What can be said about a country that went from being an isolated rural nation to an economic giant that holds a 20% share of global GDP? Despite its problematic past, an ongoing trade war with the US, and several controversial issues raised around its business policies, the People’s Republic of China economic growth statistics are showing remarkable sustained progress over the last couple of decades.
In this article, you’re going to find out more about the history behind the economic success of the Asian Giant. We’ll also try to unveil some of China’s advantages and challenges it faces and give you some potentially surprising details about China’s relations with the US.
Top 10 Stats About China’s Economic Growth Rate
- China is currently the only country to reverse the impact that COVID-19 had on the economy with a 3.2% positive growth in 2020.
- China‘s GDP growth in 2021 (first quarter) reached a record of 18.3%.
- GDP growth rate dropped to 4.37% in 2022.
- China had an outstanding debt of $40 trillion in 2019.
- At 1,133, China is home to the highest number of billionaires.
- China is the largest holder of forex reserves with $3.4 trillion of foreign currency reserves.
- In 2020, The US trade deficit with China reached $310.8 billion.
- In 2020, China’s nominal GDP per capita was six times smaller than the one in the US — $10,484 vs. $63,416.
- It is predicted China’s labor force will decline to 700 million by 2050.
- Almost 1.25 million people die each year due to particle pollution in China.
China Economic Growth Statistics Explained
How big is China’s economy, and why is the country so prosperous?
1. China is currently the only country to reverse the impact that COVID-19 had on the economy.
(World Bank) (BBC) (NBSC)
Despite facing an abrupt 6.8% decline in Q1 of 2020, the Chinese government announced that their economy was back on track, marking a positive 3.2% economic growth no less.
The country’s total value of industrial enterprises in August 2020 grew by 5.6% compared to 2019. Likewise, their Index of Services Production increased by an additional 4%, which has been the driving force behind the economic shift from July to August.
China’s GDP growth rate in 2020 was affected by the challenges the economy faced because of the pandemic.
2. China earned $139 billion in 2018 from Foreign Direct Investments (FDIs).
Economic growth of China statistics shows how, in 2018, the country had the second-highest FDI inflow globally, with a total of $139 billion. The only country that surpassed this number was the US.
Despite the criticism and suspicions they face in foreign politics, China remains the second-largest global investor and a substantial financial source for technology companies worldwide — China invested $1.8 billion into US tech companies in the first quarter of 2019.
3. China‘s GDP growth rate in the last 10 years witnessed a significant decrease.
Since 2011, when the country’s GDP growth rate reached 9.55%, there’s been a significant decrease. The rate dropped to 7.85% in 2012 and 7.77% in 2013, after which there was a steady decrease (7.39%) in 2014 and in 2015 (7.02%).
The situation became slightly better in 2021 when GDP rates reached 8.08%. However, it didn’t last for long.
4. China’s GDP growth rate in 2022 dropped to 4.37%
(Statista) (Statista) (Statista)
In a similar fashion, in 2020, the growth rate amounted to a record low of 2.27%. On a positive note, in 2020, China’s GDP reached about $14.86 trillion, which was significantly more than other BRIC countries, like India ($2.6 billion), Russia ($1.47 billion), and Brazil ($1.44 billion.).
In addition to that, China took second place on the list of countries with the highest GDP in 2020, right after the US.
5. China runs the world’s biggest infrastructure investment project.
(BRI) (Green BRI Center)
The Belt and Road Initiative was first introduced in 2013 by China’s President Xi Jinping as the country’s way to accelerate infrastructure development, boost its foreign cooperation, and improve China’s economic growth graph.
As of 2021, 138 countries have officially joined BRI:
- 38 countries from Sub-Saharan Africa,
- 34 from Europe and Central Asia (18 countries from the EU)
- 25 countries from East Asia and Pacific
- 17 countries from the Middle East and North Africa
- 18 countries from Latin America and the Caribbean
- 6 countries from SouthEast Asia.
6. Greater China is home to the highest number of billionaires — 1,133.
As of April 2022, Greater China has the highest number of billionaires. Thanks to the economic growth rate of China, the country managed to steal first place from the former leader, the US, which currently stands at 716 billionaires.
Third-place belongs to India (215 billionaires), followed by the UK (150 billionaires), and Germany (145 billionaires).
On the other hand, Turkey (26), Spain (29), and South Korea (30) currently have the lowest number of billionaires.
7. Despite the perpetual economic growth in China, the country had an outstanding debt of $40 trillion in 2019.
The country’s total debt was estimated at $40 trillion in 2019. This means China is facing a debt that is 303% the size of its GDP, making up for 15% of the world debt.
8. Trading is one of the primary drivers of the country’s economy, with 4,500 shopping malls in 2019.
(Investopedia) (China Daily)
China has one of the largest shopping centers worldwide, from New Century Global Center in Chengdu to IFC Mall in Hong Kong.
Moreover, the country had about 4,500 shopping malls in 2019, and before the pandemic, 7,000 were expected to open within the next seven years.
And let’s not forget about one of the biggest boosters of the economic growth rate in China, the online retailer Alibaba, which in March quarter and full FY 2022, reported consolidated annual revenue of about $134,567million.
9. China is working toward becoming the “manufacturing superpower” by 2025.
(CRS Report) (The Diplomat)
In 2015, the Chinese government published a plan called “Made in China 2025,” explaining the intended upgrade and modernization of China’s manufacturing industry in 10 key sectors.
The document explains the goal of boosting the People’s Republic of China’s economic growth rate over time by becoming the number one manufacturer of power infrastructure and telecommunications by 2025 and using 70% domestic components by that same period.
10. In 2020, China had the largest percentage of GDP based on PPP—18.33%.
In 2020, China became the leading country in the world measured by the Purchasing Power Parity (PPP), and the country’s GDP based on PPP reached $24.1 billion.
Furthermore, the People’s Republic of China economic growth statistics report that the country held a share of 18.33% of the global GDP.
11. China is the largest holder of forex reserves with $3.4 trillion of foreign currency reserves.
China’s forex reserves reached $3.4 trillion in 2022, more than two and a half times than Japan, which was second on the list with $1.3 trillion.
At the same time, foreign currency reserves in the US amounted to $242 billion. In comparison, the UK had $217 billion in foreign reserves.
12. China was ranked 14th in terms of innovation in 2020.
(Global Innovation Index)
The latest edition of the GII 2020, observing the People’s Republic of China GDP growth rates, ranked them 14th in terms of innovation, characterizing it as a country with the most significant innovational progress over time.
Despite not being in the top ten, China ranks as number one among upper middle-income economies regarding the quality of innovation and number four among the 17 economies in East and Southeast Asia, and Oceania.
13. China‘s GDP growth in 2021 (first quarter) reached a record of 18.3%.
China’s economy went up by 18.3% in Q1 2021, compared to Q1 of 2020. This was the highest year-to-year growth since 1993.
Moreover, the total value of the country’s exports grew by 38.7% in Q1 of 2021. Amidst the pandemic, China became a manufacturing hub for work-from-home gears and masks, making it the only country that succeeded in enhancing its exports to the EU.
This was also the first time China became the largest trading partner in Europe.
14. China’s economic growth rate remains unprecedented in modern history, coming to $14.86 trillion in 2020.
(Harvard Business Review) (Statista) (The Balance)
Since the 1980s economic and free-market reforms, China’s GDP grew from $150 billion in 1978 to an estimated $14.86 trillion in 2020.
On top of that, the country’s economic growth reduced the poverty rates. For example, in 2019, only 0.6% of people lived under the poverty line.
On a negative note, in Q1 of 2020, the Chinese government, corporations, and consumers created a debt-to-GDP ratio of 317%, which resulted in higher prices for urban housing.
Furthermore, the economic growth is expected to decline abruptly in 2022.
The Economic Growth Rate — the US vs. China
What’s the main difference between the two country’s economies?
15. China used to be the number one US trade partner until 2019.
(BBC) (CRS Report)
However, this is no longer the case, partly because of the tariffs that the US imposed on over $250 billion worth of Chinese goods in the ongoing trade war between Washington and Beijing.
This is not to say that the two countries have completely stopped trading, and they still remain important partners. At the same time, this did initially slow down China’s rapid economic growth.
16. In 2020, The US trade deficit with China reached $310.8 billion.
The 2020 deficit was 9% lower than in 2019 ($345.2 billion) and the lowest since 2011.
The US imports from China amounted to $435.5 billion (computers, cell phones, and apparel were the largest imports), while the US exports to China reached $124 billion (commercial aircraft, soybeans, automobiles).
17. China‘s GDP in 2020 grew by 2.3%, whereas the GDP in the US dropped by 2.3%.
As we mentioned before, China was the only country that witnessed an increase in the economy during the pandemic.
While the US GDP amounted to $20.9 trillion in 2020, China was close behind with $14.7 trillion. In other words, China’s current economic growth rate is rapidly catching up with the US. The data for 2020 shows that the difference between economies is “only” $6.2 trillion.
18. In 2020, China’s nominal GDP per capita was six times smaller than the one in the US — $10,484 vs. $63,416.
Based on the predictions, in 2021, China’s GDP per capita should grow by $1,335, reaching $11,819. In contrast, the nominal GDP per capita in the US is predicted to go up by $4,893, amounting to $68,309.
Based on the same predictions, by 2026, the nominal GDP in the US and China should reach $27.6 trillion and $24.1 trillion, respectively.
China’s Economic Growth History and Challenges
What are the county’s biggest economic challenges?
19. Demographic challenges burden the economy, with a fertility rate drop to 1.6 billion in 2012.
The size of China’s workforce has been in decline for seven years in a row. In 2011 their working population (16–59) was 925 million people.
Due to a drastic drop in fertility rate, which went from 5.8 in 1964 to 1.6 in 2012, the labor force dropped to 897 million in 2018 and is predicted to keep dropping until it reaches 700 million by 2050. This will have a tremendous effect on the People’s Republic of China economic growth rates.
20. Income inequality reached alarming levels in 2008, with the Gini coefficient peaking at 0.491.
(Statista) (Science Direct)
The Gini coefficient (0–100) measures the distribution of wealth. The higher the coefficient, the higher the inequality. That said, China’s Gini coefficient in 2020 reached a score of 46.8 or 0.468 points. In other words, the country was above the warning level (40).
Furthermore, China economic growth statistics indicate that, since reaching its peak in 2008 (0.491), the numbers started to drop, reaching 0.465 points in 2019.
It should be noted that the US Gini index was also relatively stable in this period, rarely fluctuating far from 0.48.
21. Almost 1.25 million people die each year due to particle pollution in China.
(The Guardian) (The Interpreter)
The economic growth of China is closely linked to coal since the country’s economy basically runs on it. As a result, China is the number one polluter in the world. As one of the country’s primary energy sources, coal is responsible for the emission of airborne particles that are putting the health of 81% of Chinese citizens at risk.
22. In 2020, the unemployment rate in China’s urban areas reached 4.24%.
Although China‘s GDP growth rate witnessed an increase in 2020, due to the pandemic, the unemployment rate in the urban areas dropped to roughly 3.96% in 2021 and 3.7% in 2022.
Northeastern regions had a higher percentage of unemployment than the southern parts. For example, in 2020, Heilongjiang province had a high unemployment percentage of 3.4%.
The situation became even worse in February 2020, when the unemployment rate among young people (16–24) reached 13.1%.
How much does China’s economy grow each year?
On average, the Chinese economy grew at an annual rate of 10% since the 1980s. That said, in Q1 of 2021, the country’s economy reached a record growth of 18.3%, followed by an increase in industrial output (14.1%) and retail sales (34.2%).
At the same time, China was the only country that registered economic growth in 2020 (about 2.3%). Likewise, the country’s goal in 2021 is to reach economic growth of at least 6%.
How did China’s economy grow so fast?
The economy expanded thanks to a set of economic reforms introduced in the 1980s. One of the major turning points was attracting up to $139 billion a year in foreign investments and focusing on export activities, which rose by 9.3% in 2018.
What’s more, China’s economic growth is tightly linked to Shenzhen, which became one of the world’s leading innovation and technology hubs. Government intervention also had its say in the country’s economic growth by increasing their investments in research and development.
What is the GDP rate of China in 2022?
It’s expected that in 2022, the country’s nominal GDP will reach $19,91 trillion.
China’s nominal GDP rate amounted to $14.72 trillion in 2020, whereas the country’s PPP GDP reached $24.1 billion (an average annual growth rate of 9.92%). In 2020, China had the largest percentage of the GDP based on PPP—18.33%.
On the other hand, the country’s GDP per capita and GDP per capita based on PPP amounted to a mere $10,484 and $17,192.
How much has the Chinese economy grown since 2000?
In 2000, China’s GDP amounted to $1.2 billion. Since then, the numbers went up from $1.9 billion in 2004 to $3.5 billion in 2007 (the highest growth rate of 14.23%).
Since then, the numbers have fluctuated. How? The country’s economic growth in 2018 increased by a whopping 12.87%, only to witness a mere 2.77% increase in 2019.
Due to the pandemic, in 2020, China’s economic growth experienced an increase of only 3.1%.
How long before China becomes the biggest economy?
Some experts speculate that China will surpass the US by 2028, while others believe the US will remain on the top for the next 50 years. It’s hard to guess when and if China will surpass the US as the country with the best economy.
So far, the US has a higher nominal GDP than China —$20.9 trillion vs. $14.7 trillion. In addition to that, China has a six times lower nominal GDP per capita compared to the US—$10,484 vs. $63,416.
On the other hand, China managed to avoid the economic recession caused by the coronavirus outbreak, by becoming the only country that witnessed an increase in GDP (2.3%).
The Final Take
Although it’s practically a communist country, the People’s Republic of China economic growth statistics show that they have managed to make a unique combination of their political and capitalist economic models.
This has allowed them to embrace the free market and private ownership, cautiously keeping the government in the center of decision-making.
- China Daily
- CRS Report
- Global Innovation Index
- Green BRI Center
- Harvard Business Review
- Science Direct
- The Balance
- The Balance
- The Diplomat
- The Diplomat
- The Guardian
- The Interpreter
- World Bank