Apr 1, 2021 in Analysis

China Country Analysis


China is the country that has demonstrated a tremendous growth in the recent years. The overview of the countrys economic indicators also provide for further rapid growth. The analysis of the key performance indicators, the context of the state, its international and investing policies will definitely help to determine the key industries and businesses that are worth investing.


Performance Analysis

The financial performance of china is rather impressive regardless of the recent economic decline demonstrated by the country. Some of the economic metrics indeed reflect it. At the same time, the gross domestic product has grown from 65.718.17 to 69.659.39 in 2015. The exports of good and service has also increased significantly from 1,455.21 in 2013 to 2.400.702 in 2015. The national gross income has increased by almost 10%. At the same time, the country experiences the metrics related to the goods and credit also changed dramatically. The GDP per capita has also increased considerably though it still does not reach the US indicators. China's currency exchange rates have dropped in the latest couple of years when compared to US dollar. The average bank loan rate also decreased recently. Chinese inflation and 7-day repo rates are quite unstable due to the shifts in economy. The labor demand index has dropped as well with the respective increase of the unemployment rates in 2015. The annual wages increase by 10% annually. The poverty bridge estimated by percents tends to change by 5% annually.


The strategy of China is rather self-evident. First of all, the country aims to replace the USA in terms of economic dominance. It is willing to accumulate the comprehensive national powers. The vision that the country nurtures provides for the Chinese world's dominance and leadership. The goals of the state provide for the sustaining high economic growth, maintaining international order, pacifying the periphery and enhancing of its international status. The established 5 year plan of Chinese development definitely corresponds to the goals and vision of the state as it concerns all the key areas.

The foreign policies and the regulations regarding the investments are tied to he domestic politics of the country. Currently, the state has the adopted limited leadership system and the marginalized traditional institutions of governance which rely heavily on the policymaking. In the future, Chinese policies will still be affected by the background o the political leaders and various biases which negatively affects the flow of investments to the country. Yet, the economic matrixes outweighs these negative issues. Still, the international policy of the state will provide for the increasing partnership and cooperation especially with the regional partners. It will continue to compete with the USA, though the Cold War is definitely out of sight.

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In terms of international affairs, it should be stressed that the country enjoys the favorable position on international arena. It is an influential international partner of many states and is one of the key members of the influential world organizations. It holds the ambitions for the regional dominance and most probably it will achieve this goal by 2020. Moreover, there are numerous tensions between India and China regarding the territories; therefore, the possibility of the future territorial conflicts is not excluded and it might significantly affect the commercial issues as well.

The analysis of the domestic affairs is far more complex. First, the country is subjected to the strong influence and ideology of the Communist party which manages to combine the elements of market and administrative economies. The country is rather rich in terms of the labor potential and resources though its primary strategy nowadays is to copy the ideas that are developed overseas. Additionally, the country is oriented on the reforms that concern almost every part of life including the education, manufacture, labor, land regulations etc. The institutions are rather strong; however, they use the power not to empower the citizens but rather to control them and the input they give to the economy. The state has demonstrated great progress in the past five years and has become the world's second economy.

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Assessing the country's performance as well as the context factors and the strategy, it should be stressed that China is still considered to be the state with the growing economy and markets regarding of the recent decline in numbers. In 2016 it still managed to grow its GDP by almost 10% which is quite an enormous indicator of the financial health of the country. Considering the political and social climate of the country such numbers demonstrate that the business and politics are somehow connected and that the latter is definitely in favor for creation of the strong and well-functioning economy. The country is paradoxical in many dimensions and it is expected that the change of the political leaders will not result in the disruptions for the businesses. Considering the international ambitions of the country, it is still deemed to be the appropriate country for placing one's investments.

The industry that definitely shows promise in China and is worth investing in is agriculture. Currently, the state is rather underdeveloped in this regard and the modernization is still on. Yet, it has all the valuable resources and potential for becoming a region that feeds the country. The availability of the cheap equipment manufactured just by the nearby plants is definitely beneficial. Moreover, the country's government plans for the year of 2017 include the key reforms related to the agriculture. They particularly include the increased protection of the rights of the landowners and the renovation of the shantytowns and the speeding up of the overall development of the cities and communities. The state also commits to provide support to the farmers willing to establish the agriculture initiatives in China. The policies will be adhered to protect the cultivated land in order to boost the productivity and ensure the grain security. The government also promises the reform of the rural land system that will facilitate the development of the industry. Considering the working style of Chinese people and their derivativeness, this industry is definitely the best option for investing in.

The company that is worth investing in is Baidu Inc. It is presumed that in the future the use target audience of this search engine will increase. Currently it replaces the Google which tried to enter the market and failed. Considering the policies of the Chinese government and its history of limiting the freedoms and rights of the citizens, it is presumed that the same policies will be also applied to the virtual reality. Thus, the popularity of the search engine will only grow in the future considering the pace at which the technologies develop and penetrate to one's life. Thus, the company's stocks show great potential in terms of ROI.


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