China's Economic System

Great Essays
The great economic powers of the world, The United States, The United Kingdom, France, Germany, all followed a similar trajectory of development. In the west, civilizations grew from city-state to serfdom to sea trade to the industrial revolution. Inventions like the cotton gin and the steam engine propelled the western world into a new industrialized age, while countries in the east struggled through civil wars and the very complicated politics of trading with their western neighbors. In the west, industry brought about new standards of wealth that fought wars, built bombs, and became the envy of the world. By the end for World War II the U.S. was the wealthiest nation in the world. When the world’s leaders convened in New Hampshire to discuss …show more content…
Based on the size of their economies, a proportional voting system would have China and the U.S. share about 30% of the vote in most of these international institutions, but in reality China’s share is much smaller. China’s economy makes up 15% of global GDP, but only shares 4% of the vote in the IMF. The U.S. economy is 19% of global GDP and has 17% of the vote (IMF Members’ Quotas and Voting Power, Quandl). The IMF is a primarily western institution, it has a tradition of choosing its leadership from western countries, and a history of dispensing western ideals along with funding. This isn’t necessarily fair to China but for a western-centric institution it’s expected that adapting to power in the east might take time. The Asian Development Bank however, is not western centric and yet still not balanced in allowing China some influence. The ADB is structured specifically as a development bank, with developed lending members, and less developed borrowing members. China, though it’s economy surpassed Japan’s several years ago, is still considered a borrowing member with only 6% of the vote. Japan, a lending member, has 15.7% or the majority voting share. Even the U.S. has a bigger piece of the regional bank with 15.6% …show more content…
Within the report the institution noted that funds needed to be funneled into transportation, energy, and communications in the amount of seven trillion dollars order for the continent to grow in a sustainable way. This is a huge problem, not just for China but for most of southeastern asia. The demand for infrastructure is so high that the current institutions cannot provide the funds. The populations of China, India and all the nations in between are developing at a rapid pace and the infrastructure to support these people simply is not there. What is needed in Asia is more connections for cars, trucks, and trains to get goods and people between China and the surrounding countries. This would be excellent for Chinese industry and for its neighbors and investors but, there are a few roadblocks. This kind of money can only be collected by working with several multilateral development organizations and according to the ADB, a specific asian investment fund will be needed to accomplish this monumental task and the new superpower in town was up to the

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