Economic growth in China and its impact on American economy Essay - 1

Economic growth in China and its impact on American economy - Essay Example The developed nations have understood that after the implementation of the quota free regime, the Republic of China has captured and secured major share of the industrial and production activities. The Golden Age of the China started soon after its amalgamation with World Trade Organization. The membership of World trade Organization has been of economic and industrial benefits for the country. Secondly, the normalization of the Communist China’s diplomatic relationship with United States, have further boosted the momentum of Chinese economic activities. These two events are important because they signify the recognition of Chinese economy by United States and the world economic community as an equal partner. Since its membership, the country has become an important member of the world economic community and plays an important role in the global economy. The partnership with WTO has increased the scope of China’s market for international trade and investment, and has opened up the World economy for unrestricted China’s exports. Economic analysts have viewed the so far progress positively, and considered it as a positive force for China’s economic development, however others believed that the competition of foreign imports and foreign enterprises in China might destroy important domestic enterprises in China’s agricultural, manufacturing and service sectors. WTO membership will hasten the relative decline of the agricultural sector and the relative rise of service sectors dealing with financial services and telecommunication. Secondly, the state sector will decline relatively to the non-state sectors and efficiency in Chinese enterprises will increase with foreign competition when tariffs are lowered and foreign firms can enter the Chinese market. Although the concerns of the analysts have come up to be true, however the Chinese government’s investment friendly policy and availability of local, cheap and skilled labor