Since the founding of the People’s Republic of China, China’s GDP production structure has undergone three important changes.
First, the proportion of the primary industries has declined, and the proportion of the secondary and tertiary industries has increased. From the point of view of added value, the predominance of the national economy has shifted from the primary and secondary industries to the secondary and tertiary industries.
Second, the growth of the secondary industry (especially manufacturing) has become one of the main drivers of China’s rapid economic growth. According to comparable prices, of the 9.6% of GDP growth from 1979 to 2005, 5.3% came from the secondary industry, 3.1% from the tertiary industry, and 1.2% from the primary industry.
Third, the proportion of the primary and secondary industries in China’s industrial structure is relatively high, while the proportion of the tertiary industry is low, which indicates that the internal structure is imbalanced and the benefits are low Compared with the rest of the world, the added value of China’s tertiary industry accounts for a low proportion of GDP.
1. Agriculture
The overall size of the Chinese economy ranks among the best in the world. In it is a relatively high proportion of the agricultural economy. Agricultural development is closely related to the overall development of the Chinese economy. We can find the beginnings of China’s economic reforms in the rural and agricultural economies. The fruits of agricultural economic reform have provided a reliable material basis for national economic development. The continued development of the agricultural economy plays an important role in the stability and sustainability of China’s economic development. In recent years, China’s annual agricultural growth rate has been 4%, and agricultural labor productivity growth has remained at around 7%. China’s grain output has reached 1.2 trillion jin for five consecutive years (Note: 1 jin equals 0.5 kg). The level of agricultural mechanization exceeds 65% and the contribution rate of agricultural science and technology advances exceeds 56%. The effective irrigation coefficient of agriculture exceeds 52%, and more than half of the farmland is protected from drought and flood. The processing conversion rale of major agricultural products exceeds 60%. There are over 2.9 million new-type agricultural enterprises, and the proportion of moderate-scale land operations accounts for 40%. The business pattern of small, weak and scattered agriculture is undergoing profound changes.
China’s Food Problems
After the founding of the People’s Republic of China, the government abolished feudal land ownership and led the people to become strong and self- reliant, develop food production, and feed 22% of the world’s population with about 7% of the world’s arable land. In 1995, compared with 1949, China’s total grain output increased by more than three times, with an average annual increase of 3.1%. China’s total grain output ranks first in the world, with a per capita average of 380 kg (including beans and potatoes), reaching the world average; per capita meat production is 41 kg, aquatic products 21 kg, eggs 14 kg, fruits 35 kg, and vegetables 198 kg, all of which exceed the world average. China’s tremendous achievements in developing grain production have basically eliminated extreme poverty, drastically improved its citizens’ living standards, and made significant contributions to worldwide hunger and poverty alleviation.
Of course, the Chinese government also recognizes that the level of China’s food supply and demand balance needs to be further improved, and the tight supply and demand situation will exist for a long time. Therefore, the Chinese government has implemented the “Poverty Alleviation Plan”. By the end of 2013, 250 million Chinese people had been lifted out of extreme poverty. Poverty alleviation and development have effectively promoted the economic and social development of poverty-stricken areas, effectively alleviated the regional development gap, and improved the production and living conditions of the poor in poverty-stricken areas. At the same time, China is also the first country to complete the goal of halving poverty-stricken population in the UN Millennium Development Goals. In the future, China will further increase the total amount of food, produce a variety of foods, adjust the food structure, continue to improve the quality of life for its people, and develop towards a well-off, relatively rich society.
2. Industry
Since the late 1970s, China’s reform of its business management mechanism, its development of products and production factor markets, and its development of non-state-owned economies have all contributed to the rapid growth of China’s industrial economy. The diversification of the ownership structures in the industrial sector has taken shape, the industrial structure has been adjusted, the productivity of state-owned enterprises has increased, and the prosperity of rural industrialization has also taken shape. Since the beginning of the reform and opening-up, China’s industry has developed at a dizzying rate. Both the economic aggregate and the structure have leapt to a new level, establishing China as a world power in manufacturing, while laying a solid foundation to make it the world leader in manufacturing.
“Made in China”
China has become a huge industrial country, and its manufacturing scale is almost equal to the sum of the United States, Japan and Germany, while “Made in China” has become one of the most familiar labels in the world. China’s manufactured products have become the mainstay of export commodities, and China has amassed a large amount of foreign exchange.
Nearly half of China’s fiscal revenue comes from industry; in 2010, there were 90 million people employed in industrial enterprises with annual business incomes of more than 5 million yuan. Industry has helped to resolve the problem of a large pool of surplus labor, greatly alleviating China’s heavy employment pressure.
China emphasizes the promotion of the integration of informatization and industrialization, and unswervingly follows the new industrialization path of Chinese characteristics: high scientific and technological content, good economic returns, low resource consumption, less environmental pollution, and full utilization of human resources.
At present, China has built a comprehensive modern industrial system with considerable scale and level, and formed a complete industrial system and a rich supply chain, including raw material energy industry, equipment industry, consumer goods industry, national defense technology industry, and digital information industry. In various important areas, China has formed a number of industrial products with the highest production capacity in the world.
Chinese Intelligent Manufacturing
In the process of economic transformation, while the Chinese government pays attention to “Made in China”, it pays more attention to “Chinese Intelligent Manufacturing” (or “Created in China”), that is, supporting the research and development of core technologies in industry, and accelerating the transformation of scientific research results. More and more “Made in China” is transforming into “Created in China”.
China has built the world’s fastest computing supercomputers and spaceships, and has developed its own GPS system, the Beidou satellite navigation system. China’s manufacturing innovation capability has steadily increased, and the National Innovation Index ranks China 19th among the 40 major countries in the world. China’s R&D expenditure reached 1, 029.84 billion yuan, ranking third in the world. High-tech industry exports accounted for the largest share of manufacturing exports in the world, and the growth of knowledge service industry ranked third in the world. The application for Chinese invention patents has surpassed the United States for three consecutive years and is ranked first in the world.
3. The Tertiary Industry
China’s tertiary industry (service industry) has shown strong growth and has become a major aspect of China’s economic growth. At present, the total output value of China’s tertiary industry accounts for more than 50% of the GDP. While this is a great improvement, China still falls behind developed countries in this respect. Wholesale and retail industries occupy a large proportion of the tertiary industry, followed by financial and real estate industries. The biggest sector of China^ tertiary industry is the low value-added primary service industry. Currently, it is necessary to develop modern service industries such as finance and medical care. China’s tertiary industry has significant upside room, though its structure requires dramatic adjustment.
With the rapid development of the tertiary industry, new formats, new models, and new businesses in China’s service industry have emerged. Service applications and innovations based on big data, cloud computing, and the Internet of Things are increasingly active. New service models such as eco-tourism, retirement and elderly care, distance education, digital houses, and smart communities have developed rapidly and expanded consumption channels.