Should the world worry about China’s economic expansion?
China is among the leading world economies being second to the United States of America. China has favorable economic environments that are favorable for business flourishing. Cheap labor, adequate human expertise, availability of raw materials, and low cost of production in China has enabled rapid economic growth. The Silicon Valley in China is home to most of the world-class businesses including the renowned US Company Apple. Organizations across the globe are relocating to China to cut on production cost to increase their productivity. The flourishing economic growth in China is of concern to other world economies. The Chinese thirteen trillion dollar economy is a matter of interest to the world. The economy has grown steadily over a short period which is attributed to the conducive atmosphere to conduct business in China. The Chinese production market is free entry with little government regulations. The tax tariffs in China offer incentives for businesses to achieve their expected profit margins.
Chinese exports have dominated the world market. The low cost of production in China has increased its surplus production. The surplus products find their way to the world market at reasonably low prices. It causes market competition crisis to products from other countries. It has caused businesses to close or migrating to China to try and sort the competition crisis. When enterprises migrate to China, it translates to a loss of employment to the affected country. It becomes a plus for the Chinese citizens who get more jobs from companies relocating to their country.
The Chinese involvement in global financing of developing countries is of concern to the developed countries and the world as a whole. The Chinese government is funding many projects in African and other developing countries in Asia. Through the funding, the Chinese get a chance to penetrate the markets in these countries giving them a prime opportunity to dispose of their products. They can cut deals with the involved government and will exploit the possible benefits from these bilateral engagements. The Chinese government is offering development loans to African countries allowing them to utilize the fortunes available in the African continents. China has worn most of the tenders for construction and infrastructure development in Africa which is stimulating their economic growth from the returns. The Chinese will use their machinery and tools in the project development hindering the purchase of these inputs from other countries.
The expanding Chinese Military as a result of the improved economy is of concern to the world superpowers and the entire globe. The Chinese military prowess coupled with recent technology is of concern to other nations. The Chinese are manufacturing weapons of mass destruction which destabilizes the world peace because nobody knows their next move on this business.
In Conclusion, the Chinese economy accounts for a third of the world growth every year. Economic growth acts as a vital driver of improved living standards and job creation. Despite the large population in China, the Chinese government can offer affordable health care and education to its citizens. The Chinese dominance of the global trade, increased donor funding to developing countries, and the broad military base is of concern to the world economy players. China is growing to the next world superpower a thing that is not palatable to the western countries.