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East Asia & Pacific is facing some great development challenges today: urbanization, protection of the environment, the need to find renewable energy sources and many others. This site wants to create a conversation around those important issues. More »

China

China grew faster than its target and most projections in 2009 – what are the key takeaways?

Submitted by Louis Kuijs on Tue, 2010-02-02 16:08
Click image to enlarge.

China’s economy grew 8.7 percent in 2009. This was more than the 8 percent target, despite the global recession that caused global output excluding China to fall about 3 percent. China’s growth outcome is substantially higher than projections made in early 2009. For instance, in our  World Bank quarterly economic update (of which I am the lead author) we projected 6.5 percent GDP growth and some other forecasts were even lower (see Figure 1).

How did these forecasts come about, and what lessons we can draw from the experience of China’s growth in 2009? I cannot speak for my colleagues at the World Bank, let alone for other economists. But, all in all, while I have learned important lessons, I am not sure how differently I would see and do things if again presented with a situation like we were in a year ago.

One year later: China’s policy stimulus results in strong 2009 economic growth, reason for optimism

Submitted by Gao Xu on Tue, 2010-01-26 11:07

This time last year, when the dismal 6.8% GDP growth data for China in the 4th quarter of 2008 came out, David Dollar, the former country director of China in the World Bank, asked in his blog whether one should interpret the data positively or negatively. (In other words, was the glass half full or half empty?) Compared with this uncertain situation a year ago, the Chinese economy is now in much better shape. Newly released data shows that the average GDP growth in 2009 is 8.7% – well above the most upbeat forecast made in early 2009. The growth even accelerated to double digits in the 4th quarter of 2009, standing at 10.7% (figure 1).

State-owned enterprises in China: How big are they?

Submitted by Gao Xu on Tue, 2010-01-19 17:03
In China's industrial sector, the shrinking share of state-owned enterprises (SOEs) is evident. This is due in part to the stronger growth of non-government-owned enterprises.

When communicating with my friends outside China, their misconception of Chinese State-Owned Enterprises (SOE) always surprises me.  It seems that although Chinese SOEs play a major role in the Chinese economy, they continue to remain mysterious to most outsiders. For some people – even some long-time observers of China – Chinese SOEs are best described as dying dinosaurs that continuously absorb resources from the economy but produce little economic value. However, this impression is far from the case in nowadays.

That’s why I feel obliged to write something about the reality of this myth. In this blog post and the following ones, I’ll try to profile Chinese SOEs with data mainly from industrial sector, addressing questions regarding their size, profitability, leverage, and so on, hopefully presenting a clear picture to readers.

Today, I will tackle the question of how big are Chinese SOEs. This question can be rephrased in two different ways. First, how big are Chinese SOEs as a whole in the Chinese economy? Second, how big are individual SOEs compared with non-SOEs? Starting with the former question:

East Asia & Pacific: Risks to economic recovery from the return to business-as-usual in developed countries

Submitted by Ivailo Izvorski on Wed, 2010-01-13 10:57

The prediction season is in full swing, and prognosticators have, as usual, appended the warning that economic forecasts at this stage are subject to exceptional uncertainty.  Such exceptional uncertainty is always with us when looking ahead – there is always a fork in the road, no matter what the circumstances are. 

The nuance this year is that, while the recovery in East Asia will depend on prospects for the rest of the world, notably in the advanced economies, the outlook for those economies hinges on policies to address the causes of the financial crisis. Thus far, it’s clear that very little has been done to redress the regulatory issues that led to a near meltdown of the global financial system – while the rebound from the financial and economic crisis has been substantially stronger than anticipated only months earlier.  And these developments explain why opinions differ on the future path of regulatory reforms and their impacts.

What does a video about a desert region of China have to do with Niger?

Submitted by Tony Whitten on Wed, 2009-12-16 14:24

A YouTube map that shows where people are when they view the videos. That the video might be of interest to a dry country like Niger – where herding of goats and other livestock is so important – is not so surprising.

A colleague of mine recently sent a link to a group of us showing some photos taken in Inner Mongolia, China, showing the land degradation being suffered there and its impacts.  One of the photos (#16) shows a twisted and broken tree trunk surrounded by sand on the edge of the Taklamakan Desert. The caption says that the trees were “killed by the moving sands.” I have a different take on it.

The picture shows what is probably a Euphrates Poplar, and I would suggest that the trees were probably killed by its surface roots becoming roasted after herds of goats and other livestock ate the trees' fallen leaves. These leaves would normally act as a natural insulation layer and mulch, and over time quite a number of plants grow in the shade and protection.  With the trees steadily roasted, so the whole area degrades and the sand blows in.  You can see one of the World Bank’s senior agriculturalists, Rick Chisholm, explaining this in the first of my two YouTube videos on Lake Aibi in northwest, Xinjiang, China.  (Go straight to 8m 30s on the time line to see the specific segment).

Empowering adolescent girls in East Asia and the Pacific to protect, build human capital

Submitted by Emmanuel Jimenez on Thu, 2009-12-10 14:30
Some recipients of a scholarship given to young girls in Cambodia at the end of primary school. The program has had a significant effect on girls’ secondary enrollment. (photo by Deon Filmer)

Those of us who have had the pleasure of raising an adolescent girl – and survived the experience – might blanch at the thought of a program to stimulate education that gave her, rather than the doting parent, a grant equivalent to 3% of the family’s average per capita monthly consumption. And yet, that’s exactly what a policy experiment, conducted by my friend Berk Ozler and other researchers, did in Malawi. What’s more, they found that raising these girl-targeted cash transfers increased school attendance much more than raising those given to parents.

Empowering women with resources has long been recognized as a powerful weapon to safeguard investments in human capital. Research has shown that transfers to women have a more powerful effect than to men in raising school attendance and ensuring that kids are immunized. But more recent research, like Berk et al.’s, is showing that policies aimed directly at adolescent girls and young women may have an even greater effect, not only in encouraging schooling but in ensuring reproductive health. Pascaline Dupas’ policy experiment in Kenya showed that simply giving young women information showing that older men were more likely to be HIV-positive led them to eschew partnering with ‘sugar daddies’.

Poll: Average citizens in China, Vietnam, Indonesia favor action on climate change, even if there are costs

Submitted by James I Davison on Wed, 2009-12-09 16:15

A few days before the start of the U.N. climate conference this week in Copenhagen, the results of an interesting – and very relevant – poll were released by the World Bank. While world leaders and other high-level representatives from more than 190 countries negotiate during the two-week conference (Dec. 7-18), this multi-country survey attempts to give a voice to average people in the developing world.

More than 13,000 people in 15 nations (most of which are developing countries) were asked a variety of questions, including whether climate change should be a concern, its urgency and what their governments should do about it. The poll also gives us a glimpse of what people in some East Asian countries – including Vietnam, China and Indonesia – think about climate change.

Overall, the majority of people polled said they want their government to take steps to fight climate change – even if that means an economic cost to their country. Some of the largest majorities of people who answered this way were in low-income countries, including Vietnam.

Here are a few other interesting findings from East Asian countries included in the survey:

China leads rapid growth of online audiences in Asia

Submitted by James I Davison on Tue, 2009-12-01 13:19

The online population in Asian and Pacific countries grew by 22 percent last year. China led the growth with an incredible 31 percent increase – to 220 million – in total unique Web visitors. These latest numbers of the region’s explosive Internet growth are according to a report, released last month by Internet researcher comScore, measuring online audiences in the region and individual countries between September 2008 and 2009.

The report indicates that Internet audiences in Japan, India and South Korea also saw double-digit growth and that the Asia-Pacific region now has 41 percent – or 441 million people – of the global Internet audience. It’s interesting to see how quickly things have changed since the last time we wrote about an earlier report from comScore.

If you want to examine more of the report’s findings you can see the related press release, or download a presentation on the subject here. (Note: To download the slides, you have to provide them with your name and some contact info.)

I’ve pointed before to World Bank evidence that shows the Internet may lead to improved economic growth, job creation and good governance. What else do you think such increased connectivity could mean for development in the region?

New Google feature lets users quickly search World Bank development data

Submitted by James I Davison on Tue, 2009-11-17 10:24

If you haven’t already taken the time to do some development-related Googling after last week’s announcement that World Bank statistics are now available through the ubiquitous search engine’s public data tool, I’d suggest exploring the exciting new feature. Now, anyone can easily access 17 World Development Indicators by searching for them in Google. Give it a try by searching for the GDP of China or CO2 emissions of Indonesia or exports of Thailand – or another country and any of these indicators.

When you click on the search result, an interactive chart page shows you how the data have changed over time and allows you to compare to other countries (or the world). (You can also embed the chart, like the one below.) For example, take a look at how the GDP growth rate of China compares to Indonesia, Thailand and the Philippines in the last 50 years.

To further explore the data, check out another nifty tool, also launched last week by the World Bank. DataFinder lets you research more about these development indicators and see how they look on an interactive map. Read more about DataFinder here.

China's engagement in Africa increases – and so does the debate around it

Submitted by Philip Karp on Tue, 2009-11-10 16:24

The issue of China-Africa engagement has been in the headlines this week as leaders from China and from across the African continent gathered in Egypt for the Fourth Heads of State Summit of the Forum on China-Africa Cooperation (FOCAC) where Chinese Premier Wen Jiabao announced China’s latest round of pledges of development support to Africa, including US$10 billion in concessional loans over the next three years. This latest round of pledges will no doubt further accelerate China’s growing importance as a source of trade, investment, and aid to African countries.

The magnitude of China’s engagement is indeed impressive. Two-way trade between China and Africa has grown at more than 40 percent per year since the year 2000, reaching nearly US$107 billion in 2008. Chinese foreign direct investment in Africa is also growing rapidly, topping US$5.4 billion last year, according to China’s Minister of Commerce, and more than 1,600 Chinese companies are reported to have invested in Africa. China has been particularly significant as a source of financing for investment in infrastructure, having announced commitments just shy of US$16 billion over the period 2001-2006, according to study released last year by the World Bank’s Africa Region (pdf).