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China: Coming to Grips with the New Global Player

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  • Horst Siebert

Abstract

This paper analyses China's economic performance in the last 25 years and discusses its prospect for growth in the future. Exports and investment have been the two driving forces for the high annual GDP growth rates. FDI plays an important role. However, structural issues such as the loss‐making state‐owned firms and the fragile banking industry have to be solved. Monetary policy is complicated by the accumulation of reserves which, however, provide an insurance for the fragile banking system. Property rights, a crucial element in transforming a communist society, are far from being clearly developed. Major policy issues in the future include the correction of the distorted growth process and of the institutional deficits, especially with respect to the rule of law and the lack of democracy.

Suggested Citation

  • Horst Siebert, 2007. "China: Coming to Grips with the New Global Player," The World Economy, Wiley Blackwell, vol. 30(6), pages 893-922, June.
    • Handle: RePEc:bla:worlde:v:30:y:2007:i:6:p:893-922
    DOI: 10.1111/j.1467-9701.2007.01037.x
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    Cited by:

    1. Maria Herrerias, 2010. "The causal relationship between equipment investment and infrastructures on economic growth in China," Frontiers of Economics in China, Springer;Higher Education Press, vol. 5(4), pages 509-526, December.
    2. Kishor Sharma & Wei Wang, 2014. "Foreign Investment and Vertical Specialisation: An Analysis of Emerging Trends in Chinese Exports," Proceedings of Economics and Finance Conferences 0401580, International Institute of Social and Economic Sciences.
    3. International Monetary Fund, 2014. "The Federal Democratic Republic of Ethiopia: Selected Issues Paper," IMF Staff Country Reports 2014/304, International Monetary Fund.
    4. W. Max Corden, 2009. "China's Exchange Rate Policy, Its Current Account Surplus and the Global Imbalances," Economic Journal, Royal Economic Society, vol. 119(541), pages 430-441, November.
    5. Fukao, Kyoji & 深尾, 京司 & Yuan, Tangjun, 2012. "China'S Economic Growth, Structural Change And The Lewisian Turning Point," Hitotsubashi Journal of Economics, Hitotsubashi University, vol. 53(2), pages 147-176, December.
    6. Horst Siebert, 2007. "China – opportunities of and constraints on the new global player," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 8(04), pages 52-61, January.
    7. Siebert, Horst, 2008. "An international rule system to avoid financial instability," Kiel Working Papers 1461, Kiel Institute for the World Economy (IfW Kiel).
    8. Horst Siebert, 2007. "China – opportunities of and constraints on the new global player," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 8(4), pages 52-61, January.
    9. Horst Siebert, 2008. "China-Opportunities of and Constraints on the New Global Player," Working Papers 2008/13, Turkish Economic Association.
    10. Zoltan J. Ács & Wim Naudé, 2011. "Entrepreneurship, Stages of Development, and Industrialization," WIDER Working Paper Series wp-2011-080, World Institute for Development Economic Research (UNU-WIDER).
    11. Pearson, Joseph & Viviers, Wilma & Cuyvers, Ludo & Naudé, Wim, 2010. "Identifying export opportunities for South Africa in the southern engines: A DSM approach," International Business Review, Elsevier, vol. 19(4), pages 345-359, August.
    12. de Haan, A., 2009. "Will China change international development as we know it?," ISS Working Papers - General Series 18718, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
    13. Herrerias, M.J. & Orts, Vicente, 2011. "Imports and growth in China," Economic Modelling, Elsevier, vol. 28(6), pages 2811-2819.
    14. Acs, Zoltan J. & Wim Naud�, 2011. "Entrepreneurship, Stages of Development, and Industrialization," WIDER Working Paper Series 080, World Institute for Development Economic Research (UNU-WIDER).
    15. Shujie Yao & Dan Luo, 2009. "The Economic Psychology of Stock Market Bubbles in China," The World Economy, Wiley Blackwell, vol. 32(5), pages 667-691, May.
    16. Naihua Jiang & Wang Liping & Kishor Sharma, 2013. "Trends, Patters and Determinants of Foreign Direct Investment in China," Global Business Review, International Management Institute, vol. 14(2), pages 201-210, June.
    17. Chengsi Zhang, 2009. "Excess Liquidity, Inflation and the Yuan Appreciation: What Can China Learn from Recent History?," The World Economy, Wiley Blackwell, vol. 32(7), pages 998-1018, July.
    18. Maria Jesus Herrerias & Vicente Orts, 2011. "The driving forces behind China’s growth," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 19(1), pages 79-124, January.
    19. Bofinger, Peter & Schnabel, Isabel & Feld, Lars P. & Schmidt, Christoph M. & Wieland, Volker, 2014. "Mehr Vertrauen in Marktprozesse. Jahresgutachten 2014/15 [More confidence in market processes. Annual Report 2014/15]," Annual Economic Reports / Jahresgutachten, German Council of Economic Experts / Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung, volume 127, number 201415.

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