numbers
• Numbers that Matter Presentation

Government and Politics

• What is the reality of the current political system (is it really communist)?
• What is current foreign policy?
• What is China’s sphere of influence?
• Who does China currently consider as allies/enemies?
• How does China view its role within the world? Superpower?
• Could China survive democracy?

Since the conservative elements of the communist party took power, the country has moved closer and closer to democratization. This can be seen in privatization of land, increased benefits for better working performance. The concessions were made to help China rapidly catch-up with the industrial nations. While it is questionable if the voting system will work at present the country seems to be moving in a democratic direction.

• Will china join ASEAN?

China has been entering talks to with ASEAN to improve relations

• What is the role of women in Chinese government?

There are 21 Women in senior government roles, however, non are in the Politburo.

Economics

What is the industrial structure of China by GDP?

Agriculture: 11.3%; industry: 48.6%; services: 40.1%

What is the composition of labor force by occupation in China?

Agriculture: 43%; industry: 25%; services: 32%

What are the positive performances of China in economic fields in recent years?

Firstly, the domestic demand rose on a sustainable basis. Meanwhile, investment in fixed assets increased rapidly and consumer demand grew steadily and relatively rapidly. Secondly, industries above the designated size registered month-on-month growth. Thirdly, the purchase management index and the entrepreneur confidence index of the manufacturing industry both rose, indicating that the Chinese economy has begun to stabilize and recover in some fields. And fourthly, the market confidence went up and the economy became more active over the first three months, with increases in both the stock market and housing market transaction volumes.

What are the main problems in China's economy?

• Effectively funding an economic stimulus package.
• The motivation for structural adjustment is also weak. In particular, the internal drive to transform and upgrade the industrial structure is not strong enough.
• The gap between excessive production and insufficient market demand has widened.
• Invalid injections of capital continue to increase. In particular, the injection of credit has structural problems, and may impose restrictions on future economic growth: the financial environment for small and medium enterprises has not improved; the proportion of credit available for consumers is relatively low.

What kind of economic development challenges does the Chinese government face?

• Strengthening its social safety net, including pension and health system reform, to counteract a high domestic savings rate and correspondingly low domestic demand.
• Sustaining adequate job growth for tens of millions of migrants, new entrants to the work force, and workers laid off from state-owned enterprises deemed not worth saving.
• Reducing corruption and other economic crimes.
• Containing environmental damage and social strife related to the economy's rapid transformation.

What industries will be the biggest source for economic growth going forward?

Manufacturing and tertiary industry are the driving force behind economic growth. Tertiary industry is the new fast-growing sector of the economy and is playing a leading role in creating jobs.

Will China become a post-industrialized society in the near future and if so how will it make this transition?

What are the implications if China’s growth slows (i.e., potential starvation etc.)?

Will China continue to be dependent on other countries for economic growth or will domestic demand increase in the near future?

Society and Culture

Unanswered Questions

• Are there any current issues that are causing social unrest?
• How will the income disparity in China affect its future?
• Will the growing difference in ratio of men to women have a negative impact on China’s future?
• What aspects of China’s culture will be the strongest driving forces in the country’s future?

What is China's size? Some 9.6 million squared kilometers, located on the western shore of the Pacific ocean and enjoys coastline as well as inland landscapes.

What is China's climate? China has a continental climate and a span of nearly 50 degrees. Most of the land is located in a temperate zone, while the north is frigid and the south tropical and sub tropical. The country's wide range of climates includes areas that have long winters and no summer, areas that have only summer and such that experience distinctive seasonal changes. Monsoons are the major source of rainfall in China throughout the year.

What can be learned on China through its national symbols? Underlying characteristics of the Chinese culture can be found in its national symbols:

• The Chinese flag reflects four equal classes gathered around the communist party. The red colour is said to represent the revolution and the yellow stands for golden brilliant rays. (as well as the Chinese skin colour).
• The national anthem is the "March of the Volunteers". It was composed to reflect a strong belief and confidence of the Chinese in defeating the invading Japanese. Along the years the anthem was claimed to arouse patriotism, express the morale of the Chinese in revolution and act as a reminder that danger lies also in times of peace.
• The national emblem demonstrates richness and grandeur of the People's Republic of China.
• The national flower, the Tree Peony, is also said to represent the characters of the Chinese people.

Environment

Below are the short answers for each question. For more information on these answers please select the following link: Environmental Research Questions - China in 2030

What are the key drivers behind China's current environmental state?

The driving factors behind China’s environmental problems include an increase in the number of households, increased urbanization, explosive economic growth, failure to execute environmental policy, lack of public awareness and prioritization of economic growth over sustainability.

What impact have these key drivers had on the environment?

These key drivers have caused air pollution, acid rain, loss of agricultural land, forest deficiency, poor water quality, water scarcity, ocean coastline pollution, and loss in biodiversity.

What impact have these poor environmental conditions had on China?

China's current poor environmental situation causes great socioeconomic loss, increases the nation's health costs, more frequent and damaging natural disasters, and increasing social inequities. For example, the losses from pollution and ecological damage ranged from 7% to 20% of GDP every year in the past two decades. From 1996 to 2001, China's spending on public health increased by 80%, or more than 13% per year in part to cope with environmental problems. The number of mass protests caused by environmental issues has grown by 29% every year. Finally, droughts, floods, and other natural disasters have become increasingly frequent and damaging causing great financial losses as well as that of human life.

What are China's most significant environmental obstacles going forward?

China's largest obstacles to improve the environment lie in its failure to execute environmental policies, prioritization of economic growth over environmental protection, lack of public awareness, and continued economic growth. China has developed numerous environmental laws and policies, but most of them are just on paper. Furthermore, many environmental laws and regulations were written largely piecemeal, lack effective implementation and evaluation of long-term consequences, and need a systems approach. (PBS, 2006)

How will the state of China's environment affect the country's future (and the world's future)?

The increasing number of households, population growth, and growing affluence and consumption will continue to have detrimental effects on the environment. Additionally, having the world's largest population and fastest-growing economy means that China's actions also heavily affect the rest of the world. Total production or consumption is the product of population size times per capita production or consumption rate. China’s achievement of developed-world consumption standards will approximately double the world’s human resource use and environmental impact. This is why China’s environmental problems are the world’s.

What will China's environmental policy be going forward?

Recognizing the environmental challenges the country faces, the Chinese government is hoping to build an environmentally-friendly society, and has set very ambitious environmental goals. By 2020, China plans to significantly improve environmental quality and ecological conditions. Still, China's economic goal is to double its GDP by 2020, and we've seen from the past two decades that economic goals tend to be well surpassed while environmental goals are left largely unattended to. (PBS, 2006)

China is also increasingly assuming responsibilities on the world stage by participating in environmental treaties. Public awareness for the environment has improved and China has been pushing hard for cleaner production and sustainable development. China is also designing and adopting a green accounting system that includes environmental costs in the calculation of gross domestic product (or Green GDP).

Driving Forces

New Forces

The following forces were determined by our group:

Political Driving Forces

• Decreasing acceptance of central government in China

Environmental Driving Forces

• Increase in the number of households in China
• Increasing water scarcity in China
• Desertification of China
• Increased private sector in China

Societal Driving Forces

• Increase in travel infrastructure in China
• Strict internet censorship in China

Economic Driving Forces

• Rising costs of labour in China

After effect of the 2008 economic crisis

Technological Driving Forces

• Increase of information sharing through Web 2.0
• The "flattening" of the world

Existing Forces

The following forces are already existing on the wiki that are explicitly related to China.

Political Driving Forces

• An Open China
• Easing restrictions in China
• Economic Growth in China
• Strike in China
• Host to the 2008 Olympic Games Beijing,china

Economic Driving Forces

• Chinese Families' economic condition
• Economic Growth in China
• Huge difference between the western and the eastern part of China
• Energy crisis in Asia
• The Rise of BRIC Economies
• China's economic productivity growth
• China's accumulated capital as the driving force of the economic growth
• China becoming the largest economy
• Increasing income disparity in China

Societal Driving Forces

• Chinese people's increasing leisure time
• Population of China

Environmental Driving Forces

• Increased environmental degradation in China

Systems Diagram

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  Systems diagram picture 1

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  Systems diagram picture 2

Scenarios

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  Scenarios - 1st draft

References

Websites

1. Political History: http://acc6.its.brooklyn.cuny.edu/~phalsall/texts/chinhist.html
2. General History: http://www-chaos.umd.edu/history/toc.html

Videos

1. Frontline. 2006. Young and Restless in China.
2. Washington Post. 2006. Redefining China's Family.
3. Financial Times. 2009. NATHAN ANDERSON, UBS, on the future of China economic policy Video.

News and Journal Articles

1. Jun, Ma. (2007). How participation can help China's ailing environment. Available: http://www.chinadialogue.net/article/show/single/en/733-How-participation-can-help-China-s-ailing-environment
   
2. PBS. (2006). China's Environmental Future. Available: http://www.pbs.org/kqed/chinainside/nature/environment.html.
3. Liu, J. & Diamond, J.. (2005). China's Place in the World: Environmental Impact of a Giant. Available: http://www.csis.msu.edu/Publication%20files/China_Environment_Globalization.pdf
4. People's Daily Online. 11 September 2009. Will China's economic growth change the world economic pattern? Available: http://english.people.com.cn/90001/90780/91344/6755577.html

Previous Scenarios

1. Future of China in 2020
2. The Future of the Internet in China 2015
3. http://www.weforum.org/pdf/scenarios/China_report.pdf
4. http://money.cnn.com/magazines/business2/business2_archive/2006/08/01/8382233/index.htm
5. http://www3.brookings.edu/views/articles/li200707.pdf

Recommended Reading

1. Shen, Sandy. (2008). Innovation Is Reshaping China's Economy. Gartner. G00157000.
2. Motley Fool. 2008. Will China Starve the World?
3. The New York Times. 2008. Missile-ready China warns U.S. against plan to destroy spy satellite
4. Wired. 2008. How China Loses the Coming Space War (Pt. 1)
5. Pei, Minxin. (2007). Corruption Threatens China’s Future. Carnegie: Endowment for International Peace. Policy Brief 55
6. Bloom, Erik, Vincent de Wit, and Mary Jane Carangal-San Jose. 2005. Potential Economic Impact of an Avian Flu Pandemic on Asia. ERD Policy Brief Series No. 42. Manila : Asian Development Bank. November.
7. Brahm, Laurence J. 2001. China’s Century: The Awakening of the Next Economic Powerhouse. Singapore: John Wiley & Sons (Asia) Pte Ltd.
8. Zhang, Zeng, Mako & Seward. 2009. Promoting Enterprise-Led Innovation in China. The World Bank.
9. Miaojie, Yu. 2009. Global Times. Domestic markets can't sustain China's growth
10. The Economist. 2009. China and the West: A time for muscle-flexing
11. National Geographic. 2008. China's Journey
12. Chen, Kun, and Martin Kenney. 2005. University/Research Institute-Industry Linkages in Two Chinese Cities : Commercializing Technological Innovation. To be presented at “Universities as Drivers of the Urban Economies in Asia” sponsored by the World Bank and Social Research Council. 24-25 May.
13. Courrier International. 2005. La Chine des Chinois. Hors-Série, Juin-Juillet-Août. France.
14. Crane, Keith, Roger Cliff, Evan Medeiros, James Mulvenon, and William Overholt. 2005. Modernizing China’s Military: Opportunities and Constraints. RAND Corporation.
15. Economy, Elizabeth C. 2004. The River Runs Black: The environmental challenge to China’s future. Ithaca & London: Cornell University Press.
16. Hale, David (Hale Advisers, LLC). 2005. China’s Currency Conundrum. Central Banking Volume XVI No.1. London: Central Banking Publications.
17. Smil, Vaclav. 2004. China’s Past, China’s Future: energy, food, environment. New York, NY and Great Britain : RoutledgeCurzon.
18. UBS Securities Asia Ltd, UBS Investment Research. 2005. How to Think About China. Asian Economic Perspectives. Hong Kong. 6 January.
19. Morgan Stanley Equity Research. 2004. New Tigers of Asia. India and China: A Special Economic Analysis. Asia/Pacific, 26 July.
20. Orr, Gordon R. 2004. The aging of China. The McKinsey Quarterly 2004 special edition: China today.
21. Clifford Coonan.10 Mar.2006. "China’s Boom is Killing Sea That Gives It Life, Warn Scientists." Independent News and Media Limited.