Emerging Market Economy; a Case of China Essay Example | Topics and Well Written Essays - 2500 words

Emerging Market Economy; a Case of China - Essay Example This essay describes economic achievements of China on the way of successful transforming its economic system towards market economy, while establishing the reasons behind such success. Also the essay discusses the reasons that could lead to differences in mode of entry strategies of foreign direct investment between emerging markets and developed markets. It is shown in the essay, that China has had a rapid economic growth in the last three decades since the initiation of economic reforms in the year 1979. This fast rate of economic growth has caught the world's attention, and China is now a strong emerging economy almost closing the gap between it and the US. China is now a strong emerging economy almost closing the gap between it and the United States of America. It has become a major world economic power. There has been a tremendous improvement in the macroeconomic indicators over the past decade. From 2004, the China's GDP has been growing steadily at the rate of between 9.9% and 10%. There has also been a positive growth in net export, increase foreign reserves and of great significant increase in the outward Foreign Direct Investment. In the past decade, the country has benefitted from FDI and also had some negative spillovers as an emerging economy. Some of the benefits include the generation of exports and imports, labor mobility, horizontal and vertical integration, creation of more employment opportunities, capacity building of human capital and increase in Gross Domestic Investment among others.