china in the global economy: the last ten years and the next

China in the Global Economy:The last ten years and the next

Ted H. ChuChief Economist

General Motors CompanyMay 12, 2010

GIC Annual Monetary & Trade Conference

Ted Chu, China Next Decade 5‐12‐2010 1

2

Government & PolicyIntensified anti

corruption activities

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

“Population & Family Planning Law”

Hu Jintao elected President

Agreement with Russia over border

conflicts

Violent protests in Lhasa, Tibet

China celebrates 60 years of communism

Google to end censorship in China

http://images.google.com/imgres?imgurl=http://www.watblog.com/wp-content/uploads/2010/01/google-china.jpg&imgrefurl=http://www.watblog.com/tag/google-china-censorship/&usg=__67D2R-JFMiF2sk5qB6v6dpu5-i0=&h=340&w=451&sz=96&hl=en&start=10&sig2=neXTqP10KFGLs0kDN0km9w&um=1&itbs=1&tbnid=n4WM9zd1NLYRsM:&tbnh=96&tbnw=127&prev=/images?q=google+china+censorship&um=1&hl=en&sa=N&tbs=isch:1&ei=Ij3XS_rPDZzCM5qTwMMF

http://report.globalintegrity.org/images/07indicators_china.gif

http://www.google.com/imgres?imgurl=http://media.eyeblast.org/resources/51763.jpg&imgrefurl=http://ifrl-blog.blogspot.com/2009_07_01_archive.html&usg=__lfPh7mIl673u9jQijT738pOBKRM=&h=357&w=499&sz=43&hl=en&start=31&sig2=odtgcKZyYo-ZrkeQNKjWxA&itbs=1&tbnid=RXMefTRLLwFBRM:&tbnh=93&tbnw=130&prev=/images?q=china+family+planning+law&start=18&hl=en&sa=N&gbv=2&ndsp=18&tbs=isch:1&ei=YC3XS-ilEYryM_LJ_FM

http://www.google.com/imgres?imgurl=http://is.chineseembassy.org/eng/xwdt/W020060101209907667507.jpg&imgrefurl=http://is.chineseembassy.org/eng/xwdt/t229005.htm&usg=__xWXaYX_SwSQYVUUCOvBvAgz_cFk=&h=500&w=469&sz=48&hl=en&start=7&sig2=VNSamAfgRXr2Jjz1ssBX3w&itbs=1&tbnid=5asaMDhW9pUwWM:&tbnh=130&tbnw=122&prev=/images?q=hu+jintao&hl=en&gbv=2&tbs=isch:1&ei=vS3XS6rYM46CNvTf3bcF

http://www.google.com/imgres?imgurl=http://blog.cleveland.com/world_impact/2008/07/medium_BorderChina_Russia_Meye.JPG&imgrefurl=http://www.cleveland.com/world/index.ssf/2008/07/20-week/&usg=__rnOP8C9KUN6Wplu38Ln9U5QGVOw=&h=283&w=240&sz=73&hl=en&start=11&sig2=YUuFHsX7FGAL2opa8FCivQ&itbs=1&tbnid=3xBruuQDTN4ddM:&tbnh=114&tbnw=97&prev=/images?q=china+russia+border&hl=en&gbv=2&tbs=isch:1&ei=gi7XS6G6CoqMNZqhka8F

http://freetibet2008.org/wp-content/uploads/2008/08/tibetanflagsprotest-small.jpg

http://images.google.com/imgres?imgurl=http://a.abcnews.com/images/International/ap_china_anniversary_01_090929_ssh.jpg&imgrefurl=http://abcnews.go.com/International/popup?id=8702223&usg=__Yscft6OGE-5XOnvFJbXyntCB5Z0=&h=411&w=531&sz=127&hl=en&start=4&sig2=nXYYbbh6_X6mRV5xpdUJCA&um=1&itbs=1&tbnid=1BURgwx4nLdUWM:&tbnh=102&tbnw=132&prev=/images?q=china+celebrates+60+years+of+communism&um=1&hl=en&sa=N&tbs=isch:1&ei=vzzXS_qwEofkMa-i8LQF

3

Economy

China becomes a member of the WTO

New gas pipeline opened between

Turkmenistan & China

China becomes largest automobile market in the world

Millions of migrant workers lose their jobs due to global

financial crisis

Government announces a $586

billion stimulus

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Launched Grain Subsidy Policy

Terminated Agriculture

Tax

Launched West Development

Policies

http://www.google.com/imgres?imgurl=http://www.china-ces.org/files/2007216171712.gif&imgrefurl=http://www.china-ces.org/ces_conference/showcontent.asp?id=19&usg=__7G_OhItGQoqfmgeRT1neUhPKtUI=&h=482&w=481&sz=132&hl=en&start=2&sig2=xcWgsZox254ReBJ7pcm0iA&itbs=1&tbnid=A4CpOxfs87tP7M:&tbnh=129&tbnw=129&prev=/images?q=china+west+development&hl=en&gbv=2&tbs=isch:1&ei=O4jYS8SQMJKotAOgiKC5BQ

http://www.chinadaily.com.cn/pics/chinagate/wto.gif

http://www.sanoatloyiha.com/uploads/news/en/200905/photo_big_4.jpg

http://www.google.com/imgres?imgurl=http://www.carbizweekly.com/wp-content/uploads/2010/01/China-cars-image.jpg&imgrefurl=http://www.carbizweekly.com/&usg=__fZInehMwPwd_eCJwnjP7wzRNKVc=&h=366&w=499&sz=75&hl=en&start=74&sig2=O7-wFqw33zVU8UYNQXXxCQ&itbs=1&tbnid=X2RY-D1oTGB3lM:&tbnh=95&tbnw=130&prev=/images?q=china+largest+auto+market&start=72&hl=en&sa=N&gbv=2&ndsp=18&tbs=isch:1&ei=Y-DVS7SqGoKdlgeZ4qC6CQ

http://www.israelasiacenter.org/communities/8/004/006/758/838/images/4526249007.jpg

http://www.google.com/imgres?imgurl=http://cache1.asset-cache.net/xc/51875668.jpg?v=1&c=IWSAsset&k=2&d=77BFBA49EF878921F7C3FC3F69D929FD3D6E8E24F8AD364C06FD31FEE8BB692DAF7015CB1840736BDA70E170507C691C&imgrefurl=http://www.life.com/image/51875668&usg=__EoXzH97GaEK4PT-QowDgRMenTtI=&h=394&w=594&sz=44&hl=en&start=11&sig2=QyPX_owbp_DjaKKrpXanlQ&itbs=1&tbnid=2rBGBqcxYDJapM:&tbnh=90&tbnw=135&prev=/images?q=rural+tax&hl=en&gbv=2&tbs=isch:1&ei=iILYS8PfHpeQsAP6-eidBg

4

Culture, Education & Science

Shanghai ExpoThe Hanyu Pinyin

alphabet

Chinese scientists publish Indica genome sequence

Beijing is awarded the

2008 Olympics

Beijing 2008 Olympics

The Chinese inaugural edition of “Rolling Stone”

Three Gorges Dam project begins

Four million people have to be resettled within the next 1015

years in the Three Gorges Dam area

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

http://www.google.com/imgres?imgurl=http://www.shanghaiist.com/attachments/shang_dan/rollingstonechinamarch2006.jpg&imgrefurl=http://shanghaiist.com/2007/01/26/cui_jian.php&usg=__xCzgVGXxHRg1Hg_atI1D85wACmU=&h=325&w=272&sz=50&hl=en&start=4&sig2=qKbtq5TFfQeVYlbWUW-2kg&itbs=1&tbnid=U0k_drVPAv7ajM:&tbnh=118&tbnw=99&prev=/images?q=first+chinese+rolling+stone&hl=en&gbv=2&tbs=isch:1&ei=Wz7PS6rNLYzcNcbyoTg

http://www.google.com/imgres?imgurl=http://library.thinkquest.org/06aug/00313/Olympic-rings.png&imgrefurl=http://library.thinkquest.org/06aug/00313/&usg=__AFmUpe3t4ovSQqUKV-GLE25iVBI=&h=600&w=900&sz=14&hl=en&start=2&sig2=b0JqNkx49WpSi_MFltzxkw&itbs=1&tbnid=lsdSbgta--o1GM:&tbnh=97&tbnw=146&prev=/images?q=olympic+rings&hl=en&gbv=2&tbs=isch:1&ei=KzvPS835PIb6NampnEA

http://www.google.com/imgres?imgurl=http://www.slowtrav.com/blog/bge/olympiclogo.jpg&imgrefurl=http://www.slowtrav.com/blog/bge/life_and_all_that_goes_with_it/&usg=__GK2hOnCzCkqo9b0AlbGd8uLCN2g=&h=388&w=396&sz=90&hl=en&start=7&sig2=FMmcsC2CudxAkYVubdxLJA&itbs=1&tbnid=sMuau2oxRCUFZM:&tbnh=121&tbnw=124&prev=/images?q=beijing+olympics+2008&hl=en&gbv=2&tbs=isch:1&ei=eTvPS9CDHYL4M6Gk5UE

http://www.google.com/imgres?imgurl=http://rise2.genomics.org.cn/page/rice/image/ricebar.jpg&imgrefurl=http://rise2.genomics.org.cn/page/rice/rise.jsp&usg=__iylMg584osqCh__F3VHBV5CWMMM=&h=288&w=352&sz=61&hl=en&start=14&sig2=Ke0fpS4Ht1HdDOBwyEzo6w&itbs=1&tbnid=YwDtjj5mmE8ppM:&tbnh=98&tbnw=120&prev=/images?q=indica+rice+genome&hl=en&gbv=2&tbs=isch:1&ei=LzzPS--_GqWKNa308C8

5

Environment

Water supply of Harbin City is polluted by local plant

China surpasses the United States in carbon

dioxide emissions

Earthquake strikes Sichuan province. Death

toll reaches 69,000

China surpasses the United States as the world’s largest producer of

household garbage

Earthquake in Qinghai province. 2,000 deaths, 12,000 injured,

100,000 homeless

2005 2006 2007 2008 2009 2010

http://www.topnews.in/law/files/China-Earthquake-Map.jpg

http://upload.ecvv.com/upload/Product/20093/China_Garbage_Truck20093121537246.jpg

http://www.google.com/imgres?imgurl=http://cache4.asset-cache.net/xc/56273099.jpg?v=1&c=IWSAsset&k=2&d=77BFBA49EF878921F7C3FC3F69D929FD3D6E8E24F8AD364CFF7AC9B90C57A956D8C20685CDC54C5BC6E7E4E2CE924510&imgrefurl=http://www.life.com/image/56273099&usg=__TlP9BvbISQvn4iC06GwiQzyATtg=&h=396&w=594&sz=45&hl=en&start=12&sig2=YgxT-MRdMd9YRtZpOxrVkQ&itbs=1&tbnid=9bpv8y_XIFyU0M:&tbnh=90&tbnw=135&prev=/images?q=harbin+city+songhua+river&hl=en&gbv=2&tbs=isch:1&ei=XVXPS6-zCIGeM-r2tDE

http://images.google.com/imgres?imgurl=http://www.treehugger.com/china-air-pollution-01.jpg&imgrefurl=http://priceofoil.org/2009/02/23/13-of-chinas-co2-emissions-%E2%80%9Cdue-to-west/&usg=__ZuErrMSq6nBXEnoLv7QMy8rin5A=&h=317&w=468&sz=20&hl=en&start=4&sig2=2wvSVdiy10tqiTZpr5l6XQ&itbs=1&tbnid=eocz4LcJVrip1M:&tbnh=87&tbnw=128&prev=/images?q=china+carbon+dioxide+emissions&hl=en&tbs=isch:1&ei=LlfPS8b5M5GENM7OlEg

6

Health

First cases of SARS

SARS Quarantines UN estimates 1 million Chinese are infected

with HIV

WHO predicts , around 50 million Chinese children will

die prematurely from tobacco use related disease

Joint UN Program, MoH & WHO, on

HIV/AIDS (UNAIDS) publish a report on AIDS.

China’s MoH 10th case of

Avian Flu

Tainted Milk

China has 90 million

diabetics

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

http://www.google.com/imgres?imgurl=http://www.shoprite.com/Cnt/images/diabetes.jpg&imgrefurl=http://www.shoprite.com/Cnt/DiabetesSeparatingFactfromFiction.html&usg=__jGkK-7I6PAEkbyfHE4L_HdY2D00=&h=300&w=290&sz=13&hl=en&start=7&sig2=3fV87HrKr_K7TDH8pj2jKQ&itbs=1&tbnid=xPZXxBBO8a1z0M:&tbnh=116&tbnw=112&prev=/images?q=diabetes&hl=en&gbv=2&tbs=isch:1&ei=eE3PS8b4NqLqNb-uwUE

http://www.google.com/imgres?imgurl=http://www.stanford.edu/~jliebner/coronaviridae/sarsmasks.jpg&imgrefurl=http://www.stanford.edu/~jliebner/coronaviridae/taxonomy.html&usg=__eXo6tT2vfiX09Y8UA6TX4y_6r5c=&h=334&w=400&sz=48&hl=en&start=6&sig2=DZVrz6Ov4TDACrCxHMHSlA&itbs=1&tbnid=PFRMwgxVAFx9nM:&tbnh=104&tbnw=124&prev=/images?q=SARS&hl=en&gbv=2&tbs=isch:1&ei=eUXPS-neE4rsNMzthTY

http://www.google.com/imgres?imgurl=http://www.chinadaily.com.cn/english/doc/2005-12/01/xin_36120201065953817951.jpg&imgrefurl=http://www.chinadaily.com.cn/english/doc/2005-12/01/content_499488.htm&usg=___tPcP_Yd2ajZCGPJzgj2s0cq_0w=&h=310&w=400&sz=34&hl=en&start=5&sig2=aZxqCiSdn779L19MSGt-Jw&itbs=1&tbnid=o2QvD0bBZ32s1M:&tbnh=96&tbnw=124&prev=/images?q=China+HIV&hl=en&gbv=2&tbs=isch:1&ei=gkjPS9S7BJW-Ms_G2UQ

http://www.google.com/imgres?imgurl=http://www.travelvivi.com/wp-content/uploads/2009/09/no_smoking.png&imgrefurl=http://www.travelvivi.com/smoking-regulations-in-new-york-city/&usg=__cO6x7mEE4mDdpQGrEzaeEXhZ2bw=&h=600&w=600&sz=36&hl=en&start=47&sig2=cSMTpNdj8EijpXclwJIh3Q&itbs=1&tbnid=s9kVCRTxzN5__M:&tbnh=135&tbnw=135&prev=/images?q=China+tobacco+children&start=36&hl=en&sa=N&gbv=2&ndsp=18&tbs=isch:1&ei=h0rPS9bNGozONa_J6TI

http://www.google.com/imgres?imgurl=http://politicolnews.com/wp-content/uploads/2009/04/china-tainted-milk_1000917c.jpg&imgrefurl=http://www.politicolnews.com/china-executes-greedy/&usg=__ju-q9XmoE0e1ja01fvy84qWYENs=&h=288&w=460&sz=29&hl=en&start=2&sig2=4j3gttsSqS5nvScAYmzCZA&itbs=1&tbnid=e9PszoL0iAKc6M:&tbnh=80&tbnw=128&prev=/images?q=china+tainted+baby+milk&hl=en&sa=N&gbv=2&ndsp=18&tbs=isch:1&ei=X03PS7bWOoSwNtyMuTQ

7

TechnologyGovernment consolidates

internet regulations

Firstever fiber optic network connection across Russian

Chinese border (internet)

1st manned spacecraft into

orbit

CERNET2 China’s high speed network connecting

25 Universities

China reaches 94 million

internet users

China reaches 103 million internet users, 45.6 million computer hosts and 677,500 web sites

China reaches 210 million internet

users

China is the malware capital

of the world

China celebrates fist domestically

produced passenger jet

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

http://images.google.com/imgres?imgurl=http://chinadigitaltimes.net/wp-content/uploads/2009/01/chinainternet.jpg&imgrefurl=http://chinadigitaltimes.net/china/online-public-opinion/&usg=__XzYUOam2hcJbJmNaP7tqG8n5580=&h=399&w=580&sz=58&hl=en&start=5&sig2=miRWCz5tyTvRWvf2rvb37A&um=1&itbs=1&tbnid=E_7fJB0TJSD16M:&tbnh=92&tbnw=134&prev=/images?q=china+internet+cafe&um=1&hl=en&tbs=isch:1&ei=PZHQS-fnC4HCMfusibwP

http://images.google.com/imgres?imgurl=http://www.nrc.tsinghua.edu.cn/7_english/images/CERNET2tuopu.gif&imgrefurl=http://www.nrc.tsinghua.edu.cn/7_english/Situation3.htm&usg=__sMinUCOj9J6_77ewnyf-5Fqxlwc=&h=459&w=673&sz=62&hl=en&start=1&sig2=nk9ccgARul5AKgr_3Isbuw&um=1&itbs=1&tbnid=Cu0745Ca1RR1gM:&tbnh=94&tbnw=138&prev=/images?q=CERNET2&um=1&hl=en&tbs=isch:1&ei=k4zQS-S8O5XyM5r5ibUP

http://images.google.com/imgres?imgurl=http://www.theepochtimes.com/n2/images/stories/large/2008/08/16/74356398rsf.jpg&imgrefurl=http://www.theepochtimes.com/n2/china/chinas-internet-censorship-backfires-2854.html&usg=__iFz02XazJ5I9xknTV6AmG9mRkdI=&h=484&w=750&sz=43&hl=en&start=31&sig2=hqgPvHRe83ogg13nShvFTg&itbs=1&tbnid=jxESy6fvk-Wo0M:&tbnh=91&tbnw=141&prev=/images?q=china+internet+censorship&start=18&hl=en&sa=N&ndsp=18&tbs=isch:1&ei=Tl_PS7acGpOeMrzLtUI

http://blenderpost.com/db/admin/news_thumbs/fiber.gif

http://images.google.com/imgres?imgurl=http://img.bleepingcomputer.com/swr-guides/antispy-pro/google-toolbar-malware.jpg&imgrefurl=http://www.bleepingcomputer.com/forums/topic119577.html&usg=__Sz1BG1LuJGZXD0rkZiu8pPY0vqU=&h=284&w=345&sz=36&hl=en&start=3&sig2=nWj0ExnBOyc4TKSHSHxJ2w&um=1&itbs=1&tbnid=djjrQE5JT6udmM:&tbnh=99&tbnw=120&prev=/images?q=malware&um=1&hl=en&tbs=isch:1&ei=JY7QS8q-IoLKM9f9gMcP

http://images.google.com/imgres?imgurl=http://www.xyberlog.com/wp-content/uploads/2008/china-internet-user.jpg&imgrefurl=http://www.xyberlog.com/category/internet/&usg=__-MvxHRitMv_Yj-fyJTV63-da_VU=&h=295&w=495&sz=65&hl=en&start=5&sig2=AQnOiXtxIY8Ry6rv6lVV-Q&um=1&itbs=1&tbnid=VcunaYrQlfLsgM:&tbnh=77&tbnw=130&prev=/images?q=china+internet+users&um=1&hl=en&ndsp=18&tbs=isch:1&ei=zo7QS5mSBpfqNcmurMoP

http://images.google.com/imgres?imgurl=http://news.xinhuanet.com/english/2007-12/21/xinsrc_202120421191250016711.jpg&imgrefurl=http://news.xinhuanet.com/english/2007-12/21/content_7290443.htm&usg=__UGgYcnvvUeygsrWzuQzGeFdOokA=&h=300&w=450&sz=65&hl=en&start=1&sig2=DtEDAPR6aAiceQ4CC--ZQg&um=1&itbs=1&tbnid=RIWD545LIwRrLM:&tbnh=85&tbnw=127&prev=/images?q=xiang+feng&um=1&hl=en&tbs=isch:1&ei=cY_QS8bTHYT2NafBxcwP

8

Military

China launches communication satellite

China launches GPS satellite

China intensifies modernization of People’s

Liberation Army

China launches third navigation

satellite

Government deploys troops to

protect Three Gorges Dam from terrorist attacks

Stateowned Galileo Industries begins cooperation with

EU’s Galileo navigation system

China shoots down old weather satellite,

demonstrates ability to destroy spy satellites

China’s military budget

increases by nearly 18%

China’s plans to increase military

budget another 18%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

http://images.google.com/imgres?imgurl=http://www.blogcdn.com/www.engadget.com/media/2008/02/satellite_explode.jpg&imgrefurl=http://www.engadget.com/2008/02/20/alien-or-zombie-threat-averted-the-spy-satellite-has-been-destr/&usg=__zgADl0gy24LcuoSkrVrkbDd10Vs=&h=353&w=440&sz=46&hl=en&start=8&sig2=d9GrZLQNiIutotiMqxXblw&um=1&itbs=1&tbnid=NukyE04fMXR6kM:&tbnh=102&tbnw=127&prev=/images?q=satellite+destroyed&um=1&hl=en&tbs=isch:1&ei=-5nQS-ybC5mUMpmewagP

http://www.spacetoday.org/images/Sats/China/ChinaSatArt.jpg

http://images.google.com/imgres?imgurl=http://gpssystems.net/wp-content/uploads/2010/02/china-compass-block-galileo.jpg&imgrefurl=http://gpssystems.net/china-disrupt-europes-global-navigation-satellite-system/&usg=__2SxHf4MCLSUe4URYU1ewSuDUNoA=&h=328&w=328&sz=27&hl=en&start=4&sig2=2i9xZ98JypqSTYvjO7hVig&um=1&itbs=1&tbnid=kVSrhlSkMo1d-M:&tbnh=118&tbnw=118&prev=/images?q=china+gps+satellite&um=1&hl=en&tbs=isch:1&ei=xZTQS_DoJoSKNvCKzbwP

http://images.google.com/imgres?imgurl=http://www.armybase.us/wp-content/uploads/2009/03/members-of-the-chinese-peoples-liberation-army-pla.jpg&imgrefurl=http://www.armybase.us/2009/03/china-to-boost-defence-spending-by-149/&usg=__5ELxFx4BozyCntfVBC-3uwvj67Y=&h=429&w=594&sz=57&hl=en&start=1&sig2=n2mi1vi-a5fPOp256IzAgg&um=1&itbs=1&tbnid=Rrti6K7_hHEP3M:&tbnh=98&tbnw=135&prev=/images?q=china+people's+liberation+army&um=1&hl=en&tbs=isch:1&ei=l5XQS6vaL5m6M6mGlbgP

9

Future Milestones

Monetary policy changes?

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

New Government

Housing market?Property taxes? Population aging

Population disproportionally

maleEnvironmental Protection Laws?

Labor forcepeaking

http://images.google.com/imgres?imgurl=http://risingpowers.foreignpolicyblogs.com/files/2010/01/fpa_china_bank_note.jpg&imgrefurl=http://risingpowers.foreignpolicyblogs.com/2010/01/12/chinas-dual-economy-could-falter/&usg=__j9FFfftEy-dLvqEXbli2sjZ2W1g=&h=327&w=290&sz=57&hl=en&start=12&sig2=ow97aObT-aQ_zsI0PI-mcg&um=1&itbs=1&tbnid=JxTX3z9A6MAmSM:&tbnh=118&tbnw=105&prev=/images?q=china+monetary+policy+2010&um=1&hl=en&sa=N&tbs=isch:1&ei=0z_XS56ZCZGENJafvMYF

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

GDP

per

Cap

ita (P

PP in

200

9$)

GDP per Capita (PPP in 2009$)

Brazil

IndiaChina

Russia

Source: Conference Board Total Economy Database

Japan (1960-1990)

1998 GM China Market Study: Urbanization Projections


10

15

20

25

30

35

40

45

5019

79

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

2009

Perc

ent U

rban

Pop

ulat

ion

in C

hina

ChinaIndonesiaThailandIndiaMalaysia

0

200

400

600

800

1,000

1,200

1,400

1,600

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Popu

latio

n (in

Mill

ions

)

China: Population

Population (in 10,000s)UrbanRural

13

0

10

20

30

40

50

60

70

80

90

10019

90

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Perc

ent (

%) o

f Tot

al P

opul

atio

n

Urban Population as a Percent (%) of Total Population

Brazil

India

China

Russia

197

229

180

0

50

100

150

200

250

2000 2005 2010 2015 2020

China: Population

P.R. China: Total Population Aged 15-19 (millions) P.R. China: Total Population Aged 20-24 (millions)

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

In T

hous

ands

Higher Education Students

China

Brazil

Japan

Germany/France/UK

Russia

India

U.S.

Source: Euromonitor

1998 GM China Market Study: Urban Household Income


0

1

2

3

4

5

6

7

81.

5 2 3 4 5 11

abov

e 12

annual household income (thousand US$ at market exchange rate)

num

ber o

f hou

seho

lds

at e

ach

inco

me

leve

l (m

illion

s)

urban 199820052010

18

1998 GM China Market Study: Rapid income growth led to continuous upgrades & fast saturation of electric & white goods

1970s 1980s 1990s 2000s (proj.)

B&W TV color TV large scn TV home Ent. Ctr

radio stereo radio/tape cable TV Internet /Web

bicycle motorcycle family car

sewing washing telephone cellular phonemachine machinewatch electric fan air conditioner PC

refrigerator kitchen equip. fitness equipmentUrban per capita income in mid-decade (PPP, 1995 US$)411 690 1566 3690

19

USA

W.E.

Brazil

RussiaIndia

China

Japan

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

Industry (000 units)

Source: GM Corporate Planning

Vehicle Sales in Major Markets

American & Chinese Spending Patterns

31%23%

9%

52%

39%

13%

10%

4%

11%

9%

13%

15%

19%

11%

13%

15%

14%

5%

7%

5%

4%

8%

17%

3%

7%

10%13%

11%

2%

5% 7%

9%

3%

3%

9% 10%

25%

12%22%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1940's - U.S. 1970's - U.S. 2000's - U.S. 1990's - China 2000's - China

Food

Clothing

Food

Clothing

HousingHousing

HouseholdItems

Health Care Health

Care

Transport

Transport

Leisure

Leisure

Other

Other

HouseholdItems

21

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

1965

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

Oil Consumption(thou barrels daily)

Brazil

Russian Federation

India

China

22

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Shar

e of G

DP (%

)China: Exports and Imports as a Share of GDP

Exports

Imports

EX + IM as % of GDP 2000 2009China* 40 57 US 20 19 Japan 18 22 India 20 33 Russia 53 36 Brazil 19 21 Euro Zone 60 56

2,416

0

500

1,000

1,500

2,000

2,500

3,000

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Billi

ons

of U

S$ (N

SA,E

OP)

China: Intl Liquidity: Total Reserves Minus Gold

Japan

Euro Zone

RussiaTaiwan

0

200

400

600

800

1000

1200

140019

70

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

Every Decade has Winners

Gold Nikkei 225 NASDAQ Energy Commodities

Five U.S. City Home Price

Index

Shanghai Stocks

What's Next?

Sources: Gold: London Gold Bullion Market; Nikkei 225,NASDAQ and Dow Jones Shanghai: WSJ/Haver Analytics; Energy Commodities: S&P GSCI Energy Commodities Nearby Index/Haver Analytics; 5 U.S. City Home Price Index: Average of Case Shiller Index/Haver Analytics for Miami, Las Vegas, Los Angeles, San Diego, and San Francisco

24Ted Chu, China Next Decade 5‐12‐2010

25

0

200

400

600

800

1,000

1,200

10-J

an-9

710

-Jul

-97

10-J

an-9

810

-Jul

-98

10-J

an-9

910

-Jul

-99

10-J

an-0

010

-Jul

-00

10-J

an-0

110

-Jul

-01

10-J

an-0

210

-Jul

-02

10-J

an-0

310

-Jul

-03

10-J

an-0

410

-Jul

-04

10-J

an-0

510

-Jul

-05

10-J

an-0

610

-Jul

-06

10-J

an-0

710

-Jul

-07

10-J

an-0

810

-Jul

-08

10-J

an-0

910

-Jul

-09

10-J

an-1

0

Stoc

k Mar

ket I

ndex

(Jan

uary

199

7=10

0)BRIC Stock Market Performance

Brazil

India

China

Russia

China: The Next Decade

Can be sustained

• Income growth

• Urbanization

• Higher education

• Military power expansion

• Climbing the value chain

Cannot be sustained

• Rate of labor force growth

• Share of trade in GDP

• Foreign reserve accumulation

• Environmental deterioration

• Widening of income disparity


What China needs: (1) social and geopolitical stability, (2) furtherstructural reforms, (3) psychological maturity

china in the global economy: the last ten years and the next

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