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The developing East Asian giant: China dr. Jeney László Senior lecturer [email protected] Economic Geography I. International Business bachelor study programme (BA) Autumn term 2015/2016. CUB Department of Economic Geography and Futures Studies 1949–1976: Attempted Geographic Shifts Initial attempts of the Communist Government (Mao Zedong): Great Leap Forward + Cultural Revolution – – – – Expand output rapidly Distribute economic activities Equality within China Enhance national defence 1949: NE + Shanghai + Tianjin: 70% of output – Move the production of military goods inland – Factory locations close to the raw material sources (coal, hydroelectricity, oil) Poor transportation linkages Central and W China developed slowly – Manufacturing production remained in NE 2 1978: economic output of China < S Korea or Taiwan Changing directions after 1976 Deng Xiaoping: 1977 overall economic reforms – – – – – After 2000: further revolution based on telecommunication systems (use of internet and mobile phones) – – – „4 modernizations”: agriculture, industry, science, defence new approach to rural life Encouraged investment from foreign corporations Increasing manufactured exports Economy multiplied six fold within 20 years 1990–2000: telephone lines 10 125 mn 1995–2010: mobile phone users 5 800 mn (WR1) Sensitivity of state control of website content China does not follow the Asian sample – – Asian NIC countries: 1. raw materials and food export, 2. simple manufactured than 3. more sophisticated goods, 4. service industries China: all typed of goods from rice to microchips 3 Farming and rural living in the 2000s Agriculture: prominent in the rural economy Through Mao Zedong years: farming – – Low levels of mechanization high labour inputs 1980: agriculture still employed the entire – growing – rural workforce Early 1980s: relaxed commune controls individuals and groups plan their own programs – Low govermental priority Separated from other aspects of the economy Personal involvement higher output 2000: half of the rural workers in farming Rural industrial expansion Township and village enterprises (TVEs) – – – – Driving forces – – New rural sourcs of income Took underused rural labour Higher wages 130mn employees (30% of rural workforce) Initially: collectively owned enterprises (by late 1980s: from 22 to 36 % of Chinese industrial output) Later: individual and private enterprises Millions of people remained in industrializing rural areas – BUT: many milions more moved out of the rural areas to the cities Manufacturing 22% of labour force, half of GDP Standing on two legs: ancient-moderns, small-large Huge development during the last four decades Regional locations: – Before the revolution Textile and food industry, ports Steelmaking (Japanese): Northeast – First three decades of socialist industrialization Inner parts of the country, regional equalization – From 1979: opening policy High-tech industries, ports again, increases regional differences 4 important industries Traditional – Textile and clothing industry (16%): sea coast (Shanghai), inner parts – Food industry (10%): areas producing raw materials, sea ports Rapid developing – Machinery (30%): capital, ports, special economic zones – Chemistry (10%): coal mining areas, oil refineries (Daqing) Other industries – Iron and steel industry: Anshan, Shanghai – Ceramics (porcelain of Jingdezhen) – Paper industry Opening to the world economy and its difficulties Till 1979: one of the closest economy of the world – Lagged from Taiwan (21 mn) and Hong Kong (6 mn) Later intensified foreign economic relations – Official opening policy – Coming back of Hong Kong Main partners: Japan, USA Hong Kong: linking unit between China and the world market Difficulties of the opening – – – – – Large country: ability for self-sufficiency Traditionally limited relations Self-sufficiency at regional and local level as well Linking to foreign trade only in coastal areas Underdeveloped transportation and telecommunication systems Transportation Without developed infrastructure the program of „4 modernization” is very difficult Inner waterways: traditional important Rapid development 1990s: motorways – Canton – Hong Kong, Shenyang – Dalian, surroundings of Beijing Railways: cannot follow the needs of economy – 3 railway lines to Russia (1 via Mongolia), N Korea, Vietnam, Kazakhstan-Europe (1992) – Railway building to Inner Asia (Tibet) Regional differences Two separated parts – E, SE: core of the ancient Chinese civilization Better climate High population concentration, political centre 1/3 of the territory, 85% of population, 90 % of production – W and Inner Asia Deserts, high mountains Political dependency Increasing han population Underdevelopment Regional policy: 3 regions affect towards the increase of differences – East: developed sectors, high technology – Middle: raw materials, modernization of factories, development of infrastructure – West: minority education, recovery of natural resources HDI: Human Development Index „Concentrated decentralization” Increase of territorial inequalities 1980: special economic zones (Shenzhen, Zhuhai, Shantou, Xiamen) – 1988: Hainan 1984: 14 ports opened – 1990 along Yangtze (Chang Yiang) River, 1992 border cities 1992: 13 customs free zones 1997 Hong Kong, 1999 Macau: special administrated areas „One country with two systems” – Basis of unification with Taiwan