China: Competing in the Global Economy

Books, February 24, 2003

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China's economic reforms over the past two decades have brought tremendous economic transformation, rapid growth, and closer integration into the global economy.
Real income per capita has increased fivefold, raising millions of Chinese out of poverty.
Despite these achievements, difficult reforms— involving the state-owned enterprises and the financial sector—must still be completed.
Social pressures from rising unemployment and income inequalities need to be addressed.
China's accession to the World Trade Organization will bring benefits but will also impose obligations on the economy, and could prove to be a watershed for the reform process.
This book examines the country's reform process, its past successes, and future challenges.

Rapid income gains: real income per capita increased fivefold.
Poverty reduction: millions of Chinese were raised out of poverty as a result of reforms.
Remaining reform priorities:
- State-owned enterprises: continued difficult reforms required.
- Financial sector: further reforms needed, including addressing nonperforming loans and financial institutions.
Social challenges:
- Rising unemployment.
- Income inequalities and pressures on personal income distribution.
External integration:
- Accession to the World Trade Organization is identified as a pivotal development with both benefits and obligations.

Subjects: Balance of payments, Bank credit, Central banks, Financial crises, Financial institutions, Foreign direct investment, Money, National accounts, Nonperforming loans, Personal income, Production, Production growth, Total factor productivity
Keywords: accession to the World Trade Organization, Africa, Asia and Pacific, Bank credit, debt stock, Europe, extent FDI, FDI inflow, Foreign direct investment, Global, income distribution, Nonperforming loans, Personal income, Production growth, reform process, South Asia, Total factor productivity, WTO accession