1330044000
Standard Chinese or Mandarin (official; Putonghua, based on the Beijing dialect), Yue (Cantonese), Wu (Shanghainese), Minbei (Fuzhou), Minnan (Hokkien-Taiwanese), Xiang, Gan, Hakka dialects, minority languages (see Ethnic groups entry)
Shanghai 23.741 million; BEIJING (capital) 20.384 million; Chongqing 13.332 million; Guangdong 12.458 million; Tianjin 11.21 million; Shenzhen 10.749 million (2015)
- Conventional long form
- People's Republic of China
- Conventional short form
- China
- Local long form
- Zhonghua Renmin Gongheguo
- Local short form
- Zhongguo
communist state
- Name
- Beijing
- Geographic coordinates
- 39 55 N, 116 23 E
- Time difference
- UTC+8 (13 hours ahead of Washington, DC, during Standard Time)
has not submitted an ICJ jurisdiction declaration; non-party state to the ICCt
Since the late 1970s, China has moved from a closed, centrally planned system to a more market-oriented one that plays a major global role. China has implemented reforms in a gradualist fashion, resulting in efficiency gains that have contributed to a more than tenfold increase in GDP since 1978. Reforms began with the phaseout of collectivized agriculture, and expanded to include the gradual liberalization of prices, fiscal decentralization, increased autonomy for state enterprises, growth of the private sector, development of stock markets and a modern banking system, and opening to foreign trade and investment. China continues to pursue an industrial policy, state-support of key sectors, and a restrictive investment regime. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, China in 2016 stood as the largest economy in the world, surpassing the US in 2014 for the first time in modern history. China became the world's largest exporter in 2010, and the largest trading nation in 2013. Still, China's per capita income is below the world average.
- Inflation
- 2.008%
- External debt stocks
- US$ 1,418,291,086,000
- Total tax rate (% of commercial profits)
- 68.0%
- Real Interest Rate
- 3.101%
- Manufacturing, value added (% of GDP)
- 29.738%
- Current Account Balance
- US$ 196,380,229,053
- Labor Force, Total
- 802,968,952
- Employment in Agriculture
- 28.30%
- Employment in Industry
- 29.30%
- Employment in Services
- 42.40%
- Unemployment Rate
- 4.61%
- Imports of goods and services
- US$ 1,950,366,571,269
- Exports of goods and services
- US$ 2,199,967,569,433
- Total Merchandise Trade
- 32.91%
- FDI, net inflows
- US$ 170,556,525,654
- Commercial Service Exports
- US$ 207,192,115,755
world leader in gross value of agricultural output; rice, wheat, potatoes, corn, tobacco, peanuts, tea, apples, cotton, pork, mutton, eggs; fish, shrimp
world leader in gross value of industrial output; mining and ore processing, iron, steel, aluminum, and other metals, coal; machine building; armaments; textiles and apparel; petroleum; cement; chemicals; fertilizer; consumer products (including footwear, toys, and electronics); food processing; transportation equipment, including automobiles, railcars and locomotives, ships, aircraft; telecommunications equipment, commercial space launch vehicles, satellites
- Commodities
- electrical and other machinery, including data processing equipment, apparel, furniture, textiles, integrated circuits
- Partners
- US 18%, Hong Kong 14.6%, Japan 6%, South Korea 4.5% (2015)
- Commodities
- electrical and other machinery, oil and mineral fuels; nuclear reactor, boiler, and machinery components; optical and medical equipment, metal ores, motor vehicles; soybeans
- Partners
- South Korea 10.9%, US 9%, Japan 8.9%, Germany 5.5%, Australia 4.1% (2015)
- Country Risk Rating
- B
- Political and economic uncertainties and an occasionally difficult business environment can affect corporate payment behavior. Corporate default probability is appreciable.
- Business Climate Rating
- B
- The business environment is mediocre. The availability and the reliability of corporate financial information vary widely. Debt collection can sometimes be difficult. The institutional framework has a few troublesome weaknesses. Intercompany transactions run appreciable risks in the unstable, largely inefficient environments rated B.
- Reduced risk of external over indebtedness thanks to the high level of foreign exchange reserves and to the maintenance of a current account surplus
- Sovereign risk contained: public debt mainly domestic and denominated in local currency
- Gradual move upmarket
- Development of services
- Development of infrastructure
- High volatility in the strong market
- Social tensions linked to rising inequality
- The share of consumption in GDP remains weak: re-balancing of the Chinese growth model remains a challenge in the medium-term
- Aging of the population and gradual drying up of the abundant and cheap labor pool
- Overcapacity in certain industrial sectors and high corporate indebtedness
- Fragile Chinese banks (rapid increase in credit and deterioration in asset quality)
- Government's strategy is ambiguous on arbitrating between reform and growth
- Environmental problems
There was a slight downturn in business in China in 2016 and this trend is expected to continue in 2017. Reforms aimed at re-balancing growth to benefit consumption and services should continue but the authorities must remain vigilant in supporting the activity in order to avoid a brutal adjustment of the economy. The monetary policy should remain accommodating. Fiscal stimulus measures would also support investment in infrastructure. Nevertheless, the profits of fragile companies will remain under pressure and private investment will remain limited in 2017. Indeed, given that companies are heavily indebted and many sectors are at overcapacity, the monetary and fiscal stimulus has proved ineffective. In this context, disposable income is expected to grow at a slower rate and the growth of household consumption will be somewhat curbed. Despite the very rapid expansion in online sales, retail sales are losing momentum since 2015.
In 2016, construction-related sectors benefited from the rebound in property prices, particularly in major cities. By 2017, prudential measures put in place by many cities to limit price increases could restrict investment and hamper the sector. However, a collapse in the housing market is however not very likely, as the authorities have the capacity to act in the event of a severe shock. The growth of the services sector, in particular financial, is also continuing.
Finally, exports are expected to continue to suffer from sluggish global demand. Nevertheless, the downward pressure on the yuan could increase the country's price competitiveness.
Although the level of public debt is sustainable, that of local municipalities is high (at around a third of GDP) and remains opaque.
In addition, there are companies with very high debt levels and which, due to the expansion of shadow banking, are very difficult to assess. By March 2016, private sector debt would have accounted for nearly 210% of GDP. On top of this and despite the easing of monetary policy, the problems being faced by SMEs in accessing finance have pushed them in many cases to make use of shadow banking, and its exorbitant rates,
In this context there has been a gradual decline in the quality of banking assets which are also underestimated because of the scale of shadow banking. The ratio of non-performing loans reached 1.8% in the third quarter 2016, its highest level since 2009. Increased by "special loans", this ratio reached 5.9%. Credit risk has increased significantly, highlighted by the growing number of defaults on the Chinese bond market. While the country experienced its first default in 2014, 24 companies (including one third of state-owned companies) defaulted in the bond market in the first quarter of 2016. The introduction of a real risk of insolvency is inevitable and will help reduce the moral hazard created by government interventions. The solvency of companies in precarious situations, in the context of the economic downturn, will need to be monitored in 2016.
The foreign exchange market has seen high levels of volatility since mid-2015. The downward pressure on the yuan against the dollar is expected to continue in 2017 due to capital outflows. Foreign exchange reserves are expected to continue to decline. Nevertheless, they will remain very high (over 18 months of imports) and the authorities should continue to implement measures to control capital outflows, such as increased supervision of cross-border mergers and acquisitions.
Although continuity was the watchword for the transition from the previous government, President Xi Jinping has an unprecedented level of power within the Chinese Communist Party (CCP), enabling in particular his anti-corruption campaign which includes the very highest office holders in the party. The 19th Congress of the CCP, to be held at the end of 2017, should renew the President's term for another five years. The Xi Jinping – Li Keqiang duo is however facing both social and ethnic challenges. The country is marked by growing labor unrest.
Whilst reaffirming the supremacy of the CCP, the Central Committee session of the CPC in October 2014 ended with decisions relating to improvements to the rule of law. In addition, the 5th plenary session of the Communist Party, which was held in October 2015, ended the one child policy and reaffirmed the desire on the part of the authorities to develop the social protection system. Finally, there are continuing serious failings in terms of governance in particular in terms of accessing the balance sheets of companies and above all the legal protection of creditors.