Question

What are some goals for China's GDP compared to a different country? Explain.

Answer 1

Case Specifics: -

China has emerged as one of the key countries in Asia, which has attained an extremely high growth rate in the recent years, primarily because of the shift from a centralized economy in which the government takes over control over all major resources to a market based economy in which the forces of demand and supply decide the prices of goods and services.

What differentiates the Gross Domestic Product for two countries is the rate at which it grows and the core elements of this growth and strategy thereafter. China was previously an extremely poor country, in which vast majority of people were living under extreme poverty. This however changed, as it shifted its focus towards becoming a manufacturing giant which it is today.

The core difference in the GDP of China and for example the United States is the fact, that China is able to produce goods much faster at a much lesser cost of production. The reason for that being the fact, that China has vast majority population which is ready to work for a small percentage of what the labour force would take in any other economy.

This manufacturing with low cost ability has made it one of the hotspots of world manufacturing. To save costs, numerous companies across the United States and other manufacturers from across the globe have shifted their base from their local economy to China to avail the low-cost model.

Thus, we can say that the Chinese economy has the central goal of being able to manufacture goods and services for the entire world economy which is much different than what most other economies are doing at present. Other countries in Asia, for example India, Srilanka, Philippines etc are all unable to match this degree of competitiveness and cost reduction techniques that China has implemented.

The Chinese Government thus views growth under 6-10% to be not at par. It is one of the fastest growing economies in the world and is soon to become a developed economy at the rate at which it is currently growing. While countries such as United States are barely growing 2%, the Chinese economy grew as much as 6% and it has also exhibited growth rate of over 10% in the previous years.

Conclusion: -

We can conclude by saying that mass production and low-cost manufacturing is the core of the Chinese GDP and growth rate. It is these two critical factors which make the country different from any of its competition. The growth rate in China has been much higher than any other economy primarily because of this element which most other countries lack. It is a mass exporter of goods and services at a cost which no one else is able to match.

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