Saturday, June 20, 2009

China Economic Structure

Most of the agricultural production is restricted in the east. china is the world's largest
producer of rice and wheat, among cash crops, china ranks first in cotton and tobacco and is an important producer of oilseeds, silk, tea, ramie, jute, hemp, sugarcane, and sugar beets. china ranks first in world production of red meat (including beef, veal, mutton, lamb, and pork). Due to improved technology, the fishing industry has grown considerably since the late 1970s. Apart from crops and food products, china is one of the world's major mineral-producing countries. Coal is the most abundant mineral (China ranks first in coal production). There are also extensive iron-ore deposits; the largest mines are at Anshan and Benxi, in Liaoning province. Oil fields discovered in the 1960s and after made china a net exporter, and by the early 1990s, china was the world's fifth-ranked oil producer. Growing domestic demand beginning in the mid-1990s, however, has forced the nation to import increasing quantities of petroleum. Coal is the single most important energy source; coal-fired thermal electric generators provide over 70% of the country's electric power. China also has extensive hydroelectric energy potential. Major industrial products are textiles, chemicals, fertilizers, machinery (especially for agriculture), processed foods, iron and steel, building materials, plastics, toys, and electronics. ROLE OF STATE vs MARKET Until 1978, industrial output was dominated by large state-owned enterprises (SOEs). Gradually, the share of state-owned and state-holding enterprises in gross industrial output value had shrunk; in 2002 it was around 41%. However, state-owned companies, controlled by economic ministries in Beijing (Capital of China), represented only 16% of industrial output. State-holding enterprises may control large numbers of state firms, and are not 100% state-owned. The changes in economic policy, including decentralization of control and the creation of "special economic zones" to attract foreign investment, led to considerable industrial growth, especially in light industries that produce consumer goods.

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