Benefits and Costs of Investing in China Essay

In call of economic performance, mainland china has been performing impressively compared to its neighbouring countries in Asia and thunder mug compete at par with top developed countries like linked States and United Kingdom in terms of volume of condescension and sources of warlike advantages. Likewise, due to its tumid population sixe and high disposable income of every Chinese household due to its impressive economic development for the away days, mainland mainland China tenderises great potential market to many multinational companies seeking for lifesize number of customers. This will provide multinational companies high sales and utility from operating in China.Alongside with the influx of external direct enthronisation in China, Chinese share of trade on their gross domestic product dogging to increase every year as multinational firms increases the international employment transactions of China to the rest of the world. Furthermore, due to Chinas large popula tion, it has been able to offer cheaper laborers and large potential market which are both(prenominal) bring inive to foreign investors leading to the improvement of their foreign direct investments for the past years since the late 1990s. Without this comp onenessnt, it is impossible for China to attain its present commonwealth and achievements.Since 1999, the GDP growth rate of China has been performing impressively as foreign direct investments stabilized major economic indicators, specifically the trade balance and domestic consumption, which are vital in determining the overall performance of a given economy. This only suggests that China can offer high return on investments to investors in the next coming years as Chinas GDP growth rate persisting to increase every year.Due to the effort of the Chinese administration to attract more foreign investors into their market, it has been extensively supporting the development of its communication groundwork by providing subsi dies to telephone companies. This would soon boost the business activities all over the domestic market of China.CostsCompared to communication infrastructure, material infrastructure of China seems to develop at a slower rate thereby could interrupt for the fast growth of foreign investments in China. Though the Chinese government is also on the process of improving their facilities in this area, but, overall it is cool it lower compared to the development of their communication facilities as mentioned above.On the communist government, one of the primary factors that scare foreign investors in putting their capitals in China due to rampant corruption and insufficient laws that would protect the interest of foreign investors. Add to this the weak economic freedom, which could draw potential investors away of China if the situation continues to exist in the next coming years.Per capita GDP in urban areas are undeniably high but considering the conditions of those households from the rural areas, overall, per capita GDP of China is not in good condition as wealth distribution is silence skewed towards to the households in the urban areas.Another be or disadvantage in the Chinese economy is the high splashiness rate which has been one of the economic problems of China that it presently faces due to its fast-paced economic growth. This could pose either as beneficial or damaging to foreign investors depending on the type of product they will sell in the Chinese market and the size of their operation in China.In terms of infrastructure, most of the major waterways of China are on the process of dull formation as the Chinese government wants to utilize its waterways efficiently oddly the river systems in the mainland. The Chinese government is still on the process of maturation its roads and highways especially those roads that would connect different provinces to major cities. It would still take a few more years before this physical infrastructure will be fully developed.ReferencesBodde, Derk. Introduction. Chinese Thought, Society, and Science The skilful and Social Background of Science and Technology in Pre-modern China. Honolulu University of hello Press, 1991. pp 3-4.Qiang, Christine Zhen-Wei. Chinas Information Revolution Managing the Economic and Social Transformation. Herndon, VA, ground forces World Bank, The, 2007. p 2.