I asked you to do a little bit of research And take a look at things have changed in China. One of the things you might have discovered is that until right about the year 1800, China had been, for 1800 years, by far the world’s biggest economy– the most dominant economy. They were more dominant then than America’s ever been, for instance. But the next couple of hundred years, they lost that dominance. And frankly, until not so long ago, 20, 30 years ago, China wasn’t really a big deal for the world. To most people, China was simply a five-letter word on a map. That all changed, of course.
We all know about the subject of post-1980, post-1990 expansion of China on the brink of becoming the world’s biggest economy. Not necessarily the richest, but certainly the biggest economy, and overtaking America in the event. And China, as we also know, is a member of, in fact, the most important member in terms of size, of a group we know as BRICS– Brazil, Russia, India, China, and more recently, South Africa. And for quite some time, we’ve been saying that, in the longer term, world economic growth and development will have increasingly its origin in places like China. But, since around about 2011, 2012, the pace of growth in China has been slowing down.
After many years of 10% growth, they moved down to something close to 7% by 2015. The expectation is that this growth rate will continue on a downward trend. Now, so what, you might ask? What are the implications? Well, while China was huge and growing, they were also, very importantly, a major consumer of natural resources. And, in the event, they bought lots and lots of natural resources from Africa, and that’s helped to boost Africa’s economic growth path during the first 10, 11 12 years of the 21st century.
So if China’s growth rate were to slow down, chances are pretty good that their demand of natural resources will slow down and that would have an unfortunately slightly more negative impact on the economy of Africa. Then we have an example, of over a long period of time, how we see changing events, in this case, China’s economic growth rate. I’ll give you a quick example of how we need to analyze that. Think about the implications, the broad implications, for the world economy and for that of Africa. Also many other implications that to China there’s a concern that with slowing growth, population of China, 1.4 billion people, might start getting restless and might start demanding major changes.
As long as a growth rate is 10%, they’re happy enough. At 8% or less, perhaps less, I assume we can start asking questions regarding democracy in China, or lack thereof, and the potential demand for democracy. We could get on with this story. Later on in this course, we’ll be taking a look at various economic issues and political issues, and we’ll probably revisit China, its economy, and its impact on the rest of the world. But for now, just a few thoughts to illustrate, number one, if things change, and number two, how we try to analyze the impact on that change, on this case, the broader global society.