If we evaluate China, it is necessary to explain the pace GDP growth, which from year to year, for 30 years, amount to at least 9-10% per annum. In this regard, China is the modern champion: according to today's statistics, there is no country that has achieved a weighted average real growth rate of over 10% over 20-30 years. This is an example of a successful economy in this regard. But do not forget that China is not the only country this region. There are enough countries in the Asia-Pacific region that have achieved almost the same successes, the same growth rates over the course of 20 to 30 years. The most striking example is Japan, which had an annual growth rate of 8.5% from 1950 to 1975. In Korea, too, 8.5%, in Taiwan - 9.1% since the 60th year. We should not forget, of course, Singapore, Hong Kong, Thailand, Malaysia - they all approached 9% of real GDP growth over the course of three decades. So, on the one hand, China is a good example, and on the other hand, it is just the latest example of Asian high rates of development. What explains this dynamic? The answer to this question is a simple wording - the "Chinese model" of development.
This thesis is an analysis of the causes and essence of China's economic growth. Identification of the underlying factors of growth, and the nature economic reform. In order to answer the questions posed, it is necessary, first, to define step by step what China's economic growth is, to give a brief description of the success of the Chinese economy over the past 30 years since the beginning of reforms. Secondly, to analyze the theories that exist today, giving their view on the cause of growth. To reveal the most complete and true characterization of the hypothesis and, based on it, to analyze the main reforms adopted in China since the beginning of 1978. Third, to identify and show the main factors of growth. By combining the results of the analysis, an answer will be obtained to the question of what constitutes "Chinese" economic model development.
And finally, will be considered negative sides forcing the pace of economic growth. The main ones are socio-economic problems and the problem of ecology. The latter is the most dangerous in the case of China. Violation of the ecosystem and a radical deterioration in the living conditions of the population can lead to destabilization of the political situation in China and the loss of people's confidence in the government.
October 1, 2010 marked the 61st anniversary of the founding of the People's Republic of China. In 1949, the PRC was a backward, semi-feudal and semi-colonial country. The economy was in complete ruin, the people lived in extreme poverty, and the average life expectancy of the population was only 35 years.
The half-century path of China's development has been both glorious and thorny. There were great achievements, but there were also major failures. In particular, from 1966 to 1976, excesses in politics, ideology, and culture led to a cultural revolution that inflicted the most serious moral and economic damage on the state and people in the entire period since the founding of the PRC. The country was again on the verge of economic ruin.
Tab. 1. Dynamics of GDP for the period 1966-1976 (in %)
When the “cultural revolution” ended, the Chinese people faced questions: what is socialism, where should China go next. In December 1978, Deng Xiaoping, as leader of the ruling party, answered these questions. Knowing perfectly the history and reality of China, having deeply analyzed the experience and lessons of the world socialist movement, he put forward a policy of reform and opening up, pointed out the path of building socialism with Chinese characteristics, building a socialist market economy. China, with its huge population and limited arable land, could only follow the path of socialism. Western-type capitalism not only could not solve the problem of its development, but would also lead to destruction.
Deng Xiaoping called for the emancipation of people's consciousness, the breaking of stereotypes in the concept of socialism of the Soviet model. He declared again and again that poverty is not socialism. In order to build a socialism that would have an advantage over capitalism, it is necessary, first of all, to get rid of poverty. The peculiarity of China lies in the fact that when it embarked on the path of socialism, then in terms of the level productive forces far behind developed countries. Therefore, China will for a long time be at the initial stage of socialism, where the development of productive forces is the most urgent task.
Deng Xiaoping advocated a realistic approach, noting that China does not accept Western-style capitalism. But it must be widely open to the whole world in order to borrow advanced management methods, the best achievements of science and technology, to attract foreign capital from all countries of the world, in particular the developed capitalist countries, in order to accelerate the development of the productive forces in the country. He stressed that everything that contributes to the development of socialist productive forces, to raising the overall power of the state and the living standards of the people, is good.
The implementation of Deng Xiaoping's ideas has led China to a breakthrough in economic development and social progress in the past 30 years. Today, the PRC is becoming a powerful regional superpower, rapidly taking the place of Japan as the leader of the Asia-Pacific region. For 1979-2010 average annual GDP growth was about 9.93% http://data.worldbank.org/country/china - World Bank database.
Graph 1. Dynamics of China's GDP for the period 1978-2010
Tab. 2. Dynamics of China's GDP in the period 1979-2010
The phenomenon of rapid economic growth has become a hallmark of China's "economic miracle". At the same time, it should be noted that the growing mass of commodities was largely consumed by the domestic market, and labor productivity, which remained extremely low before the start of reforms, grew at rates from 2% to 3.8% per year, providing up to 43% of the increase in national income. This favorably distinguished the Chinese economy from other Asian countries. Inozemtsev VL Limits of "catching up" development. - M.: Economics, 2000
Over the past 30 years, GDP per capita production in China has increased 20.5 times, labor productivity - 3.4 times. At present, the problem of food and clothing has been solved; great strides have been made in eradicating poverty. The standard of living of the population is rising rapidly. The deficit of goods has disappeared, at present, for the vast majority of goods in supply and demand, there is a balance and even an excess of supply. China has outstripped all countries in the world in the production of grain, cotton, oilseeds, meat, coal, steel, chemical fibers, yarn, textiles, clothing, cement, televisions and programmable switches; and for electricity and chemical fertilizers - in second place.
In the field of science and technology, China has reached or approached the world level in such fields as nuclear and space technology, high energy physics, biology, computer technology and telecommunications. total amount import and export for 2010 amounted to 2.813 trillion. dollars, and the surplus in foreign trade amounted to 199 billion dollars China in 2010 came in second place in the world in terms of exports, which amounted to 1.506 trillion. dollars, and in third place in terms of imports, amounting to 1.307 trillion. dollars http://data.worldbank.org/country/china - World Bank database.
Since the beginning of the policy of reforms and opening up, foreign capital has been used in China in a total amount of more than 806 billion dollars. In 2010, China ranked second in the world after the United States in terms of the scale of attracted foreign capital. In terms of foreign exchange savings and gold reserves, China ranks first in the world: as of 2010, they reached 2.622 trillion. dollars https://www.cia.gov/library/publications/the-world-factbook/geos/ch.html. China became the world's third largest economy back in 2007, overtaking Germany in terms of GDP. And in September 2008, China became the largest foreign investor in US government bonds.
China ranks among the most important indicators of health developing countries in the front rows. Average life expectancy has doubled since 1949 and amounted to 73 years.
The successes achieved by the Chinese economy over the past twenty years are, of course, undeniable. sustainable development of the country shows that the leaders of the state took into account many lessons arising both from the experience of their neighbors and from unsuccessful attempts to reform the Soviet economy. There are numerous forecasts, the authors of which tend to predict the future place of the Chinese economy on the world stage. According to their forecasts - in ten or even fifteen years - China will overtake the United States in terms of GNP. However, it must be borne in mind that similar predictions were made in the late 70s in relation to Japan and that the unaffected Japan of the stock market panic of 1987 was also considered an indicator of its unbreakable stability. Inozemtsev VL Limits of "catching up" development. - M.: Economics, 2000 Meanwhile, ten years later, there was no sign of the former prosperity, and the leading role of the United States in the world economy only strengthened.
Therefore, today, without belittling the importance of Chinese reforms, it must be taken into account that the reformation of Chinese society is identical to the evolution of any country that implements a policy of "catch-up development", and for this reason, one should not expect China to achieve a dominant position in the economic system of the present.
(3 Votes)The main factors behind the phenomenal growth of the Chinese economy are as follows.
The first factor is the effective role of the state in the economy, which actively influenced and continues to influence ongoing processes at all stages of economic reform. In Chinese reform theory, the term “an integrated system of macroeconomic control implemented through economic leverage” is used to designate the role of the state. Chinese leaders gradually, step by step, as the need matured, built a market (institutions, competition, private property) and in parallel supported and modernized state-owned enterprises.
Supporters of "shock therapy", which includes four main elements: price liberalization, foreign trade liberalization and exchange rate, denationalization and privatization of state-owned enterprises, holding inflation-free macroeconomic policy, believe that this is enough to quickly level the price structure to the world level and build market institutions, and then the market itself will regulate economic processes. Followers of the shock model understand that the privatization of state-owned enterprises will inevitably lead to an increase in unemployment until the private sector begins to absorb excess labor. Therefore, the shorter the transition period, the sooner, according to the supporters of "shock therapy", the economy will stabilize. For example, Jeffrey Sachs argued this as follows: "if you are going to cut off a cat's tail, then it is better to do it in one fell swoop than cut it in pieces." It is believed that, since the pain will be short-lived, political opposition to the reforms will soon die out, without having time to lead to the abolition of the reforms.
Chinese proponents of "gradualism" argue that the above four elements of "shock therapy" need not be administered simultaneously and instantly. They believe that the process should take place gradually, sector by sector, stretching over many years, and at this time (before the launch of the market autopilot) the role of the state is exceptionally large. The “gradualist” approach can be characterized by four principles. First, price reform may be incomplete and gradual (China's parallel price system). Secondly, the emergence of foreign competitors in the domestic market must be gradual so as not to lead to the collapse of the national industry. Thirdly, the privatization of state-owned enterprises is not necessary at the first stage of reforms, and private property can be developed not instead of state property, but together. Fourth, the transition to market economy can be carried out without excessively tight macroeconomic policies: " money-credit policy may not be hard or soft, but supporting the production necessary for the country. Fifth, the order (priorities) of reforms is important, synchronization does not mean the simultaneity of all reforms, but their consistent mutual influence. In China, rural reform preceded urban reform, price reform preceded property reform and property rights. At the same time, it is impossible for individual links of reforms to be too ahead of others, and some, on the contrary, to lag behind.
Depending on the stage of formation market mechanisms the functions of the Chinese state and especially the forms of their implementation changed. Direct management methods were replaced by indirect ones, directive planning - by indicative planning and forecasting, the center of gravity government intervention transferred from the microeconomic level to the level of macroeconomic regulation and, most importantly, administrative methods of regulation economic processes replaced by market ones.
The analysis shows that the public administration system that existed at all stages of Chinese reforms was adequate to the tasks of the country's economic modernization, which made it possible to turn China into a modern powerful state.
The second factor is significant resources / labor / with a constant improvement in their quality and low wages (surplus labor in the labor market has allowed and allows to keep wages at a low level). The physical growth of the population and the movement of labor from labor-surplus areas to new points of growth provided in the period 1978-1988. about a third of GDP growth.
The third factor is a high share of savings and investment (above 30% of GDP), complemented by effective strategies to attract foreign investment primarily in high-tech industries. According to many Chinese experts, investments also provided about a third of GDP growth.
The fourth factor is the openness of the economy (kaifang zhetse), based on an export-oriented development model, which involves increasing the technology and science intensity of the economy through the growth of foreign exchange earnings, mastering the latest information and communication technologies, and introducing modern industrial logistics schemes.
The fifth factor is a favorable territorial and natural location. An important factor in China's success is geographical position his territory. In the historical process of the formation of its territory, expansion in the south and northwest direction gave the country access to the Pacific Ocean, its territory included the shortest land routes from the shores of the Pacific Ocean to the countries of Europe. China has the third largest territory in the world (after Russia and Canada).
On the territory of China there are a number of large fuel (oil, coal, gas), various ore and non-metallic mineral deposits (tungsten, lead, zinc, vanadium, titanium, tin, molybdenum, nickel), as well as building materials(gypsum, barite, phosphate ores, micas, asbestos, kaolin). In terms of potential water resources, China ranks first in the world. However, on a per capita basis, China is not that rich. natural resources, especially water, forest and land (arable) resources.
Thus, the Chinese practice of economic growth is simple and does not contradict the theory: at the expense of the savings of the population and overseas Chinese (huaqiao), the state equipped the infrastructure and stimulated the creation of new jobs in the private sector parallel to the public sector, which supplied its products for export, and directed foreign exchange earnings to purchase of new technologies and modernization. Gradually, the level of consumption also increased, which increased domestic demand and stimulated the influx of new investments already in the form of global TNCs, which were eager to access the giant Chinese market.
Thanks to a long period of steadily high growth in GDP (the highest in the world) and exports (Fig. 1.5), the absolute and relative size of savings and investments, including foreign ones, the involvement in industrial production and the service sector of the millions of the population (table 1.1), China has managed to create modern industry, significantly expand and improve infrastructure (box 1.1), create a variety of industries that were previously absent in the country and thereby significantly increase the share of industry and services in GDP (table 1.1).
* Accumulation fund in national income.
** According to Chinese statistics, the primary sector is agriculture and forestry, the secondary sector is industry, energy, construction, and the tertiary sector is services, transport, education, healthcare.
Source Yearbooks of Chinese Statistics.
This article is from the section- success factors economic reforms in China which is dedicated to the topic China's Economic Growth - Phenomenal Growth Factors. Hope you appreciate it!
An interesting video about the development of China
"Learn Chinese if you are in business." Today, not a single serious international business forecast is complete without an analysis of China's development prospects. In 2011, the Chinese economy officially became the second largest in the world after the United States, leaving behind Japan. And by 2040 it will become the largest on the planet - claims Nobel laureate in Economics Robert Fogel
You predict that China's gross domestic product will grow from the current $6.5 trillion to $123 trillion by 2040. To do this, the Chinese economy needs to grow at a rate of 10 percent annually. But the Chinese government recently said it expects the economy to grow by 7% in the coming years. How might this data affect your prediction?
No way. My estimates are based on the annual growth rate of real capital - human and physical - and not on price levels. I make all measurements in 2000 dollars, so I expect the real growth rate of the Chinese economy to be at the level of 8-10%.
Growth prospects
For what?
The rate of return on capital invested per worker, that is, the efficiency of production in China, is very low today. Through the introduction of advanced and more efficient technologies, labor productivity, capital productivity and business profitability can grow tenfold. In addition, there is a process of flowing cheap labor from agriculture to industry and services - this provides about a third of China's GDP growth. If China manages to keep growth rates at the level of 5-6% in the main industries, then another 2-3% will be provided by internal migration in the labor market. This will add up to 8-9% growth per year, which will allow to increase almost 20 times country's GDP for 30 years. China is developing according to the Western model, repeating the path that all the richest countries in the world have traveled. For example, at the beginning of the 19th century in the United States, 80% of workers were employed in agriculture, and today - only 2% * * In China today, about 50% of the economic active population employed in agriculture, 20% in the service sector and approximately 10% in industry.. Another issue is that the Chinese economy, unlike the United States, is growing by borrowing existing Western technologies and applying them in local production processes. And this pattern will continue for the next 30 years.
Do you rule out apocalyptic scenarios - that the world is waiting for a war for resources and new territories, and above all from China?
I think that the Chinese authorities will not go for military adventures: they are interested in becoming rich as quickly as possible. Every Chinese leader dreams of saying, “It was during my lifetime that China went from being a very poor country very rich." This is the goal on which Chinese politicians will be focused in the coming decades.
Pay attention to what percentage of GDP they spend on military needs - 2%! Compared to the US or the EU - very modestly * * According to the Stockholm Peace Research Institute, Americans spend about 4% of GDP on military needs, Russia - 3.5%, the EU - about 2%..
Shakespeare vs Confucius
Chinese is the most widely spoken language in the world, with over 1.3 billion speakers. However, English is still the main language of business. Could it be that in the next half century, the language of Shakespeare will be supplanted from the business circulation by the language of Confucius?
I always tell my students: learn Chinese. And if someone is going to do business and build partnerships with Chinese entrepreneurs, then knowledge of the language will competitive advantage compared to those who do not speak it. But don't expect English to disappear so quickly from the world stage: it is widely spoken in China, and children in schools learn it for about 6-7 years.
You will be surprised, but to a certain extent, China today is a more capitalist country than the United States of America.
Chinese students and scholars can be found at the universities of almost every developed country. In 30 years, the flow will return, and will Americans and Europeans already be drawn to Chinese universities?
No, in 30 years this will definitely not happen, because the Chinese are borrowing technology. However, in the coming decades, we will see that in a number of branches of natural science knowledge, Chinese scientists will begin to occupy a leading position.
For now, the Americans are educating the Chinese, but not vice versa. For example, some professors from China teach in the United States for half a year, and at home for half a year. Moreover, according to my estimates, about 2 thousand professors and associate professors involved in economics. Prominent American economists advise senior Chinese government officials.
You will be surprised, but to a certain extent, China today is a more capitalist country than the United States of America. The Chinese have discovered the free market and believe that such a market is the best engine for their economic growth. They have been systematically reducing the size for 40 years. public sector in the economy: if in the late 1970s it reached about 40%, today it is about 20%.
What will happen to the yuan? Is it worth waiting for its devaluation, and if so, how can this affect the dollar, which today serves as the world's reserve currency?
This question is purely political. But even if the Chinese leadership decides to devalue, the effect will not be as formidable as experts draw: Chinese goods will not become more expensive than American ones. Keep in mind that only 15% of all goods consumed in the US are imported from abroad. Therefore, the increase in prices for Chinese goods will be at the level of the average increase in prices in the US - about 1%. It may be objected to me that everyone around is only talking about the fact that Chinese manufacturers, due to the undervalued exchange rate of their currency, have an advantage over American manufacturers, so we should erect trade barriers against them by raising duties on foreign goods. In fact, Chinese manufacturers do not have such an advantage, and American politicians and congressmen are engaged in pure populism and mislead their voters. Concerning US dollar, then in the foreseeable future, nothing threatens its status as a world reserve currency.
China, which has earned the reputation of the world's cheapest assembly site, has become a major source of disturbing news this year. The fall stock market, the devaluation of the yuan, the slowdown in economic growth - the same Chinese news that has been shaking neighboring Asian countries since the beginning of summer, and with them Europe, the United States, and, obviously, Russia. Investors from all over the world in a panic withdrew money from risky assets. Oil, metals, almost all commodities fell in price.
The Chinese economy has grown to such an extent that economic weather around the world depends on its condition. The devaluation of the Chinese yuan by 3-5% shook the world more than the Kazakh tenge, which depreciated by 30%. The fall of the Chinese national currency was supposed to spur the growth of exports, and then China's GDP.
According to the results of the third quarter, the growth rate of the Chinese economy slowed down to 6.9%, the business activity index has been falling for the third month in a row, the October figure was 49.8 points. Compared to Russia's GDP, which is expected to shrink by 3.9% by the end of the year, this growth is impressive. However, given the previous golden years, we are clearly talking about a crisis.
It took China almost 40 years to achieve such an impact on the world economy, having managed to build that same socialism with a human face. The then head of the Communist Party of China, Deng Xiaoping, explained the beginning of capitalist reforms in fact with a phrase that became an aphorism: "It doesn't matter what color the cat is, the main thing is that it catches mice." And balanced by Marx: "Practice is the main criterion of truth."
Practice quickly showed that painting the cat was the right decision. If in 1980 China's real GDP was $338.16 billion, then already in 1990 - $824.12 billion, in 2000 - $2223.69 billion, in 2010 - $6039.66 billion (in 2010 prices). China made a bet on self-sufficiency, self-financing and the rejection of centralized price regulation at the right time, and the result was already visible in the first years.
"I remember the first impressions of both the Chinese themselves and the Russians who visited the PRC in those years: after people discovered that literally on the street it became possible to buy goods that they could not dream of until recently, to convince them of the right path of the party was not required,” recalls Alexander Butukhanov, Associate Professor of the Department of Economic Theory at the Higher School of Economics in St. Petersburg.
Chinese GDP Growth
*in 2010 prices.
On the threshold of reforms, China was literally on the verge of starvation. But as soon as the peasants were left to their own devices, they were allowed to work outside the collective guidelines, it turned out that they could feed not only themselves, but also the rest of the country's inhabitants. The agricultural sector, firstly, solved the food problem, and secondly, it became a kind of training ground for working out market reforms, the economist draws attention. The problem of hunger was finally solved by the end of the 1980s.
Since the 1990s, the country has held first place in the world in the production of cereals, meat, cotton, rapeseed seeds, fruits, leaf tobacco, second in tea production, and is among the top ten world leaders in the production of wool, soybeans, sugar cane and jute. Using less than 9% of the world's arable land, China today provides food for almost one-fifth of the world's population, China's largest news agency Xinhua reported at the end of 2011.
The next most important milestone in the rise of the country from its knees was the policy of "openness to the outside world", when investments from outside began to flow into the country. Important point What distinguishes this stage, including from Russia, is that a significant part of the cash injections were provided by ethnic Chinese from other countries, mainly from Southeast Asia.
From 1979 to 2009, foreign investments amounted to $1,140 billion, of which $940 billion accounted for direct investment. About 70% foreign money listed huaqiao (Chinese from other countries), says Alexander Butukhanov. In 1991-1995 alone, investments from Hong Kong to China amounted to $18 billion a year, from Taiwan - $16 billion. Outside of mainland China and Taiwan (mainly in Malaysia, Singapore, Thailand, Indonesia and the Philippines) about 50 million Chinese live.
Overseas Chinese and the businesses they work for or own have enormous economic potential. In early 1993, Gert Hofstede estimated it at $200-300 billion - more than Australia's GDP. Since then, this number has only grown. The largest companies headed by overseas Chinese are at the same time among the most prominent foreign investors in the PRC, say the HSE.
Russia's GDP Growth
*in 2008 prices.
Another important resource with which Russia was unlucky in the early 1990s was managerial technology, which went to China in parallel with money. This moment is often not taken into account, putting the construction of factories at the forefront, while the adjustment of processes between people plays a very important role, they say at the HSE.
The question of combining capitalism with communist ideology is, of course, not an easy one. In fact, there are not many countries left in the world where the leading role of the Communist Party is officially declared - in Southeast Asia, these are China and Vietnam. So far, we do not see the prerequisites for a multi-party system. If we take the public sector, where there are many enterprises, then the role of the state is very large, in private business, of course, no. At the same time, foreign companies operating in China are calm about the presence of party cells in enterprises at enterprises. Party structures are even called upon to improve discipline or increase productivity. The main argument for - "it works". Interestingly, in the spring in China, the first bankruptcy of a state-owned company occurred - Baoding Tianwei, a manufacturer of electrical power equipment, defaulted on bonds worth $13.8 million. It is controlled by the Chinese likeness of our Rostec. That is, the Communist Party is already making it clear that it will not save just anyone, even in strategic sectors.
Alexander Butukhanov
Associate Professor, Department of Economic Theory, St. Petersburg School of Economics and Management, National Research University Higher School of Economics
Another strong point of China is free economic zones. Initially, the country's authorities clearly outlined where this is possible - port areas and coastal cities, which in a matter of years have become ultra-modern, high-tech enterprises have opened in them. Shenzhen, from the southern houses of which Hong Kong is visible, formally became a city just in 1979, and in 1980 - the first special economic zone in China. Then 30 thousand people lived in it.
Since then, the population has grown 350 times, the 2010 census estimated the population at more than 10 million. Its contribution to China's GDP is estimated at 2.5%, 16.8% of electronics exported from China comes from Shenzhen. Here, by the way, most of the Apple products are produced, in particular the iPhone and iPad. Russian officials and top managers, justifying the need to create such zones in Russia, cite Shenzhen as an example.
Today's steps in the Far East of the Russian Federation vaguely resemble the Chinese approach. It is noteworthy that the first interested are the Chinese: the north of China borders on Russia. Border cities are largely developing due to the proximity to China. One of the brightest examples is Blagoveshchensk, bordering on the Amur River with Heihe (Heilongjiang Province).
Heihe, which officially became a city in 1980, grew literally before our eyes, turning from a village into a trading city with high-rise buildings. Residents of the neighboring city love to photograph their illumination. However, beauty is concentrated mainly near the coast. Window dressing is quite an element of Chinese everyday culture.
Until the ruble fell, the Russians went to spend the weekend in Heihe. Shopping, bowling, cheap restaurants and, as a bonus, the opportunity to earn money by taking on duty-free importation of consumer goods at the border. Since 1999, visa-free entry has been operating here - the entry point to China is available to a resident of any region of the Russian Federation with a foreign passport. In summer, people go to China by ferry, in winter - trucks and tourist buses travel on ice, in the last few years - on a pontoon ferry.
Since 1995, there have been talks about building a bridge across the Amur River - the first agreement was signed by Viktor Chernomyrdin, then head of the government. Protocol events, at which "everything was finally decided and the dates set," take place almost every year, but there is no bridge yet. A month ago, another agreement was signed, they promise to start next year. Joint private investments should amount to about 16 billion rubles.
After the fall of the ruble, Chinese tourists began to come to Blagoveshchensk more often than Russians to the neighboring coast. Jewelry, canned food and sweets went there in the trucks of merchants and in the bags of ordinary Chinese - the region began to feed China for the first time, and not vice versa, local media wrote in February. A significant part of the investment in the region comes from China and Cyprus. Mostly in favor of mining. The main assets of the second largest gold producer in the Russian Federation, Petropavlovsk, are concentrated here.
The foreign trade turnover of the Amur Region in 2014 amounted to $622.8 million, of which exports amounted to $280.4 million, imports - $342.4 million, summed up the results at the local representative office of the Ministry of Foreign Affairs. It is easy to guess that the main counterparty is China, which accounts for 75.1% of exports and 95% of imports. The main export commodities are mineral products, wood and pulp and paper products, machinery, while import commodities also include machinery and equipment, foodstuffs, and agricultural raw materials.
China's own territories bordering Russia and Central Asia are another driver of China's extremely uneven economic growth, economists say. For example, the Xinjiang Uyghur Autonomous Region, which is on the border with Kazakhstan, demonstrates high rates, and Inner Mongolia is also growing, the subsoil of which contains 120 types of minerals. The effect of diverging circles from rapidly developing territories has reached the deep regions quite recently, says Alexander Butukhanov.
If we talk about China's global impact on Russia, then we are talking primarily about the supply of raw materials from our side. In 2013, for example, China imported 281.2 million tons of crude oil worth $219.63 billion (hereinafter, prices are presented mainly for 2013, since it was more stable than the crisis year of 2014). However, in the first place was still electrical equipment, the world supply of which was estimated at $356.04 billion, in the third place - the supply of communication equipment for $74.04 billion.
Over 60% of Russian exports to China are mineral fuels and crude oil. The export of the latter in 2013 amounted to 24.4 million tons, or $19.7 billion, a tenth of all deliveries. In 2014, the volumes grew by almost a third, to 33.1 million tons, but due to falling prices, the cash output increased only to $25.8 billion. thinner.
By the way, in May, the Russian Federation Saudi Arabia in terms of oil production. Cooperation with China in the oil sector is so close that Russian oilmen open settlement accounts in banks in yuan. In October, Bashneft held four tenders for opening accounts in the currencies of China and Hong Kong.
As a result, two 20-year accounts in the ruble equivalent of 1.812 billion are opened at branches of Sberbank and Gazprombank, writes RBC. The company opens two more accounts for 906.2 billion rubles with Rosbank, one of them in Hong Kong dollars. Previously, such accounts were opened by Gazprom, Gazprom Neft and Rosneft.
Companies thus, firstly, are insured against sanctions, and secondly, presumably, they are preparing for the fact that the yuan is one of the world's reserve currencies. Until October 2016, this will not happen, but the IMF has already given a positive opinion.
Russian-Chinese trade and economic ties are on the rise, says Director General of the Russian export center Peter Fradkov. And it's not just raw materials. According to the Federal Customs Service for the first half of 2015, the export of non-commodity goods to China amounted to $5.6 billion, he cites statistics.
However, there is still some imbalance - imports from China account for more than exports to it. "The Center constantly monitors the situation in order to hear the exporters in time and convey their expectations to the state: the correction of such imbalances should be regulated at the state level," the expert says. And Russia has something to offer. There is an inexhaustible potential for the export of wood products - today it accounts for about 10% of total exports to China, fish products - only about 5%, chemicals - about 3%, cellulose, fertilizers, machinery and power equipment.
Sources: Rosstat, Central Bank.
Russian industrial production also largely depends on China. Machinery and technical products are a key export item to the Russian Federation. From 2002 to 2014 specific gravity of these goods increased from 15.8 to 36.1%. The share of goods such as textile and knitwear, as well as shoes, fell from about 13% to 6% over the same period, but it must be understood that total exports to the Russian Federation over the years increased from 3.5% to 53.7%.
But China's most significant global export is manufactured goods, which account for 95% of all exports. China is still the largest assembly site. Of course, Malaysia, Thailand, the Philippines and Vietnam are already beginning to claim the role of the PRC in this regard, where the labor force is cheaper. But putting them next to China, where the population exceeds 1 billion people, and the infrastructure works like clockwork, is too early.
Sooner or later, China will be removed from the position of the world's main factory, on the other hand, China itself begins to invest outside. One recent example is the oil fields in Iran, which will have sanctions lifted by the end of the year. China is actively investing in Africa: from 2003 to 2013, investment in African infrastructure increased from $500 million to $20 billion.
In the same 2013, oil imports from Africa provided almost a quarter of China's needs. The positions of the continent are close to those of Russia: oil accounted for 64% of Chinese imports from Africa. Explored reserves here are constantly growing.
Chinese partners are very fond of gifts, we try not to go to negotiations empty-handed. But one day a real opportunity came up. We prepared good gifts for representatives of one large company, but they, embarrassed, refused. It turned out that shortly before this, the management forbade them to accept any gifts from partners, except for a branded souvenir. But there are gifts that you can never go wrong with - the Chinese especially appreciate souvenirs with a national flavor. For the Chinese in general, traditions and culture are very important. For example, to negotiate in Chinese. We have employees who are fluent in it. The notorious small talk is valued higher in the East than in Europe, and a quick transition to business is perceived as excessive assertiveness. It is easy to show elementary courtesy: you can ask how the flight went, how the colleagues you have already met are doing, how the partner’s success in a hobby. There are textbook rules: send and receive a business card with only two hands, be sure to offer tea. For the Chinese, tea drinking is a sacred ritual, a kind of wish for good health and well-being to a business partner.
Anna Kuzmina
Deputy commercial director "Yandex.Money"
It is difficult for small businesses to interact with China, we do not deny it, but now it is one of the most promising markets, which is definitely worth working with. We have been cooperating with Chinese partners for more than 5 years. Now more than 40% of all our suppliers are Chinese companies. And this is no coincidence. The so-called B-brands from China are increasingly occupying their niche in the market, the client increasingly does not want to overpay for a well-known name, because the price difference is huge, and the quality of gadgets is almost the same. In addition, it is simply profitable for online retailers to trade with China. When we began to buy filters and tripods in China, our margin for these groups increased by 40%. The Chinese are a calm philosophical nation, with which it is extremely difficult to demand anything. If the goods are cheap and bulky, it is better to include the defect in the cost price and simply dispose of it. It will be cheaper than shipping. The main problem with Chinese suppliers is enough high percent marriage, so you need to carefully choose a partner.
Alexey Bannikov
CEO GK "Photosklad.ru"
You must always keep what is happening under the most severe control and monitor every little thing, down to the font of the text on the box. If at some point the control over the project is weakened, with a probability of 95% it will have to be redone. The Chinese may genuinely not understand what the problem is. Everything is right for them. Every little thing needs to be discussed during the negotiations. Even better - show how to do it. Sometimes we pointed out a mistake, the Chinese corrected it, but then they made another one. If there is no representative on site, you will have to constantly call the production, otherwise the project may stall altogether. The highest happiness is to find an intelligent support manager. For some time we successfully worked with one factory, then the deadlines began to be delayed, there was no result. It turned out that the support manager was replaced at the factory, and this is almost the key person in the joint project. Therefore, you need to carefully choose not so much the factory as the accompanying person from the Chinese side.
Alexey Aksenov
CEO of iRZ (wireless products for M2M industry)
Our company in China often provides services for finding suppliers for large companies from the CIS. To us precisely because negotiations are a very delicate area. The price list for the Chinese is not a dogma, but a reason to start a conversation. Learning how to talk to them is difficult. Clarity, perseverance and consistency are definitely not the trump cards. Emotions too. Negotiations should take place in a calm, somewhat slow manner. The Chinese do not like long contracts, and you will most likely have to draw them up. Therefore, you need to verbally clarify all the points. And do not be embarrassed that there will be many clarifying questions, the Chinese are ready to patiently answer them. Never try to convict partners of anything. The Chinese immediately fence themselves off from such attempts with a blank wall. The likelihood that they misunderstood something or simply read the contract inattentively is quite high, but this is a working situation for which you must always be prepared. Even worrying about a misunderstanding can be taken as a reproach.
Timofey Kim
Director of TenderPro Group for China and Central Asia
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