LAUSR

In 1820, China’s economy accounted for approximately one third of the world’s total gross domestic product (GDP) (Maddison 2007). After the first Opium War 1839–42, its GDP plummeted. China entered the so-called hundred years of national humiliation. By 1949 when the People’s Republic of China was founded, it had slipped to only about 4% of world output. Following 30 years of Maoist socialism and 40 years of reform, the Chinese economy has transformed in almost every aspect. It has gone from being one of the most closed and isolated economies in the world of little relevance to the global economy, to become a highly globalised economy. China’s economic size is already around 16% of the world economy and it is likely to become the world’s largest economy within the next decade (Maddison 2007; World Bank). After growing at nearly 10% per annum formore than 30 years, China’s growth has slowed down to between 6.5% and 7% per annum after 2012. The Chinese Government has been trying to manage the slowdown in its economy, and official statistics show that its economic growth came in at 6.6% in 2018 – the slowest pace since 1990 (NBS various years). The slow down itself may not be an insurmountable problem. As China’s gross national income increases, the slowdown in growth is normal, as it is said that Chinese economy has entered a ‘New Normal’ period. Based on the absolute value of extra national income, the current 6.6% increase is actually greater than 12% increase from 0 a decade ago. In 2005, the gross national product was 2.3 trillion U.S. dollars, an increase of 12% was about 270 billion US dollars. In 2018, China’s gross national product was $13.6 trillion, and a 6.6% increase meant a total increase of $898 billion. In this sense, the increase of $898 billion in 2018 is 3.3 times the increase of $270 billion in 2005. In 1997, the Chinese government set up two Centenary Goals which are to finish building a moderately prosperous society in all respects by the time the Communist Party of China celebrates its centenary in 2021 and to turn China into a modern socialist country that is prosperous, strong, democratic, culturally advanced and harmonious by the time the People’s Republic of China celebrates its centenary in 2049. China is on route to cross the benchmark of around $12,000 GDP per capita and enter the World Bank’s high-income country club in the next couple of years, given that its per capita GDP is $9750 in 2018, and the growth rate is still above 6% per annum. If a ‘moderately prosperous society’ is defined as the lower end of the high-income country level income, China looks like it is going to achieve the first Centenary Goal. However, China is still poor. Its per capita GDP is still below the GDP per capita of the world, and by this measure, China is ranked around 70 among all countries in the world. As the average GDP per capita of the OECD high-income countries is still many JOURNAL OF CHINESE ECONOMIC AND BUSINESS STUDIES 2019, VOL. 17, NO. 1, 1–7 https://doi.org/10.1080/14765284.2019.1582225