China Economic Condition & Compare With Australia Economic Condition

Question: Discuss about the china economic condition and compare the china and Australia economic condition, identify similar trend and GDP during same time period . Answer: The Chinese Economy China is is the worlds largest economy by nominal GDP and by purchasing power parity (PPP). It has a low inflation rate along with a low level of unemployment. The population below poverty line in china has been around 51% with a public debt of 16.7% of GDP in 2015 Though china has faced considerably high real GDP growth rates in the previous year, but the growth has slowed in recent years ,with only 6.7% growth in 2016 .The reason for this can be attributed to a significant decline in the manufacturing and construction output. It is observed that the middle class consumers of china is experiencing increase in their income and it has become worlds second largest importer and largest exporter and of merchandise goods along with being the worlds top receiver of FDI. The Australian Economy The country of Australia comprises the mainland of its continent and many other islands including the Tasmania Island. It is considered as the thirteenth largest economy whose per capita income keeps it in ninth position all over the globe with a relatively low level of poverty. The Australian economy has gone through a wide range of changes in its structure of production which can be accredited to reasons like technological changes, or becoming highly integrated to the global markets, competition from countries with lower wages in manufactured goods production and also changes in consumption pattern (Trudgian, 2016). Unemployment rate is considered as a crucial indicator of an economys excess capacity (Sowell, 2010). According to ABS data, besides the unemployment rate the trend with the GDP growth rates from 2005 to 2016 can also be correlated. As we see in 2009 with the high unemployment rate in Australia can be attributed to the negative growth rate of -13.7% whereas highest unemployment rate of 6% in 2014 is accompanied by a recessionary phase in the economy with a fall in growth rate by 9%. In 2015 with a considerably very high growth rate of 14.6% in real GDP resulted in the unemployment rate at 5.8%. Australian Economy Vs. Chinese Economy China and Australia is found to adapt very differenteconomic system by allowing different degrees of government interference and market forces so as to solve their basic economic problems. China posses higher government interventions due to their communist ideologies while Australian believe in more market system. The figure below shows the GDP of both the economics: Figure 1: - GDP of Australia vs. GDP of China In reality, though we find higher GDP for china, but considering other indicators like per capita GDP, environmental efficiency standard of living and the entrepreneurial resource efficiency, Australia is far ahead than china. It is also found that Australian economy is relatively well positioned in terms of equity when compared at global level. References Reserve Bank of Australia, 2013, Statement on Monetary Policy Box 3, viewed 20 May 2017, https://www.rba.gov.au/publications/smp/2013/nov/box-b.html. Sowell, T 2010, Basic economics, Basic books, USA. Chowdhury Subhanil (2015) : An overview of Contemporary Chinese Economy, Taken from a paper read at a seminar titled, OUR ECONOMY, THEIR ECONOMIES LESSONS TO LEARN TEACH at Heramba Chandra College on 14th January 2015.