Over the recent years, China in all kinds of reports of mass media has an image of future super-country, and it seemed that the 21st century for China could not be more promising. Optimistic forecasts said that, in the years 2020-2030, China’s GDP will be N0.1 in the world, and average GDP will catch the current developed countries; up to the end of the 21st century, average GDP will catch up with the then developed countries. The author of the report claimed heroically and firmly that the 21st century will be the century for China’s prosperation. Now it is already the twelfth year of the 21st century and where is China’s economy now?
China’s economy is important not only because it has the largest population in the world and any small movement can give rise to a storm that threaten the lives of millions of people, but also because it has so many trade relations with many other countries so that an unexpected event in China may induce a series of problems to the whole world. In 2012, a year when China economy was gradually recovering from the 2008 world economy crisis, the Euro debt crisis is again coming. The world economy developed at a slower pace, and both external and internal factors are asking China to quicken the adjustment of economic structure. The expected GDP growth for 2012 is around 8.5%, while the expected CPI growth is about 3.5%.
The 2008 economy crisis brought impact to world economy, and traditional developed economic powers like the European Union and the United States we forced to give a second thought to the old theories and try to adopt new economic rules. China also needed adjustment.
The external driving force this year is mainly because of the Euro debt crisis. The worsening of European economy make the fictitious economy to recess and pushed the real economy into stagnation, which again reminds the western countries of the importance to have the fictitious and real economy develop at the same step. From 2008 on, America has taken various measures to limit their import from China to lessen the competition pressure on their native industry and force China to open its market more.
Internally, the problem lies in the unsteady foundation of economy due to unbalanced development.Cash flow and technology has become two major obstacles. the two most obvious problems are: the types of China’s export products are not well-distributed, so most firms are engaging in producing energy and resource-wasting but lower-class half-products; the continuously growing foreign reserve drives the price higher and higher, and finally lead to the fast inflation, which threatens the safety of society.
To acquire further development in the future, China should switch its extensive economic growth mode to an intensive one. China should focus on internal market needs, stimulate the potential of its people’s consumption potentialities. Also China should let more foreign companies enter its market. A crisis is not only a threat but also an opportunity. Foreign competitors will bring both money and technology, and also force Chinese firms to fasten their pace in reforming and innovating.