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China- The Report INDIAN INSTITUTE OF PLANNING AND MANAGEMENT
CHENNAI – 08

amlan.ray@iipm.edu

CHINA – THE REPORT

Submitted by, Anburaaja 04 Murugan 09 Karthikeyan 11 Yusuf Mohamad 41 Saravana Pandian 49

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ACKNOWLEGEMENT
We would like to thank the IIPM(INDIAN INSTITUTE of PLANNING AND MANAGEMENT) for giving us this opportunity to explore our knowledge in the field of Comparative Economic Systems. we would consider it as a great privilege to do this report under the guidance of Prof. Amlanray, we sincerely thank him for his invaluable support, guidance and suggestions. We thank each and all who as contributed for making this report as success. The Team....
Saravana Pandian Karthikeyan Murugan Anburaaja Yusuf Mohamad

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Contents
ACKNOWLEGEMENT......................................................................................... ...........2 We would like to thank the IIPM(INDIAN INSTITUTE of PLANNING AND MANAGEMENT) for giving us this opportunity to explore our knowledge in the field of Comparative Economic Systems. we would consider it as a great privilege to do this report under the guidance of Prof. Amlanray, we sincerely thank him for his invaluable support, guidance and suggestions. We thank each and all who as contributed for making this report as success. ...........................................................................................2 The Team................................................................................................ ....................2 History..................................................................................................... ...................3 GENERAL INFORMATIONS :.......................................................................................10 Economic summary: ................................................................................................11 Economy in detail.................................................................................. ...................14

History

The earliest recorded human settlements in what is today called China were discovered in the Huang He basin and date from about 5000 B.C. During the Shang dynasty (1500–1000 B.C.), the precursor of modern China's ideographic writing system developed, allowing the emerging feudal states of the era to achieve

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an advanced stage of civilization, rivaling in sophistication any society found at the time in Europe, the Middle East, or the Americas. It was following this initial flourishing of civilization, in a period known as the Chou dynasty (1122–249 B.C.), that Lao-tse, Confucius, Mo Ti, and Mencius laid the foundation of Chinese philosophical thought. The feudal states, often at war with one another, were first united under Emperor Ch'in Shih Huang Ti, during whose reign (246–210 B.C.) work was begun on the Great Wall of China, a monumental bulwark against invasion from the West. Although the Great Wall symbolized China's desire to protect itself from the outside world, under the Han dynasty (206 B.C.–A.D. 220), the civilization conducted extensive commercial trading with the West. China remained largely isolated from the rest of the world's civilizations, closely restricting foreign activities. By the end of the 18th century only Canton (location of modern-day Hong Kong) and the Portuguese port of Macao were open to European merchants. But with the first Anglo-Chinese War in 1839–1842, a long period of instability and concessions to Western colonial powers began. Following the war, several ports were opened up for trading, and Hong Kong was ceded to Britain. Treaties signed after further hostilities (1856–1860) weakened Chinese sovereignty and gave foreigners immunity from Chinese jurisdiction. European powers took advantage of the disastrous Sino-Japanese War of 1894–1895 to gain further trading concessions from China. Peking's response, the Boxer Rebellion (1900), was suppressed by an international force. On Sept. 18, 1931, Japan launched an invasion of Manchuria, capturing the province. Tokyo set up a puppet state dubbed Manchukuo and installed the last Manchu emperor, Henry Pu-Yi (Hsüan T'ung), as its nominal leader. Japanese

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troops moved to seize China's northern provinces in July 1937 but were resisted by Chiang, who had been able to use the Japanese invasion to unite most of China behind him. Within two years, however, Japan had seized most of the nation's eastern ports and railways. The Kuomintang government retreated first to Hankow and then to Chungking, while the Japanese set up a puppet government at Nanking, headed by Wang Jingwei. In 1959, a failed uprising against China's invasion and occupation of Tibet forced Tibetan Buddhism's spiritual leader, the Dalai Lama, and 100,000 of his followers to flee to India. The invasion of Tibet and a perceived rivalry for the leadership of the world Communist movement caused a serious souring of relations between China and the USSR, former allies. In 1965 Tibet was formally made an autonomous region of China. China's harsh religious and cultural persecution of Tibetans, which continues to this day, has spawned growing international protest. The failure of the Great Leap Forward touched off a power struggle within the Chinese Communist Party between Mao and his supporters and a reformist faction including future premier Deng Xiaoping. Mao moved to Shanghai, and from that base he and his supporters waged what they called the Cultural Revolution. Beginning in the spring of 1966, Mao ordered the closing of schools and the formation of ideologically pure Red Guard units, dominated by youths and students. The Red Guards campaigned against “old ideas, old culture, old habits, and old customs.” Millions died as a series of violent purges were carried out. By early 1967, the Cultural Revolution had succeeded in bolstering Mao's position as China's paramount leader. Anxious to exploit the Sino-Soviet rift, the Nixon administration made a dramatic announcement in July 1971 that National Security Adviser Henry Kissinger had

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secretly visited Beijing and reached an agreement whereby Nixon would visit China. The movement toward reconciliation, which signaled the end of the U.S. containment policy toward China, provided momentum for China's admission to the UN. Despite U.S. opposition to expelling Taiwan (Nationalist China), the world body overwhelmingly voted to oust Taiwan in favor of Beijing's Communist government. President Nixon went to Beijing for a week early in 1972, meeting Mao as well as Zhou. The summit ended with a historic communiqué on Feb. 28, in which both nations promised to work toward improved relations. Full diplomatic relations were barred by China as long as the U.S. continued to recognize the legitimacy of Nationalist China. In 1981, Deng protégé Hu Yaobang replaced Hua Guofeng as party chairman. Deng became chairman of the Central Committee's military commission, giving him control over the army. The body's 215 members concluded the session with a statement holding Mao Zedong responsible for the “grave blunder” of the Cultural Revolution. Deng Xiaoping's death in Feb. 1997 left a younger generation in charge of managing the enormous country. In 1998, Prime Minister Zhu Rongji introduced a sweeping program to privatize state-run businesses and further liberalize the nation's economy, a move lauded by Western economists. In Aug. 1999, China rounded up thousands of members of the Falun Gong sect, a highly popular religious movement. The government considers the apolitical spiritual group threatening because its numbers exceeded the membership of the Chinese Communist Party. China severely restricts its citizens' civil, religious, and

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political rights. The use of torture has been widely documented, and for many years it has executed more people than any other country in the world, carrying out more than three-quarters of the world's executions. China was admitted to the World Trade Organization in Nov. 2001. Its entry ended a 15-year debate over whether China is entitled to the full trading rights of capitalist countries. After months of pressure from the Bush administration, China announced in July 2005 that it will no longer peg the yuan to the dollar. Instead, the yuan is linked to a fluctuating group of foreign currencies. The police shot and killed about 20 people who were protesting the construction of a power plant in the southern city of Dongzhou in December. Chinese officials blocked the spread of information about the event. In May 2006, China completed construction on the Three Gorges Dam, the largest hydroelectric dam in the world. More than a million people will be displaced when the area is flooded. In July 2006, China opened a $4.2-billion, 710-mile-long railway from Qinghai Province to the Tibetan capital of Lhasa. The highest railway in the world, it ascends as high as 16,500 ft, requiring all compartments to have regulated oxygen levels. The railway will increase ethnic Chinese migration into Tibet, which many see as a deliberate attempt to dilute Tibetan culture. In the spring and summer of 2007, dog food and toothpaste products that originated in China were recalled due to the presence of poisonous ingredients, leading many to question the safety of Chinese products and the reliability of its regulatory system. In July, China's former head of the State Food and Drug

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Administration was executed for accepting bribes from pharmaceutical companies in exchange for favors.

National Flag: The national flag of China
was adopted at the First Plenary Session of the Chinese People's Political Consultative Conference held in September 1949, shortly before the founding of the People's Republic of China. The flag of the People's Republic of China is red in color and it has five yellow stars. The color red symbolizes the spirit of the revolution, and the five stars signify the unity of the people of China under the leadership of the Chinese Communist Party. The flag first went up in Tiananmen Square on October1, 1949, upon the formal announcement that People's Republic of China was founded.

National Emblem: The design of the national emblem of the People's
Republic of China, published by September 20, 1950, shows stars, and it is framed with ears Tiananmen is the symbol of the Central People's Government on Tiananmen under the light of five of grain and cogwheel. modern China because the May

4th Movement of 1919, which marked the beginning of the new-democratic revolution in China, was launched there. It is also the place where the inauguration of the People's Republic of China was held. The cogwheel and the ears of grain represent the working class and the peasantry respectively, and the five stars symbolize the solidarity of the various nationalities of China. The emblem clearly indicates that People's Republic of China is a socialist state led by the working class and based on the alliance of the workers and the peasants.

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National Anthem: The words for the national anthem were written by
Tian Han, and the music was set by Nie Er in 1935. Originally known as the March of the Volunteers, it was the theme song of The Sons and Daughters in Times of Turmoil, a film that depicted how Chinese intellectuals marched bravely to the front in the War of Resistance Against Japan during the Second World War. Sonorous, militant and inspiring, the song describes the wrath of the Chinese people against imperialist aggression and their determination to protect their motherland against foreign, invaders. During the Second World War it was also sung by people of other countries who sympathized with the Chinese people in their anti-Japanese struggle. In 1949 it was appropriately chosen to be the national anthem of the People's Republic of China. The lyrics of the national anthem are as follows: Arise, ye who refuse to be slaves; With our very flesh and blood Let us build our new Great Wall! The Peoples of China are in the most critical time, Everybody must roar his defiance. Arise! Arise! Arise! Millions of hearts with one mind, Brave the enemy's gunfire, March on!

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Brave the enemy's gunfire, March on! March on! March on, on !

GENERAL INFORMATIONS :
Land area: 3,600,927 sq mi (9,326,411 sq km); total area: 3,705,407 sq mi (9,596,960 sq km)1 Population (2007 est.): 1,321,851,888 (growth rate: 0.6%); birth rate: 13.5/1000; infant mortality rate: 22.1.1/1000; life expectancy: 72.9; density per sq mi: 367 Capital : Beijing, 10,849,000 (metro. area), 8,689,000 (city proper) Largest cities: Shanghai, 12,665,000 (metro. area), 10,996,500 (city proper); Tianjin (Tientsin), 9,346,000 (metro. area), 4,333,900 (city proper); Wuhan, 3,959,700; Shenyang (Mukden), 3,574,100; Guangzhou, 3,473,800; Haerbin, 2,904,900; Xian, 2,642,100; Chungking (Chongquing) 2,370,100; Chengdu, 2,011,000; Hong Kong (Xianggang), 1,361,200 Monetary unit: Yuan/Renminbi Languages: Standard Chinese (Mandarin/Putonghua), Yue (Cantonese), Wu (Shanghaiese), Minbei (Fuzhou), Minnan (Hokkien-Taiwanese), Xiang, Gan, Hakka dialects, minority languages Ethnicity/race: Han Chinese 91.9%, Zhuang, Uygur, Hui, Yi, Tibetan, Miao, Manchu, Mongol, Buyi, Korean, and other nationalities 8.1%

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Religions: Officially atheist; Daoist (Taoist), Buddhist, Christian 3%–4%, Muslim 1%–2% (2002 est.) Literacy rate: 86% (2003 est.)

Economic summary:
GDP/PPP (2006 est.): $10.17 trillion; per capita $7,700. Real growth rate: 10.7% (official data). Inflation: 1.5%. Unemployment: 4.2% official registered unemployment in urban areas in 2004; substantial unemployment and underemployment in rural areas; an official Chinese journal estimated overall unemployment (including rural areas) for 2003 at 20% (2004). Arable land: 15%. Agriculture: rice, wheat, potatoes, corn, peanuts, tea, millet, barley, apples, cotton, oilseed; pork; fish. Labor force: 798 million (2006); agriculture 45%, industry 24%, services 31% (2006 est.). Industries: mining and ore processing, iron, steel, aluminum, and other metals, coal; machine building; armaments; textiles and apparel; petroleum; cement; chemicals; fertilizers; consumer products, including footwear, toys, and electronics; food processing; transportation equipment, including automobiles, rail

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cars and locomotives, ships, and aircraft; telecommunications equipment, commercial space launch vehicles, satellites. Natural resources: coal, iron ore, petroleum, natural gas, mercury, tin, tungsten, antimony, manganese, molybdenum, vanadium, magnetite, aluminum, lead, zinc, uranium, hydropower potential (world's largest). Exports: $974 billion f.o.b. (2006 est.): machinery and equipment, plastics, optical and medical equipment, iron and steel. Imports: $777.9 billion f.o.b. (2006 est.): machinery and equipment, oil and mineral fuels, plastics, optical and medical equipment, organic chemicals, iron and steel. Major trading partners: U.S., Hong Kong, Japan, South Korea, Germany, Taiwan (2004). Communications: Telephones: main lines in use: 350.43 million (2005); mobile cellular: 437.48 million (2006). Radio broadcast stations: AM 369, FM 259, shortwave 45 (1998). Television broadcast stations: 3,240 (of which 209 are operated by China Central Television, 31 are provincial TV stations and nearly 3,000 are local city stations) (1997). Internet hosts: 232,780 (2006). Internet users: 123 million (2006). Transportation: Railways: total: 71,898 (2002).

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Highways: total: 1,870,661 km; paved: 1,515,797 km (with at least 34,288 km of expressways) ; unpaved: 354,864 km (2004). Waterways: 123,964 km (2003). Ports and harbors: Dalian, Guangzhou, Nanjing, Ningbo, Qingdao, Qinhuangdao, Shanghai. Airports: 486 (2006 est.). International disputes: in 2005, China and India initiate drafting principles to resolve all aspects of their extensive boundary and territorial disputes together with a security and foreign policy dialogue to consolidate discussions related to the boundary, regional nuclear proliferation, and other matters; recent talks and confidence-building measures have begun to defuse tensions over Kashmir, site of the world's largest and most militarized territorial dispute with portions under the de facto administration of China (Aksai Chin), India (Jammu and Kashmir), and Pakistan (Azad Kashmir and Northern Areas); India does not recognize Pakistan's ceding historic Kashmir lands to China in 1964; about 90,000 ethnic Tibetan exiles reside primarily in India as well as Nepal and Bhutan; China asserts sovereignty over the Spratly Islands together with Malaysia, Philippines, Taiwan, Vietnam, and possibly Brunei; the 2002 "Declaration on the Conduct of Parties in the South China Sea" has eased tensions in the Spratlys but is not the legally binding "code of conduct" sought by some parties; in March 2005, the national oil companies of China, the Philippines, and Vietnam signed a joint accord on marine seismic activities in the Spratly Islands; China occupies some of the Paracel Islands also claimed by Vietnam and Taiwan; China and Taiwan have become more vocal in rejecting both Japan's claims to the uninhabited islands of Senkaku-shoto (Diaoyu Tai) and Japan's unilaterally declared exclusive economic zone in the East China Sea, the site of intensive hydrocarbon prospecting; certain islands in the Yalu and

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Tumen rivers are in an uncontested dispute with North Korea and a section of boundary around Mount Paektu is considered indefinite; China seeks to stem illegal migration of tens of thousands of North Koreans; in 2004, China and Russia divided up the islands in the Amur, Ussuri, and Argun Rivers, ending a century-old border dispute; demarcation of the China-Vietnam boundary proceeds slowly and although the maritime boundary delimitation and fisheries agreements were ratified in June 2004, implementation has been delayed; environmentalists in Burma and Thailand remain concerned about China's construction of hydroelectric dams upstream on the Nujiang/Salween River in Yunnan Province.

Economy in detail
Although China is still a developing country with a relatively low per capita income, it has experienced tremendous economic growth since the late 1970s. In large part as a result of economic liberalization policies, the GDP quadrupled between 1978 and 1998, and foreign investment soared during the 1990s. China's challenge in the early 21st cent. will be to balance its highly centralized political system with an increasingly decentralized economic system. Agriculture is by far the leading occupation, involving over 50% of the population, although extensive rough, high terrain and large arid areas—especially in the west and north—limit cultivation to only about 10% of the land surface. Since the late 1970s, China has decollectivized agriculture, yielding tremendous gains in production. Even with these improvements, agriculture accounts for only 20% of the nation's gross national product. Except for the oasis farming in Xinjiang and Qinghai, some irrigated areas in Inner Mongolia and Gansu, and sheltered valleys in Tibet, agricultural production is restricted to the east. China is the world's largest producer of rice and wheat and a major producer of sweet

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potatoes, sorghum, millet, barley, peanuts, corn, soybeans, and potatoes. In terms of cash crops, China ranks first in cotton and tobacco and is an important producer of oilseeds, silk, tea, ramie, jute, hemp, sugarcane, and sugar beets. Livestock raising on a large scale is confined to the border regions and provinces in the north and west; it is mainly of the nomadic pastoral type. China ranks first in world production of red meat (including beef, veal, mutton, lamb, and pork). Sheep, cattle, and goats are the most common types of livestock. Horses, donkeys, and mules are work animals in the north, while oxen and water buffalo are used for plowing chiefly in the south. Hogs and poultry are widely raised in China, furnishing important export staples, such as hog bristles and egg products. Fish and pork supply most of the animal protein in the Chinese diet. Due to improved technology, the fishing industry has grown considerably since the late 1970s. China is one of the world's major mineral-producing countries. Coal is the most abundant mineral (China ranks first in coal production); high-quality, easily mined coal is found throughout the country, but especially in the north and northeast. There are also extensive iron-ore deposits; the largest mines are at Anshan and Benxi, in Liaoning province. Oil fields discovered in the 1960s and after made China a net exporter, and by the early 1990s, China was the world's fifth-ranked oil producer. Growing domestic demand beginning in the mid-1990s, however, has forced the nation to import increasing quantities of petroleum. Offshore exploration has become important to meeting domestic needs; massive deposits off the coasts are believed to exceed all the world's known oil reserves. China's leading export minerals are tungsten, antimony, tin, magnesium, molybdenum, mercury, manganese, barite, and salt. China is among the world's four top producers of antimony, magnesium, tin, tungsten, and zinc, and ranks

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second (after the United States) in the production of salt, sixth in gold, and eighth in lead ore. There are large deposits of uranium in the northwest, especially in Xinjiang; there are also mines in Jiangxi and Guangdong provs. Alumina is found in many parts of the country; China is one of world's largest producers of aluminum. There are also deposits of vanadium, magnetite, copper, fluorite, nickel, asbestos, phosphate rock, pyrite, and sulfur. Coal is the single most important energy source; coal-fired thermal electric generators provide over 70% of the country's electric power. China's exploitation of its high-sulfur coal resources has resulted in massive pollution. China also has extensive hydroelectric energy potential, notably in Yunnan, W Sichuan, and E Tibet, although hydroelectric power accounts for only 5% of the country's total energy production. Hydroelectric projects exist in provinces served by major rivers where near-surface coal is not abundant. The largest completed project, Gezhouba Dam, on the Chang (Yangtze) River, opened in 1981; the Three Gorges Dam, the world's largest engineering project, on the lower Chang, is scheduled for completion in 2009. Beginning in the late 1970s, changes in economic policy, including decentralization of control and the creation of “special economic zones” to attract foreign investment, led to considerable industrial growth, especially in light industries that produce consumer goods. In the 1990s a program of share-holding and greater market orientation went into effect; however, state enterprises continue to dominate many key industries in China's “socialist market economy.” In addition, implementation of some reforms was stalled by fears of social dislocation and by political opposition, but by 2007 economic changes had become so great that the Communist party added legal protection for private property rights (while preserving state ownership of all land) and passed a labor

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law designed to improve the protection of workers' rights (the law was passed amid a series of police raids that freed workers engaged in forced labor). Major industrial products are textiles, chemicals, fertilizers, machinery (especially for agriculture), processed foods, iron and steel, building materials, plastics, toys, and electronics.

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