INSTITUTE FOR INTERNATIONAL ECONOMICS
China in the World Economy Nicholas R. Lardy, Senior Fellow Institute for International Economics
1
Global Issues and the U.S. Outlook Global Interdependence Center and Macroeconomic Advisors Philadelphia, April 14, 2004
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
China's GDP Growth, 1992-2003 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 1992
2
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
The Growth of China Trade vs. World Trade 1977-2003 7000 6000
4000 3000 2000 1000 0 19 77 19 78 19 79 19 80 19 81 19 82 19 83 19 84 19 85 19 86 19 87 19 88 19 89 19 90 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 01 20 02 20 03 E
1977 = 100
5000
China Merchandise Trade
3
World Total Trade
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
Domestic Investment and Saving Share of GDP, 1979-2003 48% 46% 44% 42% 40% 38% 36% 34% 32% 30% 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 Gross Domestic Investment
4
Gross National Saving
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
People (Millions)
Agricultural Employment, 1978-2002 450
90%
400
80%
350
70%
300
60%
250
50%
200
40%
150
30%
100
20%
50
10% 0%
0
1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Agricultural Employment (LHS)
5
Percent of Total (RHS)
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
Scope of Import Quotas and Licenses, 1978-2005 50 45 40
30 25 20 15 10 5
20 05
20 04
20 03
20 02
20 01
20 00
19 99
19 98
19 97
19 96
19 95
19 94
19 93
19 92
19 91
19 90
19 89
0 19 88
Percent (%)
35
Encumbered Tariff Lines 6
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
China's Average Import Tariff Rate, 1982-2005 60
50
30
20
10
0 19 82 19 83 19 84 19 85 19 86 19 87 19 88 19 89 19 90 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 01 20 02 20 03 20 04 20 05
Percent (%)
40
Tariff rate
7
Tariff rate (WTO)
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
Openness of the Chinese Economy: Imports as a Share of GDP, 1990-2003 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 1990
1991
1992
1993
1994 Imports
8
1995
1996
1997
1998
1999
2000
2001
2002
2003E
Imports & Foreign Affiliates' Domestic Sales
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
M2 Growth, 1999-2003 22%
20%
18%
16%
14%
12%
10% 1999
9
2000
2001
2002
2003
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
Increase in the Stock of Domestic and Foreign Currency Loans Outstanding 3.5 3.0
RMB Trillions
2.5 2.0 1.5 1.0 0.5 0.0 1998
1999
2000 Domestic Currency
10
2001
2002
2003
Domestic and Foreign Currency
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
Increase in Loans Outstanding Relative to GDP, 1989-2003 25%
20%
15%
10%
5%
20 03
20 02
20 01
20 00
19 99
19 98
19 97
19 96
19 95
19 94
19 93
19 92
19 91
19 90
19 89
0%
Change in Loans Outstanding/GDP
11
Nicholas R. Lardy Institute for International Economics
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Investment as a Share of GDP, 1979-2003 48% 46% 44% 42% 40% 38% 36% 34% 32%
19 81 19 82 19 83 19 84 19 85 19 86 19 87 19 88 19 89 19 90 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 01 20 02 20 03
19 80
19 79
30%
Gross Domestic Investment Rate
12
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
Implicit GDP Deflator, 2000-2003 2.5%
2.0%
1.5%
1.0%
0.5%
0.0%
-0.5% 2000
13
2001
2002
2003
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
M2 Growth, January 2003-February 2004 24%
22%
20%
18%
16%
14%
12%
14
Fe b04
Ja n04
De c03
No v03
O ct -0 3
Se p03
Au g03
Ju l-0 3
03 Ju n-
-0 3 M ay
Ap r-0 3
-0 3 M ar
03 Fe b-
Ja n03
10%
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
Real Lending Rate, 2002-2004 10% 8% 6% 4% 2% 0% -2%
20 02 .0 20 2 02 .0 20 3 02 .0 20 4 02 .0 20 5 02 .0 20 6 02 .0 20 7 02 .0 20 8 02 .0 20 9 02 .1 20 0 02 .1 20 1 02 .1 20 2 03 .0 20 1 03 .0 20 2 03 .0 20 3 03 .0 20 4 03 .0 20 5 03 .0 20 6 03 .0 20 7 03 .0 20 8 03 .0 20 9 03 .1 20 0 03 .1 20 1 03 .1 20 2 04 .0 20 1 04 .0 20 2 04 .0 3
-4%
1-Year Loan Interest Rate - Change in Overall Corporate Goods Price Index
15
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
PRC Official Foreign Exchange Reserves 1991-2003 500 450 400
US$ billion
350 300 250 200 150 100 50 0 1991
16
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
Nicholas R. Lardy Institute for International Economics
INSTITUTE FOR INTERNATIONAL ECONOMICS
China's Foreign Exchange Reserves and Total RMB Loans Outstanding, 2001-February 2004 20
500
19
*
450
18
350
15 300
14 13
250
12 200
11
17
4 20 0
20 0
20 0
RMB Loans (LHS)
3
150 2
10 20 01
RMB Trillion
16
US$ Billion
400
17
Foreign Exchange Reserves (RHS)
* From 12/2003 on, foreign exchange figures are adjusted to reflect $45 bn transfer to SOCB.
Nicholas R. Lardy Institute for International Economics