China in the News

Announcing their GDP target for 2012 is eight percent.

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Appointed to a second five-year term in March of 2008, Premier Wen Jiabao was on task to showcase his country, China, to the world thru the 2008 Olympic Games. On Monday March 5, 2012, Premier Wen Jiabao was again in the news offering his thoughts at The Assembly of the National People’s Congress. China’s Gross Domestic Product target for 2012 was 8.0%. Making news was the announcement that their GDP was readjusted 7.5%. This GDP target is announced annually in March and comes off the heels of the previous year’s GDP of 9.2 in 2011 and 10.4% in 2010. Keep in mind that the USA’s GDP was 3.00% in 2010 and 1.7% in 2011. This shift of China to the world’s second largest economy as of 2010 has been a 30-year evolution that began with a two-phase economic reform that started in 1978.

Another notable takeaway from the speech includes efforts to keep inflation at 4% instead of 5.4% as recorded in 2011. Inflation in the United States was 3% in 2011. An increase in rural areas and promoting social stability was also a key concern conveyed in the speech. To do this they will increase public spending on security by 11.5% and increase the military budget by 11.2%. These are staggering increases. Can you imagine what it must be like for a country’s poverty rate to fall from 53% in 1981 to 2.5% in 2005? All this while, as of 2009, 150 million people still live on less than $1.25 per day. It is no wonder that with the political changes seen in Egypt and Libya there is concern for social unrest and the threads of more democracy to seed.

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