Nowadays, China is one of the most important countries in the world. It is the world?s second most powerful economy and it is growing day by day. As we know China has have an enormous increase since the last 30 years, that?s thank for the Mao’s mandate; he start to promote an independent nation which can grow even without the foreign investment, but after his death everything changes to an open nation, increasing the international trade and accepting the foreign investment.
On the other hand, we have Mexico which is a country with a stable economy, but similar to China in some things.
For example we also were close-doors to the international trade. We started to interchange goods to the whole world still 1994, when Mexico entered to the GATT (General Agreement on Tariffs and Trade). In this time we began to increase our economy more than other past years. My intention in this work in make a comparison between the actual Chinese and Mexican economies, and integrate some possible challenges and opportunities that this both countries can have now days and in the future.
The opportunities and challenges of the Chinese and Mexican economies in the future.
To start talking about the future of the economies of these both countries first we have to see the present of that. We have to have a clear panorama about how are going those countries and which are their changes in the actuality. Firstly I am going to start talking about China. As we now, in the last 30 years, the rate of Chinese economic growth has been shocking, averaging 8 percent growth in Gross Domestic Product (GDP) per annum. But now the situation has been changed.
For example, CNN said that China’s economy grew 7. 4% in the third quarter compared to the last year, marking a deceleration from a 7. % growth rate in the prior quarter. That not means that China is stopping its growth but now is lower than before. This decreased can be for many factors, the quick acceleration on the inflation and the accumulation of the economy bobbles may be some reasons. Other Chinese problem is the GDP per capita is very low in China. Now China is in the 122 place in comparison to the world. The per capita income of China is only about 2,000 US dollars, which is fairly poor against global standards. That means most of its population is poor so it still be a big challenge for this nation.
About exportation and importation china has the better rankings of the world. In exportations china occupied the first place of the world, as the most important sector is the industry, this country made a lot of goods to ship around the world. On the other hand, the importations are located on the 3rd position, those are not the largest of the world but that means that China has a stabilized good trade balance. In china the unemployment is low because this country has been worried about all its population. As we know China has the biggest population of the world so this is not an easy work.
China is making more and more new jobs to maintain all their people. A lot of companies are coming to China to obtain better manufacturing prices than other places. Secondly let?s start talking about Mexico. The panorama in this country is totally different to China. The growth has been stable since a lot of years ago. I did not mean that Mexico is not growing but the growth is much less that China or other countries. We are maintaining almost the same parameter on the previous years. The GDP in Mexico is quite positive because even with the decrease on the crisis in 2008 we are increasing again our economy.
According to INEGI, (Mexican institution), Mexico suffered a deceleration in commercial and services sector. This issue caused a decrease in the rate of the economy. But the expansion still continues. Mexico did not have as big GDP as China or other potential countries but now we are in the 12th position in the whole world. So that means that our nation is trying to grow year by year even we have a lot of difficulties on a variety of sectors, as security, education, or investment in our own country. About imports and exports Mexico is located in the 20th position in both.
So I think this is not good for my country because it is able to export more around the world. Lastly we are focus just to export to USA 80% of the exportations are to USA so I think we can open more our boards and begin to ship goods to others countries or continents. To talking about unemployment rate in Mexico, we have a low rate as China. We have a lot or policies to the workers and to provide jobs to the entire nation, but the problem here is there are not well-paid jobs, so the economy can grow enough how we wish.
So after that I am going to start talking about the opportunities and challenges to both countries. First I think China has a big opportunity investing in the agriculture sector, the statistics says that the agriculture only has the 10% of the participation in the GDP, so this country can invest more to can maintain and feed its own country without the necessity to import a lot of agriculture goods, with that investment a lot of poor people can work in the land and get more money to themselves.
In this way the economy is going to grow up and there are going to be less property. Other opportunity that china has now is take advance to the European crisis. China is a country with large reserves so it can support to borrow money to this continent or invest money in some company from there, because now European countries doesn’t have enough money and they are going to take almost any offer in a low price. One challenge for China is the Chinese consumer price inflation has gone from 6. 5 percent in 2011, down to 2. 2 percent in June 2012.
Inflation is an intermediate to long-term problem for China which means the country needs to stabilize its prices to maintain the economy growing as the previous years. In Mexico I think one of the opportunities that we can have is investing in the small and medium companies. Most of the companies in Mexico are small and medium so if the government invest more and try to help them giving more facilities and capacitation to get more skills for the competition in the entire world, we can advance and have more local investment and stop to be depended of the foreign direct investment.
One of the biggest challenges for Mexico is the security. In the last years the insecurity situation in Mexico is getting worse than before and this is causing that some foreign companies are leaving our country to go to investment in other place. This is a worrying situation because the foreign investment is very important for the Mexican economy so we need to keep them in our country. Conclusion For the conclusion I think the Mexican and Chinese economies are so different ecause the Chinese has had the biggest growth in a lot of years, it has been increasing in its entire sector and becoming to one of the most powerful nations of the world. Otherwise Mexico has had a slower growth but it has been maintained the economy in a good position against the world. Both of them have a lot of opportunities and challenges to increase their economies but I think with a good leader both can development very fast. They have in common the change of administration government and we hope that results in the best way and can resolve the major of the biggest problems for each country.
Cite this Chinese Economy: World’s Second Most Powerful Economy
Chinese Economy: World’s Second Most Powerful Economy. (2017, Jan 09). Retrieved from https://graduateway.com/chinese-economy/