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Expats in ChinaChina: An Overview

Although China is the most populous nation in the world, with a population estimated at 1.39 billion in 2014, it is surprisingly only the fourth largest country, being slightly smaller than Canada and the USA. China is densely populated overall, though the western half is mostly devoid of people and the population is concentrated in the eastern heartland. Due to the ‘one child policy’, however, the population is only growing by 0.5% a year. India is set to overtake China in terms of population in the near future, and on current projections, the population of China will eventually start to decline.

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China has a history of advanced civilization that stretches back millennia, and for many centuries the Chinese led the world with their unparalleled technological and cultural achievements. However, by the 18th century, innovation in China had greatly declined as stagnation and inefficiency took their toll. After the Industrial Revolution, Western European nations made great leaps in science and technology and soon overtook China. From the 19th century, Western countries started to exploit China’s weakness, establishing treaty ports and gaining trade concessions. The country endured several humiliations and rebellions before the Empire fell and a republic was declared in 1912.

However, the recovery was short-lived; China was at war for nearly two decades from 1931. First, the Japanese occupied Manchuria and made it into a puppet state called Manchukuo. Around the same time, a civil war was brewing between the Nationalist rulers and the Communists. After the Japanese were defeated, the Chinese Communist Party (CCP) eventually prevailed, proclaiming the People's Republic of China (PRC) on 1st October 1949. The defeated Nationalists fled to Taiwan (officially called the Republic of China), which has held on to a tenuous de facto independence ever since.

The Chinese people suffered greatly during these wars, especially at the hands of the Japanese, but the worst horrors were still to come. Mao Zedong, the new leader of the PRC, was a man wih gigantic, impossible ambitions. He wanted to turn China into a modern industrial nation in his lifetime, by whatever means and at any cost. He therefore set up a Stalinist, totalitarian state of unrelentingly brutality. During Mao’s reign, while he and other senior CCP members lived in luxury, more than 70 million Chinese died and hundreds of millions were terrorised, beaten or starved into submission.

The dark days receded slowly after Mao's death in 1976. Deng Xiaoping, who took over as supreme leader in 1978, started to reverse Mao's barbaric policies and supervised a gradual thaw, equivalent to perestroika in the USSR. However, China's thaw has been slower, as it has yet to convert its highly restrictive political system into something resembling a democracy. On the other hand, leaving their political constraints to one side, individuals have a reasonable degree of economic freedom. China's acceptance of market mechanisms has underpinned its startling economic and technological advances in the last twenty years. The current president of China is Xi Jinping.

In a couple of decades or so, China may become the world's largest economic power, at least in terms of financial influence. In 2011 China's GDP was US$11.3 trillion at purchasing power parity, ranking fourth in the world, and about two-thirds of the US figure (if nominal GDP figures are used, China is much further behind). China's GDP has been growing at up to 10% for the past few years, while figures for stagnating Western nations are in the 1-3% range.

China is currently projected to overtake the US, at least in PPP terms, within ten years. Of course, in GDP per capita terms, the picture is much less rosy for China, with a 2011 level of US$8,400, between a fifth and a tenth of that in the US. On the other hand, the low pay rates and other costs that this figure implies are a are a laerge bonus for China, which has an enormous competitive advantage over most developed countries. Then again, some of the business practices that created this massive growth – such as the profligate creation of ‘ghost cities’ – may well cause pain for China in the future.

China's competitive advantage over the West is accentuated by what Western politicians and economists say is a secular undervaluation of China's currency, the yuan or Renminbi. This accounts for the difference between 'nominal' and 'PPP' GDP figures. China disagrees, but is very gradually allowing the Renminbi to trade up. The currency remains non-convertible in most respects, although a number of capital market instruments, particularly in Hong Kong, are chipping away at this. It is expected that the Renminbi will become convertible within five years, and the difference between nominal and PPP valuations will probably unwind over the same period.


Country Name: China
Coordinates: 32.9043° N, 110.4677° E
Capital: Beijing
Capital Coordinates: 39°55'N 116°23'E
Other Main Cities: Shanghai, Chongqing, Hong Kong
Population: 1353821000
Area: 9706961
Official Language(s): Standard Chinese
Ethnic Group(s): Han Chinese 91.5%, Other 8.5%
Demonym: Chinese
Currency: Renimbi, ¥
GDP: $12.405 trillion
Time Zone: China Standard Time (UTC+8)
International Dialling Code: 86
Internet TLD: .cn
Electricity Voltage: 220 Volts AC (50Hz)



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