Friday, August 1, 2008

A Lengthy Analysis of China: China's Unrestricted Economic Growth and its Effects

Post 7 of an 11 part essay on how the recent unrest in Tibet is a barometer of the various internal issues and the international pressure that China is struggling to deal with.

In addition to Tibet’s lack of autonomy and ethnic discrimination, the dissatisfaction of the Tibetans is also a result of the uneven economic growth that has been one of several unaccounted-for problems in China’s overall booming economy.

Even while mired in Mao Zedong’s backward Great Leap Forward – an agricultural and manufacturing collectivization plan – it should have been apparent that China and its more than 1 billion people were ripe to have a huge economic impact soon, comparable to the fundamental role it played in global trade throughout much of its pre-modern history. Doubtless, China has come a long way from Mao’s disastrous policies, and since pragmatists like Deng Xiaoping came to power, China has slowly, but surely, started to modernize and to loosen restraints on individual economic freedom, allowing the billions of Chinese to increase their entrepreneurial output and enter the modern economic fray.

Such economic activity has propelled the Chinese economy past even those of some of the long-standing industrial powerhouses, and, even as China’s full economic potential is yet to be realized, the world is already feeling the resounding effects of China’s resurgent economy. As more and more of the over 1 billion Chinese have started to enter modern economic life, they have consumed more and more needs like oil, natural gas, and electricity, which has further driven up the price and exhausted the supplies of such resources. These consumers have also become a new market for a variety of goods and services that foreign companies have been able to profit off of. Conversely, though, Chinese companies have become increasingly competitive with foreign companies in other countries with their ability to make mass amounts of cheap goods. With such investment abroad comes greater influence over client nations, particularly in many African countries, like Nigeria, that are becoming increasingly dominated by Chinese oil companies. The wealth generated by the increasingly dynamic economy has helped to swell the government’s coffers, enabling them to exercise new measures of power, such as loaning more and more money to the U.S. government.

As the recent Tibetan unrest has shown, though, not all of China has benefited from the economic boom. The rapid growth has largely been concentrated in China’s eastern seaboard in cities like Beijing and Shanghai. Much of inland China, like Tibet and Xinjiang, remains rural and poor. Bent on overall growth, the government has given inadequate attention to the growing differences in wealth between regions.

Moreover, the minimal attention it has given has mainly benefited the Han at the expense of minorities such as the Tibetans and Uyghurs: the mostly Han business owners typically hire more Han for the high paying, management jobs than minorities, perhaps for ethnic reasons, which forces most of the minorities to take up low income, laborious jobs instead. The difficulties faced by the Tibetans and Uyghurs due to this socioeconomic gap, particularly the trouble they have affording proper services, have only added to their resentment of the Chinese and their overall dissatisfaction.[1]

Although minorities have been hit the worst, even many Han have been victimized by the growing gap between the rich and the poor: more so than in other large economies, a great number of China’s employees work for modest pay at best doing labor intensive jobs while the business executives receive the bulk of the profits from the factories they run or the low-cost products they churn out (made possible by the cheap labor force).[2]

More ominous than the negligence of the economic imbalances has been the government’s negligence of the environment, which has not only damaged China’s environment, but has also contributed significantly to global warming. Unfiltered waste pours into China’s water bodies and is not always compensated by better filtration of potential drinking water. Carbon dioxide and other more harmful substances are emitted undeterred by Chinese factories, making the air intensely polluted and, in some cities, barely breathable.[3] Indeed, many are worried about the effect such air will have on the Olympic athletes that are set to compete in less than a week,[4] and some even blame the greenhouse gases for the increasing aridness of inland China.[5] Even as many criticize the United States for its lack of concern for global warming, the reality is that China’s deplorable environmental conditions more than offset any gains that United States initiative could bring about.

Like environmental standards, safety and quality product standards have been scarcely regulated, shunted aside by the desire for pure economic growth. Such poor quality is evident in recent scandals involving lead paint and chemical toxins present in children’s toys that were made in China.[6] The appalling quality of Chinese goods hurts its export economy, as countries like the United States have become increasingly cautious about purchasing such low-quality goods, despite their low price.

Ironically enough, the economic growth for which the Chinese have neglected to regulate and balance their economy is also proving more difficult to handle than perhaps previously thought: the steep increases in economic activity coupled with the economic slowdown in the United States and rising oil prices have caused sizeable inflation[7] in China that has begun to cause some concern.

Truly, even as China’s economic surge continues to have far-reaching effects, its deficiencies hamper China’s stability and development, as well as the entire environment.

[1] See Ethnic Discrimination

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