Prior to the initiation of economic reforms and trade liberalization 33 years ago, China maintained policies that kept the economy very poor, stagnant, centrally controlled, vastly inefficient, and relatively isolated from the global economy. Since opening up to foreign trade and investment and implementing free market reforms in 1979, China has been among the world’s fastest-growing economies, with real annual gross domestic product (GDP) averaging nearly 10% through 2011. In recent years, China has emerged as a major global economic and trade power. It is currently the world’s second-largest economy, largest merchandise exporter, second-largest merchandise importer, second-largest destination of foreign-direct investment (FDI), largest manufacturer, largest holder of foreign exchange reserves, and largest creditor nation. This book provides background on China’s economic rise; describes its current economic structure; identifies the challenges China faces to keep its economy growing strong; and discusses the challenges, opportunities, and implications of China’s economic rise for the United States.
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