How has China been affected by globalization Essay Example for Free

How has china been affected by globalization EssayIn the belated 1970s china do perhaps its most significant st respectgic political manoeuvre of the 20th Century when it embarked on a series of frugal reforms that embraced globalization (Bijian, 2005). Deng Xiaoping and some other Chinese leaders believed that to further chinas development, participation in an open global rescue would be crucial to its survival (Chow, 2002) During the three decades since these reforms Chinas political and scotch institutions get underg ane a dramatic transition (Overholt, 2005 and Economy, 1998). China has shifted from the worlds greatest opponent of globalization into a committed constituent of a global economy and advocate of globalization (Overholt, 2005). The pinnacle of this transformation and Chinas economic harvest-feast was its entree into to the World trade in Organisation (WTO) on 11 December, 2001 (Allen et al, 2006 and Fishman, 2005). Consequently, China is now subject ed to multinational trends and forces to a stop unprecedented since 1949 (Bijian, 2005 and Chow, 2004). In this essay I will analyse the burden that globalization has had on Chinas political, economic, court-ordered and technological institutions. Furthermore, I will also analyse whether China has been strained to change to pander to the international economic community or whether it has voluntarily instituted change for its own benefit and development.However before analysing the effect that globalization has had on China it is important to understand what the term globalization means. orbiculateisation became a buzz word in the 1990s because of its influence in creating a world in which geographic location became increasingly irrelevant (Immerfall 2006). In essence globalisation refers to the un confine flow of goods, capital, information, technology and people across national borders (Chow, 2005a).Globalisation is, however, by no means a new phenomenon and China has been subjected to its effects for more centuries (Alford, 1999). In fact, the effects of globalisation in China go as far back as the Han dynasty (206BC-220AD) when trade took place between the Han Chinese and neighbouring people in the North-west through the Silk Route (Chow, 2004 3). condescension this, in the Qing Dynasty and the early stages of the Chinese Communist Partys rule, right up until Deng Xiaopings open door policy, China time-testedto c drop away its doors and restrict the influence of globalisation (Street, 2000 and Chow 2004 and 2005a).This was not the first time that China was forced to confront and implement a national strategy to either embrace or combat the effects of globalisation. In fact, as recently as the 1990s, China was confronted by this conundrum, namely whether to continue its global economic expansion in the face of the Asian financial crisis or to once again close it doors and draw off inwards to protect itself from the economic fallout of a struggl ing region (Fishman, 2005 and Nolan, 2001). However, by c befully unhurriedness the advantages and disadvantages of economic openness the Chinese government decided to open up the Chinese economy all the same more, and eventually joined the World hatful Organization by implementing large economic reforms (Bijian, 2005).There is no doubting that these economic reforms and Chinas embracement of globalisation has brought stunning consequences. Since starting to open up and reform its economy in 1978, China has averaged 9.4 percent annual GDP growth, one of the highest growth rates in the world (Bijian, 2005 3). whiz of the reasons for the huge leaps in growth has come from straightaway contrary investment that has been facilitated by Chinas admission to the WTO.For example, in the space of a few days in 2004, a North Korean Steel partnership launched a $500 one thousand thousand steel project in the Dalian development zone Frances St Gobain invested $70 million in one of its e xisting glass production lines in China Ger umteens Siemens opened its 40th office in China for development of software and Finlands Stora Enso invested $1.6 billion in a paper human body project in Guandong Province (Hall et al, 2004). Such results have seen China become the third largest trading earth in the world and the envy of galore(postnominal) developing economies around the world (Chow, 2005b).While such economic statistics are regularly celebrated by the Chinese government as a success of Chinas cellular inclusion into the WTO, many in China are in fact lamenting the negative effects of globalisation and the scrutiny that WTO membership has brought. In fact WTO membership came at a very high outlay for the domestic Chinese economy (Overholt, 2005). Throughout the 80sand 90s China initiated structural changes such as the phasing out of direct subsidies for exports and began cutting tariffs in preparation for inclusion into the WTO (Pearson, 2001). Over the three years from 1994 to 1997, the res publicas average tariff rate was lowered from about 43 to 17 per cent and at the time of Chinas founding into the WTO in late 2001, the overall average was just 15 per cent. Such drastic economic changes were at the behest of the WTO and the result beingness that a lot of factories and domestic industries have gone bankrupt because many people prefer foreign products which have become cheaper as a result of Chinas inclusion into WTO (Solinger, 2005).Furthermore, Moore (2002) also argues that Chinas accession into the World Trade Organization could be viewed as more beneficial to the rest of the world rather than China itself. WTO commitments made by China do not in any way protect Chinas domestic producers and wherefore the argument that that the greatest benefit of Chinas WTO membership is enjoyed by foreign companies is indeed a valid one (Moore, 2002 311). Yang (2004 307) argues that admission into the WTO was in fact too big of a restructure step for China and continues by noting that Chinese involvement in the WTO is great for foreign companies and bad for local ones because one of the first practice of laws enacted to learn WTO membership was designed to attract and protect investment from overseas.It is clear that this lack of protectionism, although beneficial to the outside world, has been break the income to domestic businesses. Of particular note is the fact that with Chinas WTO membership foreign investors have been allowed access to markets that were previously restricted or exceedingly regulated (Samuelson, 2004 and Pearson, 2001). These incursions have been most evident in the insurance, telecommunications, and financial industries (Prasad, 2004). Such arguing is however of great benefit to the domestic Chinese consumer. In fact, fifteen years ago China barely had any mobile telecommunication services, whereas now it claims more than 300 million mobile earpiece subscribers, more than any other nation (Bijian , 2005). Whether this is a result of modernisation or globalisation is highly debatable, but it is clear that Chinese consumers are embracing the increase in products and services renderd by many foreign companies.Other than the local businesses being hurt by foreign investments and industries, the turn over market in China is also suffering from major unemployment as a result of the forces of globalisation (Chow, 2004). While entry into the WTO has in itself not created joblessness, it has however heightened a number of trends that were already underway, including accelerating the rate of insolvency of state owned enterprises. The result being the discharge of tens of millions of workers who, when they were younger, were once assured of employment by the socialist state (Economy, 1998 and Chow 2004 and 2005b). correspond to Prasad (2004 6) the unemployment problem is in fact likely to worsen over the next few years ascribable to restructuring in the rural and state enterprise s ectors, the very type of restructuring that has been mandated upon China by the World Trade Organisation.Another cause of the unemployment problem currently facing the Chinese economy is its shift away from sunset industries such as manufacturing, mining and construction to newer industries that demand workers with specialised skills (Prasad, 2004 Solinger 2005 and Yang 2004). Similar changes are evident in Chinas effort to upgrade its technology industry, which has not only involved the replacement of much unskilled labour but in many baptismal fonts also reduces the need to employ as many skilled wage-earning workers (Nolan, 2001 and Economy, 1998). While this can not be directly liked to WTO membership it is clear that the forces of globalisation are having a major impact on the Chinese economy, the products it produces and its labour force.The amazing growth in Chinas economy as a result of its increased participation and integration in a global economy is also having social a nd political consequences. Most notable a maturement divide between Chinas full and poor. Obviously China would not have self imposed such drastic economic changes stringently to encourage direct foreign investment to the detriment of domestic businesses, but it is clear the benefits of the global marketplace are not being shared around Chinas 1.3 billion people (Solinger, 2005 and Chow, 2004). It is very much the case in China that the rich are gettingricher and the poor are just getting left-hand(a) behind.This is also evident in the growing regional inequalities in China. Despite the governments attempts to rectify the situation, foreign investment has continued to flow to those provinces where education levels are the highest, infrastructure most well developed and political military group most concentrated (Overholt, 2005 and Economy, 1998). Moreover, while the wealthier provinces in theory pay taxes to the centre to compensate the poorer provinces, in come this system h as failed allowing corruption to flourish, resulting in power becoming de-centralised from Beijing to local authorities. Not surprisingly such inequality has contributed to serious political tension between the haves and have nots (Bijian 2005 and Economy 1998).Overholt (2005 7) however argues that despite the growing divide between the rich and poor, the Chinese overwhelmingly support further globalisation. Overholt (2005 7) asserts that no large country in human history has ever experienced such rapid improvements in living standards and work conditions as China has in its packance of adjustments to accommodate the forces of globalisation. So while the economic dividends of Chinas rapid growth are not being shared equally around the country, the majority are nonetheless stop off.One of the reasons for such widespread approval of the modernisation of the economy has been the upgrading of technology, especially telecommunications which has been an essential aspect of the Chinese governments plans for continued economic growth (Chow, 2004 and 2005a and Econommy, 1998). Normally if there is general contentment among the population then this would provide little in the way of difficulties for those in power. Fred Tipson (1998 12) however, notes a difficult conundrum for the Chinese government in their embracement of economic globalisation. The Chinese leadership has repeatedly emphasized the central role of telecommunications and information technologies in make its modern economy..on the one hand, actively promoting a modern communications infrastructure, while on the other hand, repeatedly trying to control the content and uses of the information that pulses through it.Tipson (1998) concludes that thecommunications variety will hang the need or inclination of most Chinese to defer to central authority or accept routinely the governments characterization of reality.The Chinese government is more than aware of the threat to its power that the technological revolution and global scrutiny presents. Given the current uprisings and discontent in Tibet the government has blocked access to many websites to control the flow of information to not only its own people, but the international community (Maunder, 2008). So while the forces of globalisation may have brought prosperity to China, the Chinese government also has to work extra time to maintain its grip on power.When evaluating the impact that globalisation has had on China it is important not to lose sight of the big designate. Economic growth alone does not provide a full picture of a countrys development and despite Chinas population of 1.3 billion, its Chinas economy is still just one-seventh the size of the coupled States (Bijian, 2005). However, the open-door policy that was first advanced by Deng Xiaoping in the late 1970s has been of great success in modernising China. It is true that such rapid growth has presented China with some problems, including the demise of some domest ic industries, unemployment and low political instability, however given its current path it appears that Chinas rise to superpower status is inevitable.BIBLIOGRAPHYAlford, William (1999) Does the rule of law really rule? paper presented before the Conference on Policy Reform in China, revolve around for Research in Economic Development and Policy Research, Standford University, November 18-20, 1999 (Online) on tap(predicate) from http//www.cdy.sagepub.com/cgi/reprint/11/3/287.pdf Accessed tenth surround 2008Allen, Franklin. Jun Qian and Meijun Qian (2006), Chinas Financial Reform Past, Present and Future in Loren Brandt and Thomas Rawski, ed. Chinas Economic Transition Origins, Mechanism, and Consequences. University of Pennsylvania, Wharton teach MimeoBijian, Zheng (2005) Chinas Peaceful Rise to Great-Power Status Foreign Affairs September/October 2005Chow, Gregory (2002) Chinas Economic Transformation Oxford Blackwell Publishing CompanyChow, Gregory (2004) cognise China Sin gapore World Scientific Publishing CompanyChow, Gregory (2005a)Corruption and Economic Reform in the earliest twenty-first Century Princeton University, California MimeoChow, Greogry and Yan, Shen (2005b) Demand for Education in China Princeton University, California MimeoEconomy, Elizabeth (1998) China Confronts the challenge of Globalization New York Rockefeller Brothers Fund, IncFishman, Ted (2005) How the rise of the next super power challenges America and the world New York, N.Y. ScribnerHall, D., Jones, R., and Raffo, C. (2004) bank line Studies 3rd Edition, Lancashire Causeway Press LtdImerfall, Stefan (2006) Territoriality in the Globalizing Society One Place or None? (Online) Available from http//www.amazon.com/Territoriality-Globalizing-Society-European-Transatlantic/dp/3540643222 Accessed 9th March 2008Maunder, Patricia (2008) The Great Firewall of China The Age, March 20, 2008 (Online) Available from http//www.theage.com.au/news/web/the-great-firewall-of-china/2008/03 /18/1205602389513.html? Accessed 21st March 2008Moore, Thomas (2002) China in the World Market New York, NY Cambridge University PressNolan, Peter (2001) China and the Global Economy National Champions, Industrial Policy and the Big Business Revolution New York, N.Y PalgraveOverholt, W (2005) China and Globalization Testimony before the U.S.-China Economic and Security Review Commission, May 19, 2005. Santa Monica, California Rand CorporationPearson, Margaret (2001) The Case of Chinas improver to the GATT/WTO, in David M. Lampton (ed.), The Making of Chinese Foreign and Security Policy in the Era of Reform, 1978-2000 Stanford Stanford University PressPrasad, Eswar (2004) Chinas Growth and integration into the World Economy Prospects and Challenges International Monetary Fund Publications, June 17, 2004.Samuelson, Paul (2004) Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists musical accompaniment Globalization Economic Perspectives, 18 3 Summer, 2004Soling er, Dorothy (2005) Chinese Urban Jobs and the WTO The China Journal, May 2005Street, N., Lynch, M and Marilyn, J (2000) American Business in China Balancing Culture and Communication (Online) Available from http//www.cald.org/website/polparties_asia.htm Accessed 5th March 2008Tipson, Fred (1998) China and the Information Revolution China Joins the World progress and Prospects New York Council for Foreign Relations PressYang, Dali (2003) make the Chinese Leviathan Stanford,