Describe China’s consumption of goods and services. What shortcomings have accompanied China’s economic growth?
The economy of the People’s Republic of China is the second largest in the world after the US when measured on a purchasing power basis. With a booming economy and 1. 3billion people, it is now the world’s largest consumer of grain, meat, coal and steel.
China is no longer just a developing country. It is an emerging economic superpower and is one that is writing economic history. China has witnessed a rapid growth in consumption in recent years. Their purchasing power enables them to buy more, meaning more of basic necessities that the previous generation was not privileged to have.
Yet this also means that the rapid rise in demand creates a multitude of problems as the country continues to hungrily gobble up the resources in and out of the country that could be allocated for other countries/markets. China is likened to a hungry giant whose insatiable demand for commodities heralds a new era of permanently higher prices–a commodities super cycle. Its soaring demand for commodities has exerted a powerful pull on global commodity markets.
It has a major impact on major segments such as the following: energy, the hard commodities such as metals, and the soft commodities such as agricultural products. But on the other hand, the demands of China’s stunning economic growth in recent years have had a complex and uneven effect on global prices for energy and other commodities. Although different industries all over the world also benefit from the huge market and profit, there are numerous problems that arise because of the huge consumption of the country.
China’s massive appetite for goods ranging from grain to platinum places it at the centre of the world raw materials economy. Other countries find themselves “competing” with China for a share in commodities. And even China finds itself in a ditch. Because China’s insatiable demands are putting ever more pressure on the country’s natural resources. The huge consumption and growth mean more wastage. Its population’s impact on the environment can only grow stronger and yet even today, it is already very evident in their own surroundings.
The impact of the cumulative waste of over a billion people is astounding. A huge majority of Chinese is still dependent on coal for their energy production. Coal is the number one cause for climate change. A big number of their waters are almost turned into open sewers due to the wastage from many factories and cities. Ill-planned projects may have also destroyed natural habitats and have displaced animals and plants. Respiratory and heart diseases related to air pollution are the leading cause of death in China.
And this is only the beginning of a few problems that have begun to arise as China slowly climbs to the top. China’s role in global commodity markets will only grow more important in the next 20 years. The solution to the continuing arising problems from their inevitable growth would be, to develop schemes that regulate their pollution and wastage and to create international relations and foreign policies that will positively affect poorer (or richer) economies.
The Chinese government should implement the schemes rigidly as the negative effects will eventually catch up on each individual as it affects their health. The government should strengthen and improve the work of existing and emerging organizations (whether it may be local, national or international) through intensive training, demonstration of new approaches, international exchange, and strategic communication.