Blog
Unit 2 Macro: Focus on China - Changing Economic Structure
26th January 2012
China has experienced fast growth in the last twenty years, in the last decade; the increase in Chinese GDP has been seven times the rise in the GDP of Japan. China has a new growth target of 8% pa for the next five years – a downgrading of growth but still way in excess of normal trend growth for any of the advanced economies such as the UK, Germany and the United States. In 2000, China’s accounted for 7.1% of the world’s total GDP (in PPP terms). By 2015 China will have a 19% share of global GDP. This is higher than any of the other BRIC nations
Our chart above shows the changing structure of the Chinese economy. The share of GDP (by valued-added) from industry has remains close to 50% for more than 30 years, but since 1980 the share contributed by service industries has been growing from 30% to 43%. This is still well below the norm in advanced developed countries where services often account for more than 70% of GDP.
Industry
Data from Timetric.
To view this graph, please install Adobe Flash Player.
Industry, value added (% of GDP), China from Timetric
Agriculture
Agriculture’s share of Chinese GDP has fallen from 30% of GDP in 1980 to less than 10% in 2009. There has also been a mass movement of millions of people away from rural areas into urban centres of population. The new 12th Chinese Five Year Economic Plan is centred on developing the services sector, increasing urbanization and improving incomes – there are big opportunities here for UK service multinationals
Data from Timetric.
To view this graph, please install Adobe Flash Player.
Agriculture, value added (% of GDP), China from Timetric
Services
Data from Timetric.
To view this graph, please install Adobe Flash Player.
Services, etc., value added (% of GDP), China from Timetric
% of employment in agriculture
Data from Timetric.
To view this graph, please install Adobe Flash Player.
% of employment in industry
Data from Timetric.
To view this graph, please install Adobe Flash Player.
Employment in industry (% of total employment), China from Timetric
Geoff Riley
Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.