Another tie-in to our piece on China's Stresses, Goals, Military Buildups... and Futures. Dave Schuler has been a long-time commenter here at Winds.
China's economic growth has been phenomenal. Since 1979 China's GDP has grown by 8-10% each and every year. According to the World Bank, China's purchasing power parity gross national income per capita in 1978 was $340. By 2000 China's PPP GNI per capita was $3,920 and it continues to rise. China has entered the international middle class.
China's remarkable growth has not come without cost. China is an enormous country with a population of one-sixth of humanity, its problems are commensurately huge, and some of these problems are so pressing that they won't wait for a solution. In a series of posts on these, China's Time Bombs, I've attempted to give the reader a hint of the scope and significance of some of these problems:
- The first post in the series discussed environmental degradation in China which threatens the health of the Chinese people - and the health of the people in countries to which China exports food. Yes, China is a food exporter. They are one of the world's largest exporters of chicken breast meat, for example.
- The second post in the series addressed the graying of China. As others have put it, China will become old before China becomes rich.
- The third post in the series expands on the explanation by noting the problems with China's pension system (or lack of a pension system). There's a parallel here to the discussion of our Social Security system in the USA, but the implications for China are vastly more serious.
- The fourth post in the series scratches the surface of the problems in China's banking industry. It's hard to overstate the importance of this time bomb since a sound credit system will be critical if China is to sustain its growth.
In the next post in the series I plan to suggest that China's current economic strategy is not sustainable. And in the final post in the series I'll try to wrap it all together and suggest what China's failure or success in dealing with these problems may mean to the rest of the world.
I would not trust Chinese statistics. For various reasons, they tend to be inflated. Also, it's easier to grow at a high rate when your economy is small. Growing 50% from $1 to $1.50 is easier than growing 10% from $10 to $11.
While it's true that China is a food exporter, it's also a food importer... and the expansion of manufacturing means China may face another constraint: a water crisis that would drop its own food producton. Here are some thoughts from the Earth Policy Institute on this subject, with figures.
China is now the world's largest importer of soybeans, may be ending its policy of grain self-sufficiency, and has declared that cities and industries will get priority in the competition for water as aquifers fall and demand rises. As the water table issues and industrial water demand begin to bite, other foodstuffs may well follow soybeans as major Chinese imports, in exchange for its goods. Eco-Economy points out that 1 ton of grain represents 1,000 tons of water flow to produce, so foodstuff importation is the cheapest way for water-deficit economies to effectively import water.
If that's all true, China could find itself relying on sea lanes and transport lifelines for a lot more than just oil...
Interesting comment on WaPo, by Samuelson in editorial "Global Savings Glut":
"To say a country has surplus saving is simply another way of saying that it lacks good investment opportunities at home or discourages its citizens from consuming. Asian countries favor export-led growth, deemphasizing local consumption."
Don't forget the 20 million young men and adolescents born since 1980 for whom there will be no Chinese wife.
#4 - And also remember that China is still the world's number one exporter of female babies to the almost-completely-American adoption market.
Foreign Adoptions
The actual 'base issue' here though is far more insidious: that (according to my very good native Chinese friend, just back from a trip to his home in Hunan and across the whole of China) that the situation for the young 'new adults' is universally degrading in its competition.
In a nutshell...
Anyone with an IQ over 100 has parents who will sell their belongings to get them to higher education. Once accomplished, and often through being taken in a large metropolis, society says, "well, get a job, and oh that's in Beijing, Shanghai, Wuhan, Chengdu, Chonquing, Xian or Tiajin (or another 5 dozen megacities)". The young never come home. They pit themselves for any kind job at all in the cities. The incredible pollution, squalor, bare existence, servitude are beyond description. Lung disease is the top problem, followed by a zoo of cancers and 'toxic chemicals' issues that would make you blanche.
So of those "20 million" excess boys? As a whole, the population inverts toward more women-than-men by the average age of 30 years.
China needs - really needs - to get a grip and realize that polluting themselves into oblivion (and polluting the world it turns out) is a really, really bad idea.
GoatGuy
China has entered the international middle class.
Which goes to show that repressive political oligarchy can pay off if you give it a few hundred years, provided you have lots of people to squeeze and the right trading partners abroad.