THE
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First is the study by Wong Xiao, a Chinese native who currently [December 2005] lives in San Francisco; this study presents the Chinese government's economic policies as compared to the MIEPA list of policies as outlined above. The study on China by Wong Xiao is shown immediately below. The study by Student B follows. The ratings herein are based on the following rating scale:
RATING SCALE
5.0 Perfect Facilitation of Wealth Creation
4.0 Midway between Perfect and Neutral
3.0 Neutral Effect on Wealth Creation
2.0 Midway between Neutral and Obstructionist
1.0 Perfectly Obstructionist to Wealth Creation
[Rating scale copyright Mike P. McKeever, 2005. Used herein with permission]
To read a disclaimer about the analysis in this file, scroll to the bottom of the file.
China - Wong Xiao
Comparison of China's economic policies to MIEPA criteria as prepared by native student of China, Wong Xiao, studying in the US in December of 2005.
RATING SUMMARY
POLICY NUMBER RAW SCORE ADJUSTED SCORE POSSIBLE PERCENTAGE
1 1.0 3.0 15.0 20 %
2 1.0 3.0 15.0 20
3 2.0 6.0 15.0 40
4 2.0 6.0 15.0 40
5 5.0 15.0 15.0 100
6 4.0 12.0 15.0 80
7 4.0 12.0 15.0 80
8 3.5 10.5 15.0 70
9 2.5 7.5 15.0 50
10 5.0 15.0 15.0 100
11 5.0 15.0 15.0 100
12 5.0 10.0 10.0 100
13 5.0 10.0 10.0 100
14 3.5 7.0 10.0 70
15 3.0 6.0 10.0 60
16 4.0 8.0 10.0 80
17 2.0 4.0 10.0 40
18 2.0 4.0 10.0 40
19 3.0 6.0 10.0 60
20 4.0 8.0 10.0 80
21 2.0 4.0 10.0 40
22 1.5 3.0 10.0 30
23 2.0 4.0 10.0 40
24 2.0 4.0 10.0 40
25 2.0 4.0 10.0 40
26 5.0 10.0 10.0 100
27 2.5 5.0 10.0 50
28 5.0 10.0 10.0 100
29 3.5 3.5 5.0 70
30 2.0 2.0 5.0 40
31 4.0 4.0 5.0 80
32 2.0 2.0 5.0 40
33 4.0 4.0 5.0 80
34 4.0 4.0 5.0 80
TOTAL 108.0 231.5 375.0 62.0%
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INDIVIDUAL POLICIES
1. Freedom from internal control 1.0
In China, it¡¯s very hard for people to move to another place, especially the big cities like Beijing, Shanghai, and Guangzhou. According to the law, each person from countryside must pay a big mount of money¡ªabout $800 in order to get a registered permanent residence in cities. This policy has created a barrier for people to get their wealth.
Source: http://www.cpirc.org.cn/news/rkxw_gn_detail.asp?id=5882
2. Freedom of Speech 1.0
Chinese constitution states that Chinese citizens have the freedom of speech. However, in fact, the government does not allow any people to say anything bad about it. If a person criticize the government in the public or say something different from the government¡¯s policy, the person will be caught.
Source: http://www.open.com.hk/2004_11p56.html
3. Effective, Fair Police Force 2.0
Chinese police is famous for its corruptions. Though sometimes the police are effective in pursuit of criminals, they often corrupt. When a person murders another person, he can escape from punishment by the judicial system if he have a good relationship with the police or pay the police.
Source: personal knowledge
4. Private Property Right 2.0
According to Chinese constitution, private properties are protected by the law. However, the government can confiscate a person¡¯s property by forcing the court to adjudicate that his property is illegal. Thus, private property in China is not under protected effectively.
Source:http://www.epochtimes.com/gb/4/3/27/n493610.htm
5. Commercial Banks 5.0
There are four major state-own banks and other private banks in China. People trust these banks and deposit their money in the banks; the banks land money to provide financial support for business. Commercial banks stimulate the economic growth.
Source: http://report.cei.gov.cn/2004report/report/d/d01.htm
6. Communication System 4.0
Chinese communication system is developing quickly as its economy is booming. Every household has TV sets and radios. People can buy newspaper and magazines in all towns. About 1/5 of the population has telephones and 1/10 has cell phones. Also, more and more households have computers, and high-speed internet can be accessible in most part of the country.
Source: personal knowledge.
7. Transportation 4.0
In order to develop its economy, Chinese government builds a modern, sufficient transportation network. China has 25 thousand kilometers of freeways, a huge national highway and rail networks, hundreds of seaports, and about 472 airports. People can easily visit and transport goods to most of the business and population centers.
Source: http://www.iicc.ac.cn/05development_western/t20050327_17571.htm
8. Education 3.5
The Chinese has tried hard to provide each citizen a good education and has invested lots of money in education, so Chinese have received more and better education than before. Chinese students have higher reading skills than American students do. Also, most students finish al least 9 years of education, and more and more people can go to universities. However, since the capacity of the universities and students¡¯ poverty, only 9.7% of students can enroll in and finish their study in universities, and more important, many universities are not renowned for excellence in the world. As a result, China has to make a greater effort to improve its higher education system.
Source: http://www.china.org.cn/chinese/2001/Sep/59980.htm
9. Social Mobility 2.5
In China, though the society has considered education very important and required each person to have their abilities to work, many unskilled people can still get their jobs because they have good relationships with other people working in companies and in the government. In addition, many people can not get higher education due to poverty, so they have fewer opportunities than others.
Source: personal knowledge
10. Freedom from Outside Control 5.0
Because China has a strong military, and its economy is booming, no foreign country can control China. Also, any foreigners violating the laws should be sentenced only according to Chinese laws and only by Chinese judicature.
Source: personal experience.
11. Foreign Currency Transaction 5.0
In China, only the RMB can be used as money in economic activities. Any foreign currencies must be converted to RMB in order to conduct business.
Source: www.asia-plant.net
12. Border Control 5.0
China has a strict border control. All the foreigners must get a visa to enter China, and the government can stop any people who it considers being unwelcome from entering China.
Source: http://travel.state.gov/travel/tips/regional/regional_1173.html
13. Currency 5.0
China has only one currency---RMB which is issued by the government. The exchange rate of RMB is also controlled by the government.
Source: http://en.wikipedia.org/wiki/Renminbi
14. Cultural Language Homogeneity 3.5
China has more than 1.3 billion people and the third largest territory in the world, so there are hundreds of dialects in China. However, since the government has made a good effort to teach people Mandarin, most people can speak Mandarin, and so people from different areas can communicate with each other. Also, Chinese culture is centered in Han culture, and many other ethnic minorities have common cultural background with Han people.
Source: personal knowledge.
15. Political Effectiveness 3.0
Chinese government has made a good effort to solve the problems in economy. The government builds lots of freeways, highways, railroads, airports, and seaports to improve the traffic system. Also, the government builds lots of power stations in nation wide to provide enough energy for factories. But the government does not solve social problems, like education, effectively, so many contradictions have existed in China.
Source: http://www.usc.cuhk.edu.hk/wk_wzdetails.asp?id=2853; personal knowledge.
16. Institutional Stability 4.0
Chinese government considers stability as the most important goal of the country, so under leaded by the communist party, schools, courts, government, and other organizations are stable, and most of them last for more than 50 years in China.
Source: personal experiences
17. Honest Government 2.0
In China, corruption exists in all branches of the government. Because of bad political system, officers can easily corrupt, and in fact, nobody believes that an officer does not corrupt. Though the central government has set up a commission against corruption, officers continue to corrupt because they can control courts. Thus, Chinese government needs to take further actions to fight corruption.
Source: http://atchinese.com/2004/01/0115china2.htm
18. Common Law 2.0
In recent years, the Chinese government made lots of laws in order to stimulate the economy and protect people¡¯s wealth. According to laws, all citizens are treated equally. However, because the government controls the courts, the courts can not jury effectively and impartially. Thus, the legal system in China needs improvement.
Source: http://www.sachina.edu.cn/Htmldata/news/2005/04/256.html
19. Central Bank 3.0
China¡¯s central bank---People¡¯s Bank of China---is controlled by the government, so it is not independent and is influenced by politics. However, the bank can manage the economy quite well. Since 1990¡¯s, the central bank has stimulated economic development and kept the inflation in low level.
Source: http://www.nova.cn/Browse/ShowDoc.aspx?Code=3-15&Id=2005081509132049727
20. Domestic Budget 4.0
In 2004, government revenue was $318.42 billion, and the expenditure was 342.64 billion. The budget deficit was low. Also, the inflation rate was 4.0%. So, Chinese domestic budget was pretty good in 2004.
Sources: http://www.hbtv.com.cn/misc/2005-03/06/content_361096.htm; http://news.xinhuanet.com/fortune/2004-01/12/content_1270672.htm
21. Government Debts 4.0
In 2004, China had government $372 billion government debts which are 31% of the GDP, and the interests of these debts were about $15.6 billion, 4.19% of the GDP. So, Chinese government has managed its debts quite well.
Source: http://www.mof.gov.cn
22. Economic Statistics 1.5
Like western countries, Chinese government announces economic statistics frequently; however, few people believe the statistics. Because there is no independent observer rating its statistics, Chinese government can fake any information if it wants, so business in China can have higher risk.
Source: http://www.epochtimes.com/gb/2/3/30/n180100.htm
23. Protection of Public Health and Safety 2.0
As a developing country, China faces lots of difficulties in protecting public health and safety. Many food manufactories use poisonous materials to produce food and beverages, which causes many Chinese die every year. The central government tries to keep food safe, but since the corruption in the local governments, local officers don¡¯t inspect food productions. Thus, public health is not protected well in China.
Source: http://finance.news.tom.com/1327/20041125-117326.html
24. High Wage Policy 2.0
Because there are more than one billion peasants in China, Chinese workers receive low wages from their employers. Since China began its economic reform, millions of peasants move to cities to look for jobs every year. In fact, there are too many people seeking for employments, Chinese employers pay their employees very little, especially to the blue colors. Many employees get only $100 per month, and they can not even support themselves. Though this situation can harm the stability of Chinese society, the Chinese government keeps the low-wage policy in order to attract foreign investments, so the economy can grow quickly.
Source: http://news.xinhuanet.com/comments/2005-07/13/content_3210390.htm
25. Environmental protection: 2.0
With the booming of economy, pollutions in China are increasing. In order to develop economy, people exploit forest and pollute the water and the air. Most of the rivers in china have been polluted seriously; the air is dirty, especially in big cities. To protect the environment, Chinese government has made the ¡°Environmental Protection Law¡± and spent much money, but since the country is so large and the economy is booming, the government¡¯s efforts can not solve the environmental problem
Source:http://news.xinhuanet.com/zhengfu/2003-06/17/content_923571.htm
26. Strong Army: 5.0
Undoubtedly, Chinese army is one of the strongest armies in the world. China has many advanced fighters, submarines, tanks, and other conventional weapons. Also, China has nuclear bombs. Now, China is modernizing her army in order to catch up with western countries. Because of her strong military force, China can protect her citizens and business.
Source: personal knowledge
27. Foreign Trade Impact: 2.5
Since China joined the WTO, her trade has grown very quickly. In 2004, the foreign trade of China was 1154.74 billion which was 80% of the GDP. We can see that Chinese economy almost completely relies on foreign markets, and this situation is too dangerous for Chinese economy.
Sources:http://news.xinhuanet.com/fortune/2005-01/11/content_2447041.htm; http://www.china.org.cn/chinese/sy/966551.htm
28. Protection of Foreign Currency Earning Enterprises: 5.0
China develops her economy through exporting, so the Chinese government protects her exporting companies. China subsidizes these companies, lends them low interest loans, and gives them tax refund. Also, most importantly, Chinese government controls her foreign exchange rate and keeps the rate low. Under these protections, Chinese exporting companies have lots of advantages in competition with foreign companies.
Source: http://media.163.com/05/0325/09/1FM91H8400141E16.html
29. Management of Foreign Currency Budget: 3.5
In 2004, China had import of $593.36 billion and export of $561.38 billion, having a trade surplus of $31.98 billion. This surplus is a bit large, so China has not managed its foreign currency budget well enough.
Source: http://finance.sina.com.cn/g/20050112/08121287713.shtml
30. Layers of Collective Action 2.0
In China, citizens can only elect village officers, and other officers, including judges, are appointed by the government and the China Communist Party. The government says that Chinese people have not enough knowledge to vote, but this excuse is not accepted by people.
Source: personal experience
31. Pro Business Climate 4.0
In China, business plays an important part. The government considers business as the tool to make China stronger and invites many business leaders to be economic advisors. Also, Chinese people support the development of business because they think that business can create more jobs and increase their income. Therefore, the business climate in China is positive.
Sources: personal experience
32. Government Enterprises 2.0
As a communist nation, China has lots of state-owned companies. Though private business are emerging, state-owned business still controls the important industries------oil, coal, steel, automobile, finance, and communication. However, many state-owned companies can neither earn profits, nor pay their debts. To save these companies, Chinese government invested 125 billion U.S. dollars between 1998 and 2003, but the financial conditions of these companies have been improved obviously.
Sources:http://www.secrectchina.com/news/gb/articles/5/9/2/125792.html
33. International Security Agreement 4.0
China does not sign any international security agreements, but she uses methods to improve her relationships with other countries. China has held security-strategy talks with the U.S., Russia, France, the U.K., Australia, Germany, Canada, Japan, and many other countries; China has established solid partnerships with most nations in the world. With these efforts, China has improved her relationships with other countries and reduced war risks.
Sources: http://news.xinhuanet.com/zhengfu/2004-12/27/content-2385569-9.htm; personal knowledge
34. Protection of Domestic Enterprises from Government Mandated Costs 4.0
The corporate tax rate in China is 33% which seems pretty high; however, lots of Chinese companies don¡¯t need to pay for Social Security tax, and they are not responsible for their employees¡¯ health care. In addition, the Chinese government imposes tariffs on imports to protect native companies.
Sources:http://cn.biz.yahoo.com/020905/99/18an3.html; http://finance.dayoo.com/gb.content/2005-01/04/content_1881720.htm; personal experience.
China - Student B
Comparison of China's economic policies to MIEPA criteria as prepared by native student of China, Student B, studying in the US in December of 2005.
RATING SUMMARY
POLICY NUMBER RAW SCORE ADJUSTED SCORE POSSIBLE PERCENTAGE
1 1.5 4.5 15.0 30 %
2 1.0 3.0 15.0 20
3 1.5 4.5 15.0 30
4 3.5 10.5 15.0 70
5 3.0 9.0 15.0 60
6 4.0 12.0 15.0 80
7 2.0 6.0 15.0 40
8 2.5 7.5 15.0 50
9 1.0 3.0 15.0 20
10 5.0 15.0 15.0 100
11 3.0 9.0 15.0 60
12 3.5 7.0 10.0 70
13 4.0 8.0 10.0 80
14 5.0 10.0 10.0 100
15 5.0 10.0 10.0 100
16 3.8 7.6 10.0 76
17 1.0 2.0 10.0 20
18 2.0 4.0 10.0 40
19 2.5 5.0 10.0 50
20 3.0 6.0 10.0 60
21 3.8 7.6 10.0 76
22 4.0 8.0 10.0 80
23 2.0 4.0 10.0 40
24 1.0 2.0 10.0 20
25 1.5 3.0 10.0 30
26 5.0 10.0 10.0 100
27 3.0 6.0 10.0 60
28 2.0 4.0 10.0 40
29 4.6 4.6 5.0 92
30 2.0 2.0 5.0 40
31 3.0 3.0 5.0 60
32 2.5 2.5 5.0 50
33 5.0 5.0 5.0 100
34 2.5 2.5 5.0 50
TOTAL 99.7 207.8 375.0 55.0%
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INDIVIDUAL POLICIES
1. Freedom from internal control: 1.5
Every citizen has a identification card stating the place where he/she was born. it is their registered permanent residence. It is difficult to for them to move out of their registered permanent residence and settele down in other places, especially in big cities such as Beijing and Shenzhen, which allows only a few people to be ammited to be a resident of the city. It requires lots of documentation and it is a big process to change the their registered permanent residence.
Source: http://study.szonline.net/content/2004/200407/20040720/132535.html
2. Freedom of speech: 1.0 Freedom of speech are strongly controlled by the government. It will get some trouble to speak something not good to the government in public. Words such as "freedom," "democracy," "human rights," and "Taiwan independence" are forbidden.
Source: http://freedomspeace.blogspot.com/2005/07/freedom-of-speech-ha.html
3. Effective, fair police force: 1.5
Even though their job is tire, difficult and dangerous, the policemen in China don't gain people's respectation. people think the policemen should do everything for them when they have difficulty. And they always complain the police force are not effective enough to prorect them or solve the problems. To work as a policemen is not easy in China.
Source: http://read.hjsm.net/book/1908/html/1001.html
4. Private property rights: 3.5
China will constitutionally guarantee - enshrine - the right to hold private property. This would mark the first time China has taken this formidable reform step since the 1949 communist revolution declared all land to be state-owned.
Source: http://www.atimes.com/atimes/China/FC05Ad05.html
5. Commercial Bank : 3.0
China's banking system expanded rapidly from 1985 to 1993, as the number of branches of state banks rose from 60,785 to 143,796 and the number of employees increased from 973,355 to 1,893,957. During the same period, total deposits increased from 427.3 billion yuan (US$51.6 billion) to 2.3 trillion yuan, while total loans increased from 590.5 billion yuan to 2.6 trillion yuan, reflecting the rapidly increasing role of the banking system in the economy. http://www.atimes.com/china/DF01Ad05.html
6. Communication System: 4 Communication is very convenient in China. there are lots of convenient ways to communicate: internet, mail, telephone etc. Today, there are 200 million telephones in China, and 80 million mobile handsets, making China the second biggest in the mobile market.The Internet will be increasingly linked to mobile communication, Also, banking services and stock trades are able to be executed on mobile handsets in China.
Source: http://www.weforum.org/site/knowledgenavigator.nsf/Content/_S4251?open
7. Transportation: 2.0 Transportation is not so convenient in China. Besides walking, the main source of transportation is the bicycle in major cities , and it makes a real traffic jam. Motorized bicycles, motorcycles and other motorized vehicles are growing in numbers.Trains are a key method of transportation between cities. Subway systems exist only in the major cities. They are insufficient for the population to take significant advantage. Domestic carriers provide service to every province and major city in the country. China is currently investing significant funds in creating and upgrading their 1.117million miles of roads, highway and expressway systems, 75% of which are unpaved. the roads and highways are rugged and congested.
Source: http://chinaunique.com/business/transit.htm
8. Education: 2.5 China carries out the nine-year compulsory education program. The total number of graduates from colleges and universities in 2004: 2.8 million, which is about 25% of the total population. Number of Students in Colleges and Universities is 4.13 million, which is about 33% of the total population. The education quality is pretty good in China. Comparing to the USA, the ration of the colleges and universities students are much lower, because there is great restriction to enter a university in China.
Source: http://www.chinatoday.com/edu/a.htm
9. Social Mobility: 1.0
Job market is not fair to everybody. those with family connection or rich people will be easier than those poor but capable people. It is not neccessary to have a family connection to get a good job, but if you do have, your chance to enter jobs in government or big companies will be much higher. Family connection plays an important role when hiring people.
Source: personal experience
10. Freedom from outside control: 5.0 The People's Republic of China maintains diplomatic relations with most countries in the world, she maintains one of the largest standing army in the world and has great military power. And she also maitains independent political and diplomatic policy.China is free from other country's control.
Source: http://en.wikipedia.org/wiki/People's_Republic_of_China#Foreign_relations
11. Foreign Currency Transaction: 3.0 China plans to ease tight controls on foreign currency lending and deposit rates from September 21, as part of the country's phased plans to allow free trading in the Chinese yuan. Financial institutions will, from now on, be able to set their foreign currency lending rates in line with the international market.
Source: www.expressindia.com/fe/daily/20000907/fec07052.html
12. Border Control: 3.5 Chinese government work hard at the border control and try her best to solve any problems. In an attempt to stop cross border smuggling, trading, transporting and producing drugs, and drug-related crimes, China, Laos, Myanmar and Thailand meet together and try to solve this problem.
Source: http://archives.cnn.com/2001/WORLD/asiapcf/east/08/27/china.drug/
13. Currency: 4.0 The currency in China is Chinese "Renminbi" (RMB), which means "People's Currency". Current exchange rate is 100DOLLAR=830RMB. 14. Cultural language homogeneity: 5.0
Mandarin is a category of Chinese dialects spoken across most of northern and southwestern China. Standard Mandarin is the official spoken language of China. There is a common "Mandarin" identity based on language, though there are strong regional identities centered around individual Mandarin dialects. The same language help unite all people in the country.
Source: http://www.centipedia.com/index.php?title=Mandarin_Chinese
15. Political effectiveness: 5.0
The Chinese government is effective when solving problems. The government's efforts to promote rule of law are significant and ongoing. After the Cultural Revolution, China's leaders aimed to develop a legal system to restrain abuses of official authority and revolutionary excesses.
Source: http://www.state.gov/r/pa/ei/bgn/18902.htm
16. Institutional Stability: 3.8 Since the 1980, Chinese institutes, such as government, court etc, are stable because the chinese people are willing to have a peaceful, stable society. The institutes are mainly controlled by the Chinese government who has great military power, and military factors still occupy an important position in state security.
Source: http://menic.utexas.edu/~bennett/__338/ch_white.htm
17. Honest government: 1.0
Chinese government is not honest enough to her people. many facts are hidden or covered by the government because the media, such as newspaper, magazines, films are controlled by the government. The government has the right to cancel anything not good to its stablility before it goes to the people.
Source: personal experience
18. Common laws: 2.0
The common law is equal in theory, but in the reality, when the law is practised, it tends to protect the rich people and people who has high authority or reputation. at many times the justices are not justified enough. they tends to protect the rich and authorised.
Source: personal experience
19. Central bank: 2.5
The People's Bank of China is the central bank. It formulates and implements monetary policy, prevents and resolves financial risks, and safeguards financial stability. It plays an important role in China's macroeconomic management. the PBC performs its functions independently according to laws and free from intervention by local governments, government departments at various levels, public organizations or any individuals.
Source: http://www.pbc.gov.cn/english/renhangjianjie/arrangement.asp
20. Domestic budget management: 3.0
In 2004, China has revenues: $317.9 billion and expenditures: $348.9 billion, including capital expenditures of NA (2004 est.). China experience a budget dificit in 2004 but fortunately the amount is not too big. And the budget management is still uner the government's control.
Source: http://www.indexmundi.com/china/budget.html
21) Government debt: 3.8 China has an external debt $233.3 billion (3rd quarter 2004 est.), and the public debt is about 31% of its GDP(7.262 trillion). The China government doesn't have too much debt. The Government have the ability to pay its debt because domestic government borrowing is relatively low. China can afford to pay off this bad debt.
Source: http://www.indexmundi.com/china/
22. Economic statistics: 4.0
Economic statistics shows a booming economic in China. The purchasing power parity is $7.262 trillion (2004 est.) Measured on the purchasing power parity (PPP) basis, China in 2004 stood as the second-largest economy in the world after the US, although in per capita terms the country is still poor. Foreign investment has helped spur output of both domestic and export goods.
Sorce: http://www.indexmundi.com/china/economy_overview.html
23. Protection of public health and safety: 2.0
In 2005, China has a Infant mortality rate 24.18 deaths/1,000 live births, male: 21.21 deaths/1,000 live births and female: 27.5 deaths/1,000 live births. The rate is pretty high conparing to the developed countries. This rate is often used as an indicator of the level of health in a country. The birth rate is 13.14 births/1,000 population (2005 est.), and the death rate is 6.94 deaths/1,000 population (2005 est.)
Source: http://www.indexmundi.com/china/infant_mortality_rate.html
24. High wage policies: 1.0
In China's system of underpaid, overworked, forced factory labor, workers are paid at a very low wages. The workers, mostly young women from rural areas, are forced to labor as many as 18 hours a day with little or no rest, and get some of the world's lowest wages ? 15 cents to 30 cents an hour. The basic workers' rights are routinely and systematically denied in China.
Source: http://www.uaw.org/solidarity/04/0604/feature08.cfm?frmdefault=0&text=1&frmfont=0&frmcolour=0&frmimage=1#ptop
25. Environmental protection: 1.5
China suffers from major energy-related environmental problems. According to a report by the World Health Organization (WHO), seven of the world's ten most polluted cities are in China. The country's heavy use of unwashed coal leads to large emissions of sulfur dioxide and particulate matter. China also is important to any effort to curb emissions of greenhouse gases.While the Chinese government is concerned with its environmental problems, it tends to be more concerned with local problems, such as particulate matter and sulfur dioxide emissions. Thus, it is undertaking efforts to lessen emissions of pollutants such as sulfur dioxide and nitrogen oxide.
Source: http://www.eia.doe.gov/emeu/cabs/china.html
26. Strong army: 5.0
China has great military power that is enough to protect the country. china is developing advanced information technology and long range precision strike capabilities, and looking for ways to target and exploit the perceived weakness of technologically superior adversaries.
Source: http://www.defenselink.mil/pubs/20030730chinaex.pdf#search='chinese%20military%20power'
27. Foreign trade impact: 3.0
Foreign trade impact is about 25% of its GDP in 2005. Merchandise Exports (2005F): $757.6 billion, Merchandise Imports (2005F): $674.7 billion Gross Domestic Product (2004E): $1.65 trillion (2005F): $1.89 trillion
Source: http://www.eia.doe.gov/emeu/cabs/china.html
28. Protection of foreign currency earning enterprises: 2.0
Breaking with previous policy, China in July 2005 delinked its currency from the U.S. dollar, resulting in a devaluation of 2.1 percent. The Chinese Yuan now will float within a very narrow band against a basket of currencies from the country's major trading partners. now the Exchange Rate (7/27/05): US$1 = 8.12 Yuan/Renminbi. the floating rate is better than the fixed rate in the world trade, and it is good to the foreign currency earning enterprises.
Source:http://www.eia.doe.gov/emeu/cabs/china.html
29. Management of foreign currency budget: 4.6
Merchandise Exports (2005F): $757.6 billion , Merchandise Imports (2005F): $674.7 billion. Merchandise Trade Surplus (2005F): $83.0 billion. China has a trade surplus $83 billion in 2005, the foreign currency budget is well managed.
Source: http://www.eia.doe.gov/emeu/cabs/china.html
30. Layers of collective action: 2.0
China has allowed direct elections by the people at the village level ,but not allowing people elections one administrative level up, such as the township level. the Communist Party is in charge of appointing officials, not the people. national leaders are chosen in a ceremonial election by the National People's Congress. the Communist Party is not ready to give the people real decision-making power. political reforms are urgently needed.
Source: http://seattlepi.nwsource.com/national/139892_china17.htm
31. Trust In Business people: 3.0
Nowadays most people respect the business people because they are smart, brave, and they have strong economic ability and social ability.But Chinese people look down at business people in the old days because business people have nothing but money. There is a old saying in china that "no trickery, no business." so people think the business people are tricky traders and don't trust them rashly. http://cqbbs.soufun.com/3110037953~1074/4337006_4341952_1.htm,
Source: http://www.sc.xinhuanet.com/content/2004-10/31/content_3129485_1.htm
32. Governmental Enterprise: 2.5
For years, Governmental Enterprises have low effecincy in production. they primarily produce one or few product which is not good in competition in the market. their capital is solely rely on the government. many companies don't worry about the revenue because they have the government to support them, or they could overstate the revenue. but nowadays, china has a much more conpetitive and free market place. many private companies arise. these many enterprises need to reform, otherwise they can't survive.
Source: http://www.cnhubei.com/aa/ca182105.htm
33. International security agreement: 5.0
China has a powerful military base. Emphasizing the people's power is the base of chinese military power,china is working hard in high technology militarization, such as biological and chemical weapon. but the great military development won't threat any other countries in the world because china always emphasize peace and frendily development together. the purpose of the fast military development is to protect the safety of the country, not to attack or annex any other country.
Source: http://army.news.tom.com/Archive/1021/2002/10/22-91820.html
34. Protection of domestic enterprise from government mandated cost: 2.5
In the business market, many companies are not honest and don't follow the contracts when doing business. the most important reason is that the Government haven't set up a reliable law to punish these companies.the punishment are so light that people are benefit more from the illegal action than what they pay for.
Source: http://www.ccn86.com/news/research/20050721/14626.html
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