2006/7 Geo

2006-11-29T00:59:00.000-08:00

Megalopolis

Dateline: 02/15/99

French geographer Jean Gottmann (1915-1994) studied the northeastern United States during the 1950s and published a book in 1961 that described the region as a vast metropolitan area over 300 miles long stretching from Boston in the north to Washington, D.C. in the south. This area (and the title of Gottmann's book) is "Megalopolis."

The term Megalopolis is derived from Greek and means "very large city." A group of Ancient Greeks actually planned to construct a huge city on the Peloponnese Peninsula. Their plan didn't work out but the small city of Megalopolis was constructed and exists to this day.

Gottmann's Megalopolis (sometimes referred to as BosWash for the northern and southern tips of the area) is a very large functional urban region that "provides the whole of America with so many essential services, of the sort a community used to obtain in its 'downtown' section, that it may well deserve the nickname of 'Main Street of the nation.'" (Gottmann, 8) The Megalopolitan area of BosWash is a governmental center, banking center, media center, academic center, and until recently, an immigration center (a position usurped by Los Angeles in recent years).

Acknowledging that while, "a good deal of the land in the 'twilight areas' between the cities remains green, either still farmed or wooded, matters little to the continuity of Megalopolis," (Gottmann, 42) Gottmann expressed that it was the economic activity and the transportation, commuting, and communication linkages within Megalopolis that mattered most.

Megalopolis has actually been developing over hundreds of years. It initially began as the colonial settlements on the Atlantic seaboard coalesced into villages, cities, and urban areas. Communication between Boston and Washington and the cities in between has always been extensive and transportation routes within Megalopolis are dense and have been in existence for several centuries.

When Gottmann researched Megalopolis in the 1950s, he utilized U.S. Census data from the 1950 Census. The 1950 Census defined many Metropolitan Statistical Areas (MSAs) in Megalopolis and, in fact, MSAs formed an unbroken entity from southern New Hampshire to northern Virginia. Since the 1950 Census, the Census Bureau's designation of individual counties as metropolitan has expanded as has the population of the region. In 1950, Megalopolis had a population of 32 million, today the metropolitan area includes more than 44 million people, approximately 16% of the entire U.S. population. Four of the seven largest CMSAs (Consolidated Metropolitan Statistical Areas) in the U.S. are part of Megalopolis and are responsible for over 38 million of Megalopolis' population (the four are New York-Northern New Jersey-Long Island, Washington-Baltimore, Philadelphia-Wilmington-Atlantic City, and Boston-Worcester-Lawrence)

Gottmann was optimistic about the fate of Megalopolis and felt that it could work well, not only as a vast urban area, but also as the distinct cities and communities that were parts of the whole. Gottmann recommended that

We must abandon the idea of the city as a tightly settled and organized unit in which people, activities, and riches are crowded into a very small area clearly separated from its nonurban surroundings. Every city in this region spreads out far and wide around its original nucleus; it grows amidst an irregularly colloidal mixture of rural and suburban landscapes; it melts on broad fronts with other mixtures, of somewhat similar though different texture, belonging to the suburban neighborhoods of other cities. (Gottmann, 5)

Furthermore, Gottmann also introduced two developing Megalopoli in the United States - from Chicago and the Great Lakes to Pittsburgh and the Ohio River (ChiPitts) and the California coast from the San Francisco Bay area to San Diego (SanSan). Many urban geographers have studied the concept of Megalopolis in the United States and have applied it internationally. The Tokyo-Nagoya-Osaka Megalopolis in an excellent example of urban coalescence in Japan.

The term Megalopolis has even come to define something much more broadly found than just the northeastern United States. The Oxford Dictionary of Geography defines the term as "any many-centered, multi-city, urban area of more than 10 million inhabitants, generally dominated by low-density settlement and complex networks of economic specialization." (Mayhew, 276)

Edge Cities

There were a hundred thousand shapes and substances of incompleteness, wildly mingled out of their places, upside down, burrowing in the earth, aspiring in the earth, moldering in the water, and unintelligible as in any dream. - Charles Dickens on London in 1848; Garreau calls this quote the "best one-sentence description of Edge City extant."

They're called suburban business districts, major diversified centers, suburban cores, minicities, suburban activity centers, cities of realms, galactic cities, urban subcenters, pepperoni-pizza cities, superburbia, technoburbs, nucleations, disurbs, service cities, perimeter cities, peripheral centers, urban villages, and suburban downtowns but the name that's now most commonly used for places that the foregoing terms describe is "edge cities."

The term "edge cities" was coined by Washington Post journalist and author Joel Garreau in his 1991 book Edge City: Life on the New Frontier. Garreau equates the growing edge cities at major suburban freeway interchanges around America as the latest transformation of how we live and work. These new suburban cities have sprung up like dandelions across the fruited plain, they're home to glistening office towers, huge retail complexes, and are always located close to major highways.

The archetypal edge city is Tysons Corner, Virginia, outside Washington, D.C. It's located near the junctions of Interstate 495 (the D.C. beltway), Interstate 66, and Virginia 267 (the route from D.C. to Dulles International Airport). Tysons Corner wasn't much more than a village a few decades ago but today it's home to the largest retail area on the east coast south of New York City (that includes Tysons Corner Center, home to six anchor department stores and over 230 stores in all), over 3,400 hotel rooms, over 100,000 jobs, over 25 million square feet of office space. Yet Tysons Corner is a city without a local civic government; much of it lies in unincorporated Fairfax County.

Garreau established five rules for a place to be considered an edge city:

The area must have more than five million square feet of office space (about the space of a good-sized downtown)
The place must include over 600,000 square feet of retail space (the size of a large regional shopping mall)
The population must rise every morning and drop every afternoon (i.e., there are more jobs than homes)
The place is known as a single end destination (the place "has it all;" entertainment, shopping, recreation, etc.)
The area must not have been anything like a "city" 30 years ago (cow pastures would have been nice)

2006-11-20T08:57:00.000-08:00

Tokyo http://en.wikipedia.org/wiki/Tokyo

Tokyo has the largest metropolitan economy in the world: its nominal GDP of around US$1.315 trillion is greater than Canada's economy, which is the 8th largest in the world[2]. It is a major international finance center, is site of the headquarters of several of the world's largest investment banks and insurance companies, and serves as a hub for Japan's transportation, publishing, and broadcasting industries.

During the centralized growth of Japan's economy following World War II, many large firms moved their headquarters from cities such as Osaka (the historical commercial capital) to Tokyo, in an attempt to take advantage of better access to the government. This trend has begun to slow due to ongoing population growth in Tokyo and the high cost of living there.

Tokyo was rated by the Economist Intelligence Unit as the most expensive (highest cost-of-living) city in the world for 14 years in a row ending in 2006.[3] Note that this is for living a Western corporate executive lifestyle. Many Japanese get by fine on a budget in Tokyo, underpinning the high national savings rate.

The Tokyo Stock Exchange is the second largest in the world currently by market capitalization of listed shares, at more than $4 trillion. Only the New York Stock Exchange is larger. However, its prominence has fallen significantly since early 1990's asset bubble peak, when it accounted for more than 60 percent of the entire world's stock market values.

Tokyo had 8,460 ha (20,900 acres) of agricultural land as of 2003[1], according to the Ministry of Agriculture, Forestry and Fisheries, placing it last among the nation's prefectures. The farmland is concentrated in Western Tokyo. Perishables such as vegetables, fruits, and flowers can be conveniently shipped to the markets in the eastern part of the prefecture. Japanese leaf spinach and spinach are the most important vegetables; as of 2000, Tokyo supplied 32.5% of the Japanese leaf spinach sold at its central produce market.

With 36% of its area covered by forest, Tokyo has extensive growths cryptomeria and Japanese cypress, especially in the mountainous western communities of Akiruno, Ome, Okutama, Hachioji, Hinode, and Hinohara. Decreases in the price of lumber, increases in the cost of production, and advancing old age among the forestry population have resulted in a decline in Tokyo's output. In addition, pollen, especially from cryptomeria, is a major allergen for the nearby population centers.

Tokyo Bay was once a major source of fish. Presently, most of Tokyo's fish production comes from the outer islands, such as Izu Ōshima and Hachijōjima. Skipjack tuna, nori, and aji are among the ocean products.

Demography

As one of the major cities of the world, Tokyo has over eight million people living within its 23 wards, and during the daytime, the population swells by over 2.5 million as workers and students commute from adjacent areas. This effect is even more pronounced in the three central wards of Chiyoda, Chūō, and Minato, whose collective population is less than 300,000 at night, but over two million during the day.

Transport

Tokyo is Japan's largest domestic and international hub for rail, ground, and air transportation. Public transportation within Tokyo is dominated by an extensive network of clean and efficient, if often very crowded trains and subways run by a variety of operators, with buses, monorails and trams playing a secondary role. Railway stations are not only transport, but the center of Tokyo and Japanese urban life, as everything is judged in relation to it, taking on the significance of highways in the United States and elsewhere.

Within Tokyo, Tokyo International Airport ("Haneda") offers mainly domestic flights. Outside Tokyo, Narita International Airport, in Narita, Chiba Prefecture, is the major gateway for international travelers.

Rail is the primary mode of transportation in Tokyo, which has the most extensive urban railway network in the world and an equally extensive network of surface lines. JR East operates Tokyo's largest railway network, including the Yamanote Line loop that circles the center of downtown Tokyo. Tokyo Metro and Tokyo Metropolitan Bureau of Transportation operate the subway network. The metropolitan government and private carriers operate bus routes. Local, regional, and national services are available, with major terminals at the giant railroad stations, including Tokyo and Shinjuku.

Expressways link the capital to other points in the Greater Tokyo area, the Kantō region, and the islands of Kyūshū and Shikoku.

Functional areas of Tokyo

As of September 1, 2003, the official total population of the special wards combined was about 8.34 million, with a population density of 13,416 persons per square kilometer.

The term "central Tokyo" today may refer to the special wards, the area within the Yamanote Line loop (Shinjuku, Toshima, Bunkyo, Taito, Chiyoda, Chuo, Minato, Shinagawa, and Shibuya), or to the three "central wards" of Chiyoda, Chūō and Minato. While the generally-accepted center of Tokyo is the Imperial Palace, as a rail-centric city, there are a number of major urban centers where business, shopping, and entertainment are concentrated around major train stations. These include:

Shinjuku: Location of the Tokyo Metropolitan Government Building. The area is best known for Tokyo's early skyscrapers, erected in the 1970s. Major department stores, electronics stores and hotels can also be found here. On the east side of Shinjuku Station, Kabuki-cho is notorious for its many bars and nightclubs. Shinjuku Station moves an estimated three million passengers a day, making it the busiest in the world.
Marunouchi and Otemachi: The main financial and business district of Tokyo has many headquarters of banks, trading companies and other major corporations. The area is seeing a major redevelopment with new buildings for shopping and entertainment constructed in front of Tokyo Station's Marunouchi side.
Ginza and Yurakucho: Major shopping and entertainment district with department stores, upscale shops selling brand-name goods, and movie theaters.

Activities

From the pictures found on this site describe the city

file:///c:/Documents%20and%20Settings/Professeur/Mes%20documents/Rob/ssdTehg/Japan/tokyo%20photos.htm

What are the plans for the future?

file:///c:/Documents%20and%20Settings/Professeur/Mes%20documents/Rob/ssdTehg/Japan/Tokyo%20urban%20goals.htm

See the actions proposed in part 3 of:

file:///c:/Documents%20and%20Settings/Professeur/Mes%20documents/Rob/ssdTehg/Japan/Tokyo%20megalopolis.htm

For background information on Tokyo as a global city see

http://www.japanfocus.org/products/details/1843

2006-11-13T02:03:00.000-08:00

http://en.wikipedia.org/wiki/Japanese_post-war_economic_miracle

Japanese post-war economic miracle

Japanese Post-War Economic Miracle is the name given to the historical phenomenon of Japan's record period of economic growth following World War II, spurred both by US investment and Japanese government economic interventionism in particular through their Ministry of International Trade and Industry. The distinguishing characteristics of the Japanese economy during the 'economic miracle' years included: the cooperation of manufacturers, suppliers, distributors, and banks in closely knit groups called keiretsu; the powerful enterprise unions and shuntō; close relations with government bureaucrats, and the guarantee of lifetime employment (shushin koyo) in big corporations and highly unionized blue-collar factories. Since 1993, Japanese companies have begun to abandon some of these norms in an attempt to increase profitability.

Contribution of USA

In 1946, commercial burdens from wartime expenses threatened economic ruin. Post-war inflation, unemployment and shortages in all areas seemed overwhelming. Japan’s immediate economic improvement was not achieved on its own. The American government, under the auspices of the Supreme Commander of the Allied Powers (SCAP), played a crucial role in Japan’s initial economic recovery. SCAP officials believed economic development could not only democratize Japan but also prevent the reemergence of militarism, and forfend communism in the Land of the Rising Sun. Military hostilities in the Korean peninsula further boosted the economy in 1950 because the U.S. government paid the Japanese government large sums for "special military procurement." These payments ammounted to 27% of Japan’s total export trade. The United States also insisted that Japan be admitted to GATT as a "temporary member" – over British opposition. During the Korean War, SCAP departed and full sovereignty was returned to the government of Japan.

Government contribution

The Japanese financial recovery continued even after SCAP departed and the economic boom propelled by the Korean War abated. Japan’s economy survived the deep recession caused by a loss of the U.S. payments for military procurement and continued to make gains. By the late 1960s, Japan had risen from the ashes of World War II to achieve an astoundingly rapid and complete economic recovery. According to Mikiso Hane, the period leading up to the late 1960’s saw "the greatest years of prosperity Japan had seen since the Sun Goddess shut herself up behind a stone door to protest her brother Susano-o's misbehavior." The Japanese government contributed to the post-war Japanese economic miracle by stimulating private sector growth first instituting regulations and protectionism that effectively managed economic crises and later by concentrating on trade expansion. This was done through the guidance of the Ministry of International Trade and Industry (MITI).

According to some scholars, no other governmental regulation or organization had more economic impact than MITI. “The particular speed, form, and consequences of Japanese economic growth,” Chalmers Johnson writes, “are not intelligible without reference to the contributions of MITI” (Johnson, vii). Established in 1949, MITI’s role began with the "Policy Concerning Industrial Rationalization" (1950) that coordinated efforts by industries to counteract the effects of SCAP’s deflationary regulations. In this way, MITI formalized cooperation between the Japanese government and private industry. The extent of the policy was such that if MITI wished to “double steel production, the neo-zaibatsu already has the capital, the construction assets, the makers of production machinery, and most of the other necessary factors already available in-house”. The Ministry coordinated various industries, including the emerging keiretsu, toward a specific end, usually toward the intersection of national production goals and private economic interests.

MITI also boosted the industrial sector by untying the importation of technology from the importation of other goods. MITI's Foreign Capital Law (1950) granted the ministry power to negotiate the price and conditions of technology importation. This element of technological control allowed it to promote industries it deemed promising. The low cost of imported technology allowed for rapid industrial growth. Productivity was greatly improved through new equipment, management, and standardization.

MITI gained the ability to regulate all imports with the abolition of the Economic Stabilization Board and the Foreign Exchange Control Board in August 1952. Although the Economic Stabilization Board was already dominated by MITI, the Yoshida Governments transformed it into the Economic Deliberation Agency, a mere "think tank," in effect giving MITI full control over all Japanese imports. Power over the foreign exchange budget was also given directly to MITI.

MITI's establishment of the Japan Development Bank (1951) also provided the private sector with low-cost capital for long-term growth. The Japan Development Bank introduced access to the Fiscal Investment and Loan Plan (FILP), a massive pooling of individual and national savings. At the time FILP controlled four times the savings of the world's largest commercial bank. With this financial power, FILP was able to maintain an abnormally high number of Japanese construction firms (more than twice the number of construction firms of any other nation with a similar GDP).

In 1954, the economic system MITI had cultivated from 1949 to 1953 came into full effect. Prime Minister Ikeda Hayato, who Johnson calls "the single most important individual architect of the Japanese economic miracle," pursued a policy of heavy industrialization. This policy lead to the emergence of over-loaning (a practice that continues today) in which the Bank of Japan issues loans to city banks who in turn issue loans to industrial conglomerates. Because there was a shortage of capital in Japan at the time, industrial conglomerates borrowed beyond their capacity to repay, often beyond their net worth, causing city banks in turn to overborrow from the Bank of Japan. This gave the national Bank of Japan complete control over dependent local banks.

The system of over-loaning, combined with the government's relaxation of anti-monopoly laws (a remnant of SCAP control) also led to the reemergence of conglomerate groups called keiretsu that mirrored the wartime conglomerates, or zaibatsu. Keiretsu efficiently allocated resources and became competitive internationally.

At the heart of the keiretsu conglomerates' success lay city banks, which lent generously, formalizing cross-share holdings in diverse industries. The keiretsu spurred both horizontal and vertical integration, locking out foreign companies from Japanese industries. Keiretsu had close relations with MITI and each other through the cross-placement of shares, providing protection from foreign take-overs. For example, 83% of Japan’s Development Bank’s finances went toward strategic industries: shipbuilding, electric power, coal and steel production. Keiretsu proved crucial to protectionist measure that shielded Japan’s sapling economy.

Import substitution to export orientation

The period of rapid economic growth between 1955 and 1961 paved the way for the "Golden Sixties". The second decade that is generally associated with the Japanese economic miracle. In 1965, Japan's nominal GDP was estimated at just over $91 billion. Fifteen years later, the nominal GDP had soared to a record $1,065 billion by 1980.

Under the leadership of Prime Minister Ikeda, former minister of MITI, the Japanese government undertook an ambitious "income-doubling plan." Ikeda lowered interest rates and taxes to private players to motivate spending. In addition, due to the financial flexibility afforded by the FILP, Ikeda’s government rapidly expanded government investment in Japan’s infrastructure: building highways, high-speed railways, subways, airports, port facilities, and dams. Ikeda's government also expanded government investment in the communications sector of the Japanese economy previously neglected. Each of these act continued the Japanse trend towards managed economy the epitomizes the mixed economic model.

Besides Ikeda's adherence to government intervention and regulation of the economy his government pushed trade liberalization. By the April of 1960, trade imports had been 41 percent liberalized (compared to 22 percent in 1956). Ikeda planned to liberalize trade to 80 percent within three years. His plans however met severe opposition from within Japanese society.

However, governmental plans to liberalize trade faced fierce opposition from both industries who had thrived on over-loaning and the nationalist public who feared foreign enterprise takeovers. The Japanese press likened liberalization to "the second coming of the black ships," "the defenselessness of the Japanese islands in the face of attack from huge foreign capitalist powers," and "the readying of the Japanese economy for a bloodstained battle between national capital and foreign capital." Ikeda's income-doubling plan was largely a response to this growing opposition and widespread panic over liberalization, adopted to quell public protests. Ikeda's motivations were purely pragmatic and foreign policy based however. He moved toward liberalization of trade only after securing a protected market within through internal regulations that favored Japanese products and firms.

Ikeda also set up numerous allied foreign aid distribution agencies to demonstrate of Japan’s willingness to participate in the international order and to promote exports. The creation of these agencies not only acted as a small concession to international organizations, but also dissipated some public fears about liberalization of trade. Ikeda furthered Japan’s global economic integration by joining the GATT in 1963, the IMF, and the OECD in 1964. By the time Ikeda left office, the GNP was growing at a phenomenal rate of 13.9 percent due largely to a protected economy within together with exports to unprotected markets abroad.

In 1962 Kaname Akamatsu has published his famous article introducing the Flying Geese Paradigm. It postulated that Asian nations will catch up with the West as a part of a regional hierarchy where the production of commoditized goods would continuously move from the more advanced countries to the less advanced ones. The paradigm was named this way due to Akamatsu's envisioning this pattern as geese flying in unison with Japan being an obvious leader.

Background of the Flying Geese Paradigm

The image of geese flying in unison – Genko keitai in Japanese – has been used in both Chinese and Japanese classical literature as a symbol of heroism and collective action within a nation-state. These Confucian virtues and others could be deducted from various qualities of the flight such as the geometry of the formation or the desire to return home (Terry 2002, 54). Presumable because of the powerful symbolism the flying geese have come to serve Japanese economists and others as a metaphor for several different phenomena over the past century (Ozawa 2005, 9-10). The scholar most closely associated with “the flying geese” theory is Kaname Akamatsu. He has in fact developed three distinct models named after the migrating birds:

His first flying geese pattern concerns the process of moving from import, via production for domestic consumption, to production for export(Ozawa 2005, 9).
The second theory describes industry-cycle sequencing on the basis of shifting comparative advantages (Kasahara 2004, 8).
The third theory was published in 1961's ground-breaking 'A Theory of Unbalanced Growth in the World Economy' where he describes what he calls “the alignment of nations along the different stages of development”(Ozawa 2005, 10).

These three models can be seen as distinct entities or as mutually dependent parts of a larger framework dealing with industrial development over time in developing nations, especially East Asia; the first two taking place within a nation and the third theory dealing with the larger regional issue of industrial development.

The link between the theories and the name “Flying Geese” lies in the pattern of sequential curves that appear when making a graph of – for instance – import, production for internal consumption and production for export over time.

In the 1930’s and during World War II Akamatsu worked for the Japanese army with the task of planning the post-war (or to be more precise: post-Japanese victory) economic order in Asia. This work produced a part of the foundation for the theories he put forward in the 1960’s. The Flying Geese Paradigm has therefore not only the characteristics of a descriptive model but also of a normative design (Terry 2002, 63-67). The theory, its originator and those who developed it further must be seen in the context of their relationships with the state bureaucracy and its role as a tool to help Asia achieve its unprecedented levels of sustained growth in the second half of the 20th century. The conclusions drawn from the paradigm can also be said to be important for understanding Japanese post-war policies towards its neighboring states, especially Japanese aid policy and state-directed Foreign Direct Investment (Terry 2002, 67-85).

Akamatsu’s third Flying Geese Paradigm

Akamatsu’s third Flying Geese Paradigm is a model for international division of labor in East Asia based on dynamic comparative advantage. The paradigm postulated that Asian nations will catch up with the West as a part of a regional hierarchy where the production of commoditized goods would continuously move from the more advanced countries to the less advanced ones. The underdeveloped nations in the region could be considered to be “aligned successively behind the advanced industrial nations in the order of their different stages of growth in a wild-geese-flying pattern” (Ozawa 2005, 9). The lead goose in this pattern is Japan itself, the second-tier of nations consisted of the New Industrializing Economies (South Korea, The Republic of China (Taiwan), Singapore and Hong Kong). After these two groups come the main ASEAN countries: Indonesia, Thailand and Malaysia. Finally the least developed major nations in the region: China, Vietnam etc. make up the rear guard in the formation (Kasahara 2004, 2-13).

The main driver in the model is the “leader’s imperative for internal restructuring” (Kasahara 2004, 10) due to increasing labor costs. As the comparative advantages (on a global scale) of the ‘lead goose’ causes it to shift further and further away from labor-intensive production to more capital-intensive activities it sheds its low-productivity production to nations further down in the hierarchy in a pattern that then reproduces itself between the countries in the lower tiers. The impulse for development always comes from the top tier causing many to label the FGP a top-down model (Kasahara 2004, 9-10). The FGP has proved to be a useful tool when describing the regional production patterns in East Asia as industries such as the textile industry has left not only Japan – the most advanced East Asian nation – but also, at a later point, South Korea and, Taiwan etc. These second tier nations have now firmly established themselves in for instance the automotive industry and are now beginning to shift to the even more advanced production of microcomputers and the like.

The vehicle for technology transfer is where Akamatsu’s framework is least developed. He does however suggest that the demonstration effect of international trade plays an important part as well as the “animal spirit of the entrepreneurs” in developing countries. More recently, modified versions of the FGP – such as the one presented in Ozawa (1995) – stress the importance of transnational firms in this area (Kasahara 2004, 12).

Regarding the internal order of nations within the model, Akamatsu did not consider the relative positions to be permanently fixed but could rather be seen as inherently unstable. This idea is most likely connected to the memories of the Japanese development in the late 19th century when it catapulted itself from a technological backwater to a mature industrial powerhouse. Other scholars however, have emphasized the stability and harmony of the clustered growth envisaged in the FGP implying it would be for a nation difficult to shift from one tier to another (Kasahara 2004, 12-13).

Activites:

a) Which major problems did Japan face at the end of WWII.

b) Identify three major actors in the post-war Japanese recovery.

c) Identify potential difficulties in the keiretsu system.

d) Draw a graph to show Japan's increase in GDP, level of economic growth marking onto it key stages in the country's economic development.

e) Create a diagram to summarise the 3^rd Flying Geese Paradigm indicating the relationship between Japan, the rest of South-east and Eastern Asia.

2006-10-25T02:42:00.000-07:00

Demography, Migration and Urbanisation in China.

Theories

Zelinsky's Mobility Transition (1971)

Intensity of different types of migration is related to stages of socio-economic development from the pre-industrial traditional society to a future super-advanced society. In his hypothesis 'circulation' covers a variety of movement (eg seasonal, journeys to work, holidays) not included under the generals term of migration.

Phase I: very little residential migration and very limited circulation occasioned by social visits, the local economy, war and religion.

Phase II: considerable rural to urban migration alongside mass migration to new lands.

Phase III: rural to urban migration as well as emigration are reduced but still remain important.

Phase IV: new forms of movement (movement between cities and within cities) become important.

Net immigration of semi or unskilled workers migrants from undeveloped areas. Accelerated circulation particularly economic and pleasure seeking.

Phase V Future super advanced society (corresponds to stage V in demographic transition model)

Similar to phase IV yet level of movement may be reduced. New forms created such as urban to rural.

Ravenstein's Laws of Migration (1876, 1885, 1889) based his theories on data for Britain. Founder of migration theories. Echoes C18th political economists led by Adam Smith. His laws state:

a) Most migrants move only a short distance. As distance from a particular place increases the number of migrants decreases.

b) Migration occurs in a series of waves.

c) Each significant stream (flow) produces a counterstream.

d) The longer the distance travelled the greater the likelihood of the destination being a major industrial and commercial centre.

e) Migrants are generally adults.

f) Females are more migratory over shorter distances while males are more likely to move long distances, particularly to other countries.

g) The volume increases with development of industry and commerce.

h) Major causes of migration are economic.

The direction is mainly from agricultural to industrial.

Lee's Principles of Migration

Origin-intervening obstacles-destination model which emphasises push-pull factors. Used to formulate hypotheses about the volume, the development of stream and counterstream and the characteristics of migrants eg migration tends to take place in well defined streams.

To what extent do the migration patterns in China support the migration theories above?

Migration in China

2001 Pop: 1.276 billion. Rural pop was 62.34% of total and rural labour force was 67.22% of total of which 67% (329 million) worked in agriculture. Since 1978 reforms of the economy creating a 'socialist market economy' have lead to an improvement in general standard of living and a reduction in the number of people living below the poverty line (280 million (only 100 RMB) in 1980 to 32 million (625 RMB) in 2000.

Creation of Special Economic Zones in East (received 88% of FDI from 1990-96) as well as preferential development of cities (urban population grew from 20.60% of pop in 1980 to 40% in 2002) has increased the income inequality between the east and the rest of the country and rural and urban areas. Only since 1990 has a 'go-west policy' been initiated.

Number of rural-urban migrants have grown from 2 million in mid-1980s to 94 million in 2002.

There were 88 million rural migrants in 2001 55% came from central region and 34% from west. Of these 88million nearly 90% went to rural areas, with 82% moving east. Most of those moving east went to townships and county towns only 30% went to provisional cities or large metropolitan areas.

Average level of education of migrants is higher than those who stay (junior high school).

One third of rural migrants are women however Taiwanese; Hong Kong or overseas Chinese processing plants located in the south prefer females to males. Average age of female migrants (17-25) is lower than that of male(16-30).

Up until 2001 migrants often did not have official status at their destination due to Hukou policy. This has now been reformed but there still remain problems. In 2003 there were an estimated 140 million floating workers (not permanently registered)

Majority of migrants are Han Chinese.

Consequences:

Relieve the pressure on the land

Return of revenue

Development of skills

Yangtzi River Delta received 37.2% of migrant workers in 2000 of these 14% in construction; 12% in services and 11% in restaurant work.

Migrant workers contributed 16% of total GDP growth in past 18 years (from 2005) due to their hard work, high saving and low consumption.

Rural workers represent :

80% of construction workers

53% of miners

68% electronic product manufacturing

58% restaurants

58% sales

52% social services

A survey published in 2005 found that most rural migrant labourers return home.

International migrants

Number has risen although in 2001 there were around 3 million (represents a 25% increase over 2000) of whom about ½ million migrated to find employment. This does not included illegal migration which could be around 400.000.

In 2004 it was estimated that there were some 33 million ethnic Chinese living outside China, Taiwan, and Hong Kong. Large though this figure might appear, it is small compared with the total population of China itself, representing only 2.5 percent of a figure that presently exceeds 1.3 billion.

The three southern coastal provinces of Guangdong, Fujian, and Zhejiang have dominated the emigration, and within those provinces, a limited number of districts and even villages.

Migration of Chinese from China has, nevertheless, been significant. It is a growing phenomenon, one that is often included under the rubric "the Chinese diaspora."

Two factors account for the shift in the migration patterns of the Chinese peoples. First, there were changes in the immigration policies of the potential destination countries that finally swept away the legacy of racist policies based on regions of origin. Second, the Chinese became increasingly capable of taking advantage of opportunities overseas.

The Chinese continue to be in the forefront of new immigration to North America and Australasia. Hong Kong pioneered these new Chinese migrations but China, by the turn of the new century, had become a major source of migrants. In the case of Canada, China became the principal source of landed immigrants from 1998.

Large numbers go abroad temporarily as students or skilled workers. Students from China make up the most important group of foreign students in Canada and the second most important group in the United States in the early 21st century.

Some 17,000 skilled workers from China entered the United States in 2002-2003 under the H-1B visa program, almost half of them going into computer-related occupations. In total, 861,930 Chinese citizens entered the United States as some type of temporary entrant in 2001, still a long way behind the leading Asian source, Japan, at over five million. This category includes tourists.

By 2000, the Chinese population as a whole in the United States, at 2.7 million, had emerged as the largest Asian ethnic group and one that was increasing at a rate between four and five times faster than the growth rate of the total population of the country.

The Chinese represent a minority group among those smuggled into both the United States and Europe. The term "smuggled" is used in preference to "trafficked," as the majority of Chinese appear to enter willingly into illegal arrangements in order to facilitate their passage to the West, paying up to $50,000 or more for the privilege, depending upon the destination and means of transfer. Most, though not all, of the irregular migrants come from Fujian Province. This province, paradoxically, is one of China's richer areas.

Some evidence exists to suggest that the locus of the smuggling of the Chinese is shifting from North America towards Europe, and also Japan, which may reflect the success of increased surveillance around the United States, particularly after September 11.

2006-10-25T02:23:00.000-07:00

s Shanghai a global city?

Articles:

Can Shanghai compete as a global city? 2002 http://chreod.com/publications/20052222_40527Shanghai%20_CBR_Sept%20Oct02.pdf

Saskia Sassen (2006) http://www.japanfocus.org/products/details/1843

Is Shanghai really a Global City? Lin Ye(2003) http://www.uic.edu/cuppa/cityfutures/papers/webpapers/cityfuturespapers/session5_6/5_6shanghai.pdf

Definition:

World cities (Friedmann1986: establishes the world-city model as the main thesis to link urbanisation to global economic forces which explains the spatial organisation of the New international division of labour.

“Mega-cities” Castells 200 represent a new spatial form of the world economy where dominant centrers of population act as magnets for their hinterlands and are a gravitational power towards major regions of the world.

Global cities Sassen 2000 are defined as strategic sites for the management of the global economy and the production of the most advanced services and financial operations. Global cities have advanced technology, infrastructure and human resources that are vital to attract global capital. Sassen (2000) defines producer services as 'services for firms' including “financial, legal,and general management matters; innovation; development; design; administration; personal; production technology; maintenances; transport; communications; wholesale distribution; advertising; cleaning services for firms; security and storage”. Requirement of specialized agglomeration economies, advanced technology infrastuctures and high innovative environments.

“Primate cities (Savitch 1996) are described as cities that not only hold financial houses and corporate headquarters but also are balanced by textile manufacture, light industry, chemical production and warehousing. These are giant entities whose agglomerations are at least twice as large as the next largest city in the nation.

A global city and world city, or world-class city, is a concept introduced by a group of academics including the Globalization and World Cities Study Group and Network (GaWC), based primarily at Loughborough University. The concept includes the postulation that some cities have a direct and tangible effect on global affairs through socioeconomic, cultural, and/or political means, whilst others do not. This leads to the need to develop rules to categorise cities as global or non-global, and to sub-categorise global cities in various ways.

In recent years, the term has become increasingly familiar, because of the rise of globalization (i.e., global finance, communications, and travel). The term "global city", as opposed to megacity, was first coined by Saskia Sassen in a seminal 1991 work.

http://en.wikipedia.org/wiki/Global_city

http://www.lboro.ac.uk/gawc/citymap.html

GaWC Inventory of World Cities (1999 Edition)

An attempt to define and categorise world cities was made in 1999 by the Globalization and World Cities Study Group and Network (GaWC), based primarily at Loughborough University in Loughborough, Leicestershire, England. The roster was outlined in the GaWC Research Bulletin 5[2] and ranked cities based on provision of "advanced producer services" such as accountancy, advertising, finance and law, by international corporations. The GaWC inventory identifies three levels of world cities and several sub-ranks.

Note that this roster generally denotes cities in which there are offices of certain multinational companies providing financial and consulting services rather than other cultural, political, and economic centres. There is a schematic map of GaWC cities at their website.[3]

General characteristics

It has been argued that global cities are those sharing the following characteristics:

International, first-name familiarity; whereby a city is recognised without the need for a political subdivision. For example. although there are numerous cities and other political entities with the name Paris or variations on it, one would say "Paris", not "Paris, France".
Active influence and participation in international events and world affairs; for example, New York City is home to the United Nations headquarters complex and consequently contains a vast majority of the permanent missions to the UN[1].
A fairly large population (the centre of a metropolitan area with a population of at least one million, typically several million).
A major international airport (for example, London Heathrow Airport) that serves as an established hub for several international airlines.
An advanced transportation system that includes several freeways and/or a large mass transit network offering multiple modes of transportation (rapid transit, light rail, regional rail, ferry, or bus).
In the West, several international cultures and communities (such as a Chinatown, a Little Italy, or other immigrant communities). In other parts of the world, cities which attract large foreign businesses and related expatriate communities; for example, Singapore, Shanghai, Hong Kong, Tokyo, and Moscow.
International financial institutions, law firms, corporate headquarters (especially conglomerates), and stock exchanges (for example the London Stock Exchange, the New York Stock Exchange or the Tokyo Stock Exchange) that have influence over the world economy.
An advanced communications infrastructure on which modern trans-national corporations rely, such as fiberoptics, Wi-Fi networks, cellular phone services, and other high-speed lines of communications.
World-renowned cultural institutions, such as museums and universities.
A lively cultural scene, including film festivals (for example the Toronto International Film Festival), premieres, a thriving music or theatre scene (for example, West End theatre and Broadway); an orchestra, an opera company, art galleries, and street performers.
Several powerful and influential media outlets with an international reach, such as the BBC, Associated Press, Reuters, The New York Times, The Times, or Agence France-Presse.
A strong sporting community, including major sports facilities, home teams in major league sports, and the ability and historical experience to host international sporting events such as the Olympic Games, Football World Cup, or Grand Slam tennis events.

To some, London, New York City, Paris, and Tokyo have been traditionally considered the 'big four' world cities – not coincidentally, they also serve as symbols of global capitalism. However, many people have their own personal lists, and any two lists are likely to differ based on cultural background, values, and experience.

In certain countries, the rise of suburbia and the ongoing migration of manufacturing jobs to these countries has led to significant urban decay. Therefore, to boost urban regeneration, tourism, and revenue, the goal of building a "world-class" city has recently become an obsession with the governments of some mid-size cities and their constituents.

Information

In 2002 Shanghai won the bid to host the 2010 World exposition.

In 2007 Shanghai will host the 2007 Summer Olympics.

With a population of over 16 million (of which 3.8 million are migrants who have resided more than 6 months) Shanghai is the biggest city in China and the second-largest metropolis in East Asia after Tokyo.

The real market area of Shanghai extends beyond its administrative boundary. Within one-day drive is a regional market of more than 100 million people making it the largest in East Asia (twice that of Tokyo).

Part of an industrializing and urbanizing corridor from Ningbo to Shanghai through Suzhou to Nanjing 250 km long but less than 50 km wide which constitutes China's largest megalopolis.

By 2015 when the National Trunk Highway System is complete shanghai will have access to a coastal and central China market of just over 600 million consumers within a two-day drive by truck. This region will by then contribute 60 % of China's GDP and home 80% of its enterprises.

Shanghai is the only Chinese city to have two international airports (Pudong and Hongqiao). In 2002 the accumulative cargo of the two airports were ranked top 20 in the world, with top 35 passenger volume and top 75 movements between the world largest airports.

In 2002 Shanghai, China's largest port, was ranked 23^rd in the world in terms of port calls; 4^th in total tonnage and 5^th in container traffic.

Shanghai is an ocean port for the Yanqzi River Basin stretching to Yunnan. With the completion of the Three Gorges Dam 10.000-ton ships will be able to reach inland as far as Chongqing.

By 2015 Shanghai will have constructed a new deepwater container port on Yangshan island with 50 berths (Hong Kong the world's largest container port has 18 berths). It will be connected to mainland by a 30km 8-lane bridge.

In 2001 the employment in the tertiary sector of Shanghai was 45.6% of the total (160% higher than the national average). Tertiary services accounted for 32% of city's GDP in 2000.

In 2003 there were 3.500 financial institutions in Shanghai, including over 50 venture capital firms. It has 46% of the oversea's law firms in China. It has 27 global firm offices and is therefore ranked 45^th of the 55 global cities.

In 2003 there were 45 colleges and universities and 34 research academies. It has formal academic exchanges with more than 400 universities in 30 countries.

In 2000 11.4% of the city's population had a college-equivalent education.

Shanghai public officials have become national political leaders.

Many large and old industrial plants have relocated to outlying cites and towns in the Yangzi delta. Freeing up inner city land for residential and commercial redevelopment.

Medium value added industrialization has transformed suburban towns into important extensions of the city within the Outer Ring Road leading to the evolution of a poly-nucleated structure similar to Tokyo and New York.

High value-added manufacturing shows signs of economic and spatial clustering. Micro-electronics are concentrated in Zhangjiang High-Tech Park in Pudong New Area; Automotive firms are clustered in Anting area. Large scale chemical production are centered in Shihua Town on Hangzhou Bay.

By 2010 30% of city's GDP could be in quaternary services and 28% in tertiary. The contribution of high value-added manufacturing could be 20%, that of low value-added may disappear.

2006-10-25T02:17:00.000-07:00

http://www.policyreview.org/feb04/eberstadt.html
(Original Version)

Power and Population in Asia

By Nicholas Eberstadt
Nicholas Eberstadt holds the Henry Wendt chair in political economy at the American Enterprise Institute. This essay is adapted from a study by the author in Strategic Asia, 2003–2004 (National Bureau of Asian Research).

Population explosion: Yesterday’s news

The asian/eurasian territory encompasses an extraordinary crush of humanity. Although the population patterns of the countries in question (we are deliberately excluding the Arabian peninsula and most of the “Asian” Middle East from consideration here) vary markedly, the absolute numbers under discussion are vast: As of mid-2000, over 3.6 billion, roughly three-fifths of the total population of the globe, resided in Asia. Seven of the world’s 10 most populous countries — China, India, Indonesia, Russia, Pakistan, Bangladesh, and Japan — are located within the Asian/Eurasian perimeter.

Over the past half-century, the population of this region has grown on a scale and at a tempo without historical precedent. Between 1950 and 2000, according to the unpd’s estimates, the population of the collectivity of countries in Table 1 (see next page) multiplied by a factor of 2.5 — rising by almost 2.2 billion in absolute numbers and at an average annual pace of over 1.8 percent per year. Perhaps not surprisingly, this extraordinary Asian “population explosion” captured the attention and aroused the foreboding of commentators, scholars, and policymakers around the world. (A small library of literature was generated over the course of two generations on the purported economic, political, and strategic implications of this vast population shift.) The vision of unrelenting and unprecedented increases in human numbers in Asia continues to inform much popular and policy discussion — thanks in no small part to official alarms regularly sounded by institutions and programs established over the past few decades with the express purpose of slowing population growth.

But that vision is by now outdated and increasingly misleading. The great twentieth-century demographic boom is essentially over in East Asia. It is winding down rapidly in Southeast Asia, and even in South Asia the situation has changed greatly. (Russia, for its part, has been recording negative natural increase — more deaths than births — every year over the past decade.)

The Asian “population explosion” was actually a “health explosion” — it was fueled almost entirely by declining mortality due to dramatic improvements in life expectancy. That same “population explosion” has been defused by ongoing changes in childbearing patterns. Over the past three decades, Asia and Eurasia have witnessed pervasive and typically dramatic declines in local fertility levels. Since the early 1970s, the total fertility rate (or tfr — the synthetic measure of births per woman per lifetime under existing childbearing patterns) is believed to have dropped about three-fifths in East Asia and by over half in Southeast Asia; even in South Asia fertility rates are thought to have dropped by two-fifths. Thanks to these declines, sub-replacement fertility (i.e., a pattern of childbearing which, in the absence of migration, would eventually lead to a stabilization of total population and thereafter to an indefinite decrease) is increasingly emerging as the norm in Asia and Eurasia.

At this juncture, for example, sub-replacement fertility is thought to characterize every country and locale in East Asia save tiny Mongolia. In Southeast Asia, Singapore and Thailand are already sub-replacement societies, and Indonesia appears to be rapidly closing in on the replacement fertility level. As for South and Central Asia, Sri Lanka and Kazakhstan are outposts of sub-replacement fertility within the region. Elsewhere in that area, fertility change has been more pronounced than is often appreciated. With an estimated tfr of 3.0, for example, India’s overall fertility level is still thought to be well above replacement — but it has also plunged by an estimated 45 percent nationwide since the 1950s, and major urban centers like Mumbai (Bombay), New Delhi, and Kolkata (Calcutta) are all believed to be sub-replacement now, as are some entire Indian states (e.g., Kerala, Tamil Nadu).²

Indeed, the rapid pace of fertility decline in some Asian countries seems already to have overtaken some of the unpd’s most recent fertility projections: The latest information from such disparate locales as Iran and Vietnam suggest that both may currently be at replacement-level fertility — or even below.³ Only in uncharted Afghanistan are fertility rates guessed to be stubbornly stuck at essentially premodern elevations.

As a consequence of a generation and more of sweeping — and still continuing — fertility decline in Asia and Eurasia, it is no longer accurate to speak of “unprecedented population growth” either for the region as a whole or for its major components. For the collectivity of countries in Table 1, the current pace of population growth (a projected 1.1 percent per year) is actually distinctly lower than half a century ago (when it is thought to have exceeded 1.8 percent per annum). Even in such places as Bangladesh, the perennial poster child for the “population explosion,” demographic growth, though still rapid (about 2 percent per year), is notably slower than in recent decades — and perhaps ever so slightly slower today than in the early 1950s.

Absolute growth of the region’s population also looks to have peaked. For Asia/Eurasia as a whole, the annual increment in population today is estimated at about 43 million persons a year — distinctly less than the estimated 52 million a year of the late 1980s, and indeed lower than the 46 million a year in the late 1960s. According to the unpd’s latest medium variant projections, the absolute annual increase of population peaked in East Asia in the late 1960s and in Southeast Asia in the early 1990s, and, while there is less certainty on this final point, the projections also suggest that absolute population increments in South and Central Asia may be slightly lower today than they were in the early 1990s.

Is there strategic significance to this fertility decline and the population changes it is relentlessly, but unevenly, causing throughout Asia? Arguably so — but probably not in the ways we are most accustomed to hearing about.⁴ To get at the actual strategic constraints and opportunities presented by patterns of population change in Asia and Eurasia, we will have to look carefully into specific details.

Do shifts in relative size matter?

If we consider the two-generation sweep from 1975 to 2025 — in which we are currently more or less at midpoint — we will observe that relative population weight is poised to shift appreciably for various dyads — including several pairings of neighboring, and potentially rivalrous, states:

India/China. By the unpd’s medium variant projections, between 1975 and 2025, China’s population will grow by about half, from approximately 930 million to over 1.4 billion. India’s, on the other hand, will more than double, jumping from around 620 million to over 1.3 billion. A generation ago, there were nearly 50 percent more people in China than in India; a generation hence, the projected differential will be a mere 5 percent.

Japan/Korea. In 1975, the population of the Republic of Korea amounted to less than a third of Japan’s (35 million vs. 111 million). In 2025, under medium variant projections, the rok’s population will be over two-fifths of Japan’s (50 million vs. 123 million). If we imagine a Korean unification under Seoul’s leadership sometime before 2025, the population balance would shift all the more sharply, with the united peninsular rok population equaling three-fifths of Japan’s own (75 million vs. 123 million).

Pakistan/Russia. The most radical and dramatic shift in the relative population weight between major countries in the region, however, involves Pakistan and Russia. In 1975, Russia’s population was nearly twice as large as Pakistan’s (134 million vs. 70 million). By 2025, under medium variant projections, the situation will be virtually reversed: Pakistan will be just over twice as populous as Russia (250 million vs. 124 million).⁵

Aging Asia: An uneven burden

One immediate and obvious example of an internal demographic change fraught with possible economic and political significance is the wave of population aging that is sweeping the Asian/Eurasian region. The current and impending “graying” of Asia and Eurasia is an all but irrevocable force, since it is propelled by the basic arithmetic of longer lives and smaller families — trends, we will recall, that have already been developing in the region for decades if not generations. Only a catastrophe of biblical proportions could forestall the tendency for Asia’s populations to age substantially between now and 2025.

Age patterns in Asia/Eurasia vary enormously today. In such places as Afghanistan, Pakistan, Laos, and Cambodia, the “median person” as of the year 2000 was a teenager: Over half the population in those countries was probably under 20 years of age. By contrast, Japan’s median age in 2000 was over 41 years. By that particular criterion, in fact, Japan is now probably the “grayest” country on earth. Similarly, in 2000 the proportion of total population 65 years of age and older ranged from under 3 percent in Afghanistan to over 17 percent in Japan. Over the coming generation, however, every single population center in Asia/Eurasia is anticipated to age appreciably — some of them at a pace or to an extreme never before witnessed in any ordinary human society.

Although all of Asia/Eurasia is set to age markedly over the 2000-2025 period, most of the region will nonetheless remain relatively youthful. In South and Central Asia, for example, median age is poised to rise by well over six years during this quarter-century (actually a somewhat greater absolute increase than envisioned for the world’s “more developed regions” between 2000 and 2025). But even the most “elderly” country in this Asian grouping (Sri Lanka in 2025) is projected to have a somewhat younger profile than did Europe in the year 2000, and in 2025 South and Central Asia together will have a population younger than the Europe of 1950. So, too, in Southeast Asia, where despite a prospective increase in median age from roughly 24 to about 32 between 2000 and 2025, only two countries (Thailand and Singapore) will be as “gray” in 2025 as America today — and the area as a whole will still be younger than the Europe of 1975.

The part of Asia/Eurasia that stands to age most rapidly, and most profoundly, is Eastern Asia — and here we enter uncharted territory. Between 2000 and 2025, East Asia’s median age is projected to jump by nine years, to just under 40. By that metric, East Asia in 2025 will be “grayer” than Europe today, where median age in 2000 was under 38. Throughout East Asia, many populations will be more elderly than any yet known, and some will be aging at velocities not yet recorded in national populations. Between 2000 and 2025, for example, the roc (Taiwan) is set to experience a leap in median age of almost 11 years, to just under 43.⁶ South Korea’s median age, in these projections, would soar by almost 12 and a half years, to over 44. Absent an unexpected influx of young immigrants, Hong Kong’s projected median age in 2025 will be 46 — and one in five residents will be 65 or older.

But the most extreme and extraordinary instance of population aging will be witnessed in Japan. By 2025, in unpd medium variant calculations, Japan will have a median age of just over 50. Less than a quarter-century hence, by those same projections, almost 30 percent of Japan’s populace will be 65 or older, and almost every ninth Japanese will be 80 or older. This future Japan would have very nearly as many octogenarians, nonagenarians, and centenarians as children under 15 — and would have barely two persons of traditional “working age” (as the 15–64 cohort is often, not unreasonably, construed) for every person of notional “retirement age” (65 and over).

Some of the implications of such extreme and rapid population aging have already been widely discussed and analyzed. To begin, there are the fiscal implications of Japan’s version of “graying”: Under current rules of the budgetary game, these look unambiguously bleak. A 1996 study by oecd researchers, for example, estimated the net present value of the unfunded liabilities in the Japanese national pension system at 70 percent of 1994 gdp. Unless radical changes in that pay-as-you-go system were implemented, they warned, Japan’s annual deficit would approach 7 percent of gdp by 2025, and the total “pure aging effect” on public finances for 2000 to 2030 could be a debt equal to 190 percent of 2000 gdp.⁷

Given the fact that gross public debt in Japan rose from about 60 percent of gdp to nearly 150 percent of gdp from 1992 to 2002⁸ — in a context of relatively limited population aging — those numbers may sound ominous indeed. And other analysts have offered still darker assessments, with some prophesying that an extended “aging recession” would visit Japan and perhaps never depart.⁹

Without denying the seriousness of the challenges that aging will pose to Japan’s society and economy over the decades ahead, it is still possible to suggest that the economic dangers inherent in population aging for Japan (and, by extension, East Asia’s smaller prosperous, but graying, tigers) may be exaggerated in some of the contemporary commentary.

Today’s writing on the negative effects of population aging in Japan focuses (sometimes to near exclusion of all other factors) on public finances and quite rightly points out the actuarially unviable state of the country’s national pension system and the looming liabilities for its public health care sector. There is no concrete commandment, though, that a country must leave parlous budgetary imbalances uncorrected. Painful though such exertions would surely be, it is entirely within the purview of the Japanese policymakers and voters to set the country’s pension and health systems on a financially secure course. (Sure enough, oecd calculations suggest that a number of relatively obvious changes could significantly improve the financial health of the national Japanese pension system.)

The budgetary balance, moreover, is only a single component of overall macroeconomics — and the implications of population aging for Japan’s consumption, production, savings, investment, and international finance and trade performance are by no means unremittingly negative. The great social and structural shifts occasioned by population aging, recall, will create new economic opportunities in addition to all the new challenges. If gradual economic adjustments are made, if flexibility in factor markets can be achieved, and if relatively productive economic policies could be embraced and maintained, the drag imposed on Japanese economic growth by massive and rapid population aging in the decades immediately ahead need not be major. On balance it would probably remain a negative factor, but not necessarily a critical or even a major one.

The key point here is that Japan’s aging process has been stimulated materially by the country’s great health revolution. And, thanks to this ongoing revolution, the Japanese are today the world’s longest-lived people. It is counterintuitive, to say the least, to expect a health explosion to lead inexorably to national bankruptcy and economic ruin. Given Japan’s patterns of “healthy aging” and the reduced physical rigors of employment in an affluent information-age economy, Japan’s older cohorts can now realistically look forward to the real possibility of productive contribution to economic life at ever-later ages. Thus, while the population stagnation and decline that will almost surely attend Japan’s particular aging process stand to reduce the overall pace of aggregate economic growth, aging need not thwart the continuing improvement of per capita income — and augmentation of economic capacities — for Japan.

This qualified, perhaps cautiously optimistic, evaluation of the economic implications of rapid and pervasive population aging in Japan (and the smaller East Asian tigers) does not extend to the Chinese mainland. The People’s Republic of China will also undergo dramatic aging in the decades immediately ahead, but there are reasons to expect the impact of the process to be more generally adverse both socially and economically.

Between 2000 and 2025 China’s median age is set to rise very substantially: from about 30 to around 39. According to unpd projections for 2025, in fact, China’s median age will be higher than America’s. The impending tempo of population aging in China is very nearly as rapid as anything history has yet seen. It will be far faster than what was recorded in the more developed regions over the past three decades and is exceeded only by Japan. There is a crucial difference, however, between Japan’s recent past and China’s prospective future. To put the matter bluntly, Japan became rich before it became old; China will do things the other way around. When Japan had the same proportion of population 65 and older as does China today (2000), its level of per capita output was three times higher than China’s is now. In 2025, 13.4 percent of China’s population is projected to be 65-plus; when Japan crossed the 13.4 percent threshold, its per capita gdp was approaching $20,000 a year (constant 1990 ppp dollars). One need not be a “Sino-pessimist” to suggest that China will be nowhere near that same economic marker 22 years from now.

Although China’s population will hardly be as elderly as Japan’s by 2025, its impending aging process promises to generate problems of a sort that Japan does not have to face. The first relates to its national pension system: Japan’s may be financially vulnerable, but China’s is nonexistent. Government or enterprise-based retirement programs cover only about one-sixth of the contemporary Chinese work force — and nearly all of the pieces in this haphazard patchwork are amazingly unsound in actuarial terms.¹⁰ Although Chinese leadership has been committed since 1997 to establishing a sturdy and universal social security system, actions to date have lagged far behind words and the system remains only in the planning stage.

For most aging Chinese today, the pension system is the family, and even with continuing national economic progress, Chinese families are likely to be placed under mounting pressure by the swelling ranks of seniors. By 2025, there will be nearly 300 million members of China’s 60-plus population, but, at the same time, the cohorts rising into that pool will be the same people who accounted for China’s sub-replacement fertility patterns in the early 1990s and thereafter. Absent a functioning nationwide pension program, unforgiving arithmetic suggests there may be something approaching a one-to-one ratio emerging between elderly parents and the children obliged to support them. Even worse, from the perspective of a Confucian culture, a sizable fraction — perhaps nearly one-fourth — of these older Chinese will have no living son on whom to rely for sustenance. One need not be a novelist to imagine the intense social tensions such conditions could engender (to say nothing of the personal and humanitarian tragedies).

Second, and no less important, there is no particular reason to expect that older people in China will be able to make the same sort of contributions to economic life as their counterparts in Japan. In low-income economies, the daily demands of ordinary work are more arduous than in rich countries: The employment structure is weighted toward categories more likely to require intense manual labor, and even ostensibly non-manual positions may require considerable physical stamina. According to official Chinese statistics, nearly half of the country’s current labor force toils in the fields, and another fifth is employed in mining and quarrying, manufacturing, construction, or transport — occupations generally not favoring the frail. Even with continuing structural transformations, regular work in 2025 is sure to be much more strenuous in China than in Japan. Moreover, China’s older population may not be as hardy as peers from affluent societies — people likely to have been better fed, housed, and doctored than China’s elderly throughout the course of their lives.

Data on the health status of older people in China and other countries tend to be spotty and problematic, and comparability of method can never be taken for granted. However, some of the survey data that are available through Réseau sur l’Espérance de Vie en Santé (reves), the international network of “health expectancy” researchers, are thought-provoking. According to a 1989–90 “health expectancy” study for Sichuan province, a person 60 years of age would spend less than half (48 percent) of his or her remaining years in passable health. By contrast, a study in West Germany for 1986 calculated that a 60-year-old woman could expect to spend 70 percent of her remaining time in “good health.” For men the fraction was 75 percent.¹¹ Although one probably should not push those findings too far, they are certainly consistent with the proposition that China’s seniors are more brittle than older populations from more comfortable and prosperous locales.

Thus, China’s rapidly graying population appears to face a triple bind. Without a broad-coverage national pension system, and with only limited filial resources to fall back on, paid work will of necessity loom large as an option for economic security for many older Chinese. But employment in China, today and tomorrow, will be more physically punishing than in oecd countries, and China’s older cohorts are simply less likely to be up to the task. The aggregation of hundreds of millions of individual experiences with this triple bind over the coming generation will be a set of economic, social, and political constraints on Chinese development — and power augmentation — that have not as yet been fully appreciated in Beijing, much less overseas.

Unfavorable mortality trends

The positive and normative implications of a change in a society’s fertility level cannot be described unambiguously in advance. Not so for changes in mortality levels: In any setting or context, people will prefer longer lives to shorter ones. In addition to the incalculable personal benefits of life itself, rising life expectancy and the improvements in health that typically accompany it materially affect economic potential by increasing the capability of populations to work and learn, extending the period of economically active life, and tilting the calculus of education and training toward increased investment in “human capital.”

As already noted, the Asia Pacific region has enjoyed a sweeping and completely unprecedented improvement in survival chances over the past half-century. Between the early 1950s and now, life expectancy at birth is estimated to have leapt by about 25 years in both South-Central and Southeast Asia, and to have soared by nearly 30 years in East Asia. Moreover, infant mortality rates in those territories may have fallen by as much as two-thirds, three-fourths, and four-fifths, respectively. That improvement was neither entirely universal nor uninterrupted. In locales across the Asian/Eurasian expanse, it was episodically halted or temporarily reversed by terrible spikes of mortality. On the whole, however, these spasms of death were due to man-made (or, more accurately, state-made) disasters — the Great Leap Forward, the Khmer Rouge apocalypse, and the like — and they ceased when the afflicting interventions abated. Given the surge of health that coursed over postwar Asia, the general expectation not unreasonably prevailed that steady improvements in health and mortality were now the natural order of things for humanity and could be subverted only by purposeful, malign political agency.

At the dawn of the twenty-first century, that happy expectation no longer squares with basic facts about mortality in the Asian/Eurasian region. By the estimates of the U.S. Census Bureau, for example, all five former Soviet Central Asian republics began the year 2000 with distinctly lower life expectancies than they had enjoyed in 1990 — all this in peacetime and in the absence of any obvious political catastrophe. Other, arguably more politically consequential, mortality setbacks have also struck the Eurasian stage — and still more are poised to unfold.

The most conspicuous — indeed, startling — health and mortality setback in contemporary Eurasia is, of course, the one currently underway in the Russian Federation. Modern Russia has given the lie to the ameliorative presumption that literate, industrialized societies cannot suffer long-term health declines during times of peace. According to Moscow’s official calculations, the country’s life expectancy was lower in 2001 than it had been in 1961-62, four decades earlier. For Russia’s men, life expectancy had dropped by almost five years over that interim — but female life expectancy was also slightly down over that period. This anomalous circumstance could not be entirely attributed to the deformities of communist rule, for both male and female life expectancy were lower in 2001 than in 1991, the last year of Soviet power.

In absolute arithmetic terms, this Russian mortality crisis qualifies as a catastrophe of historic proportions. Over the extended period between 1965 and 2001, age-standardized mortality for Russia’s men rose by over 40 percent. Perhaps even more surprising, it also increased for Russia’s women by over 15 percent. Against the hardly exemplary health patterns of Gorbachev-era Soviet socialism, Russia has suffered a surfeit of “excess male mortality” since 1991 on the order of 3.5 million deaths — the equivalent, for Russia, of twice the deaths suffered in World War i. (Add “excess female mortality” and the post-1991 death toll rises by almost another million.)

Russia’s mortality crisis is concentrated on the population traditionally construed as “of working age.” For Russian men in every age grouping within the 20–64 spectrum, age-specific death rates in 2001 were at least 40 percent higher than they had been three decades before. In some cases (viz., men 45–54), they were over 60 percent higher. As for women between the ages of 20 and 59, their death rates were at least 30 percent higher in 2001 than in 1970-71. Russia’s cause-of-death statistics are far from perfect, but if overall reports can be trusted, the proximate explanations for these dismal trends were an explosion of deaths from cardiovascular disease (cvd) and injuries.

Reversing Russia’s long-term deterioration in public health will be a more difficult task than might at first be supposed. Throughout low-income Asia after World War ii, significant health advances were achieved through new, inexpensive, and relatively easy interventions to control infectious disease (e.g., sulfa drugs, ddt). Russia’s burden of illness today, however, is not primarily communicable and infectious, but instead overwhelmingly chronic and/or behavioral — the sorts of problems that are seldom susceptible to quick, cheap medical fixes. Moreover, death from such chronic illnesses as cvd tends to be due to an accumulation of offenses against the physiological system over the course of decades — and, to judge by mortality statistics, today’s Russian adults have been more assiduous than their parents in accumulating those offenses. Indeed, in 2001 Russian men in their late 20s had higher death rates than did men in their early 30s three decades earlier; men in their late 30s suffered nearly the same mortality rates as men in their late 40s from that earlier generation; and so on. At any given age, in other words, today’s Russians are more likely to succumb to fatal risk than their parents.

For broad segments of the current Russian population, simply returning to the health patterns of the early 1970s would be a formidable public health challenge. If Russian men in their early 40s were to reattain, by their late 40s, the same survival chances their fathers faced at that age, they would have to improve on the mortality rates of today’s 45–49 year olds by over 40 percent — and they would have to reduce their own future mortality rates to just five-sixths the level they currently experience. From today’s vantage point, that is a pretty imposing task. Success in that quest, moreover, should be evaluated in context: Male life expectancy in the Russian Federation in the early 1970s, after all, was just over 63 years — about the same as in India today.

According to unpd estimates, male life expectancy is lower today for the Russian Federation than for the world’s less developed regions. The unpd envisions that Russian male life expectancy will catch up with the less developed world’s levels by 2020-2025 — but for reasons just reviewed, such projections may prove too optimistic. It is hard to see how Russia can hope to develop a First World economy on the backs of a work force with a Third World health profile, and a Third World health profile is almost certainly Russia’s lot for the foreseeable demographic future. Consequently, it may not be too much to suggest that unfavorable mortality trends constitute a tangible factor that will constantly impede Russia’s recovery of economic potential, and restoration of influence on the world stage, in the decades just ahead.

Furthermore, Russia’s health future may look rather worse than we have so far suggested, for our analysis has as yet taken no measure of the possible impact of hiv/aids. hiv/aids has already made major inroads in Russia and could turn out to be a major cause of death nationwide in the years to come. Reliable estimates of hiv prevalence in Russia today are lacking — but in October 2002 a study by the U.S. National Intelligence Council (nic) suggested that as many as 1 million to 2 million Russians might be hiv-positive, and in May 2003, Dr. Vadim Pokrovsky, head of the Russian Federal aids Center, indicated that Russia’s hiv population might be as large as 1.5 million. By such figures, as many as 2 to 3 percent of Russian adults aged 15–49 could already be infected with hiv. Our limited understanding of hiv/aids means that we have no terribly accurate methods for predicting the future trajectories of the pandemic — but for what it is worth, the nic study suggested that adult hiv prevalence might reach 6 to 11 percent by the year 2010. Even presuming a less virulent spread of hiv through Russia, however, the impact of aids would be utterly devastating. A demographic-epidemiological modeling exercise for hiv in Russia undertaken by the author indicated that even with an epidemic stabilized by 2025 at 2 percent adult prevalence — a level possibly lower than Russia’s actual existing burden of hiv infection — life expectancy progress in Russia might be cancelled for the next decade. If hiv prevalence ends up closer to 6 percent, Russia’s life expectancy in 2025 would be a decade lower than otherwise anticipated — meaning it would be distinctly lower than today — lower even than at the time of Stalin’s death. And a 10 percent hiv prevalence rate would knock 16 years off Russia’s prospective 2025 life expectancy, pushing it into essentially sub-Saharan coordinates.

Russia, of course, is not the only Eurasian country with a gathering hiv problem. India and China are two others. The aforementioned nic study ventures to place China’s and India’s current hiv-positive populations at 1-2 million and 5-8 million, respectively — and suggests hiv populations in 2010 of 10-15 million for China and 20-25 million for India. Despite the horrific absolute totals, these figures imply lower levels of adult hiv prevalence than in Russia (1.3-2 percent in China, 3-4 percent in India.)¹² But even these more moderated hiv trajectories would have terrible consequences for national health. With 1.5 percent adult hiv prevalence in 2025, projected life expectancy would be depressed by about four years for both China and India; with 3.5 percent prevalence in China and 5 percent prevalence in India, life expectancy progress over the coming generation could be cancelled altogether.

Given the fairly tight correspondence between life expectancy and economic productivity across countries or within countries over time, it is reasonable to surmise that major health setbacks imposed by hiv/aids would have economic repercussions for the Asian and Eurasian countries affected. The notion of a major economic impact from hiv seems all the more plausible when one considers that 1) hiv/aids is a lingering and debilitating disease; 2) it tends to hit individuals in the prime of their economically productive lives; 3) widespread hiv prevalence could alter individual calculations about investment in training and higher education; and 4) it could equally affect international business confidence in severely impacted areas. Thus, although we cannot yet foresee the course that hiv/aids may run in Asia/Eurasia, it is not premature to suggest that it could turn out to be a wild card, impairing the strategic options in coming decades of one or more major actors on the Asian/Eurasian scene.

Sex ratio imbalances

or ordinary human populations, irrespective of era or locale, there is a pronounced and unyielding biological regularity to the balance at birth between males and females: Slightly — but only slightly — more boys than girls can be expected at delivery. Broadly speaking, this observed sex ratio at birth has tended to fall in the range of 103 to 105 baby boys for every 100 baby girls. This stable, seemingly fixed relationship was among the first facets of human population structure that the earliest students of demography noticed and speculated about.

In contemporary Asia, however, this age-old balance is coming undone. In large parts of the expanse, the sex ratio at birth has risen to unnatural and historically unprecedented levels over the past two decades — and in many spots this tendency appears to be continuing unabated, or even to be intensifying further. The growing surfeit, in various Asian locales, of “excess boys” today may have far-reaching implications for social life — and possibly even political affairs — tomorrow.

The most dramatic departure from historic biological norms seems to have occurred in the People’s Republic of China. In China’s 1953 and 1964 censuses, unexceptional infant sex ratios (104 to 105 for babies under 1 year of age) were reported. In the 1982 census, however, a sex ratio of almost 108 was recorded — and subsequently it became clear that this apparent anomaly was not a temporary aberration. In the subsequent national population counts, China’s reported sex ratio at birth rose inexorably — to almost 112 in 1990, then nearly 116 in 1995, and most recently to just under 118 in the November 2000 census.

There are, to be sure, reasons to question the accuracy of these numbers: Reported birth totals in the 2000 Chinese census, for example, are implausibly low, leaving open the possibility that baby girls are disproportionately undercounted, while Chinese hospital data record a less extreme (albeit still unnatural) trend in sex ratios at birth for the charges on their premises.¹³ But the result itself cannot be dismissed as a statistical artifact. For one thing, there is a striking consistency between the results of successive population counts. The same imbalance that is reported in the 1990 census between baby boys and girls shows up for 5-year-olds in the 1995 census, 10-year-olds in the 2000 census, and so on. For another, the reported imbalance for the sex ratio of young children is even higher than that reported for infants. Indeed, in China’s 2000 population count, the recorded sex ratio for children aged 1–4 was over 120. Only two provinces in the entire country — the non-Han regions of Tibet and Xinjiang — reported sex ratios within the biologically normal human range. At the other end, three provinces (Hubei, Guangdong, and Anhui) tabulated child sex ratios of almost 130 — while three others (Hainan, Hunan, and Jiangxi) returned with ratios of over 130.

What accounts for China’s extraordinary new patterns in sex ratio at birth and in infancy? Closer examination suggests the outcome can be explained as a consequence of three colliding forces: 1) strong and enduring cultural preference for sons; 2) low or sub-replacement fertility; and 3) the advent of widespread technology for prenatal sex determination and gender-based abortion. To judge by the data on sex ratio by birth parity, Chinese parents today are typically willing to let nature take its course in the sex of their firstborn child but have become increasingly disposed to intervene themselves to assure that a second or third child is a boy. Indeed, according to the 2000 China census, over two-thirds of all “higher order” infants born in the previous year were male.

China’s tilt toward biologically impossible sex ratios at birth seems to have coincided with the inauguration of its coercive antenatal “one child policy,” which was unveiled in 1979. Is Beijing’s population control program responsible for these amazing distortions? A tentative answer would be yes — but not entirely. In other Chinese or Confucian-heritage populations where oppressive population control strictures were not in force — Hong Kong, Taiwan, Singapore, South Korea — unnatural sex ratios at birth also emerged in the 1980s and 1990s. In these other spots, the confluence of son preference, low fertility, and sex-selective abortion likewise have distorted the sex ratio at birth — although nowhere so much as in China today. In most of those other locales, moreover, recent data suggest that sex ratios at birth are lower than they were in the early 1990s (Taiwan, South Korea) or even the 1980s (Singapore), while China’s rise shows no signs of reversing.

“Missing girls,” to be sure, is not an entirely new feature of the Chinese population profile. Quite to the contrary, available demographic data strongly suggest that China suffered a surfeit of “excess men” in more traditional, pre-communist times.¹⁴ That earlier pattern, however, spoke to unfavorable survival prospects for infants, girls, and women, not to gender imbalances at birth. Traditional China, moreover, was characterized by relatively high levels of fertility and over many long stretches experienced sustained population growth. In that dynamic, ever-larger numbers of women were rising through the nation’s population pyramid. The situation promises to be very different in the coming decades. Thanks to China’s tilt below replacement fertility in the early 1990s, from about 2010 onward each cohort of women in their early 20s will be smaller than the one before. Between 2010 and 2025, this cohort will in fact shrink appreciably — by almost one-fourth, according to unpd projections. (Not much guesswork is involved here, incidentally. Nearly all of the women in question have already been born.)

The prospect of steadily diminishing absolute numbers of women of marriageable age, in conjunction with a steadily increasing surfeit of young men in each new class of prospective bachelors, sets the stage for an historically unprecedented “marriage squeeze” in China in the decades immediately ahead. Simple, back-of-the-envelope arithmetic suggests that some very large proportion of tomorrow’s young Chinese men — certainly over 10 percent, perhaps 15 percent or more — may find themselves essentially “unmarriageable” on the mainland in the coming decades.

In other places and at other times, significant proportions of the male population completed their lives without ever marrying. In Western Europe in the pre-industrial and early industrial periods, for example, it was not uncommon for 15 or 20 percent of a male cohort to remain unmarried.¹⁵ But that Western European pattern was built on a complex and delicate foundation: a mesh of ethical precepts and social arrangements that supported and ratified the institution of honorable bachelorhood.

No similar cultural foundations can be said to exist today in China, where until now the expectation of universal male marriage has prevailed and where Confucian tradition stresses the son’s obligation to marry and honor one’s ancestors by continuing the family line. A shift to the embrace of honorable bachelorhood would mark a radical departure for Chinese society — and important new cultural traditions, in China or elsewhere, are seldom successfully established on short notice.

The world has never before seen the likes of the bride shortage that will be unfolding in China in the decades ahead, so it is difficult to imagine its many reverberations. Some commentators have warned that this “surplus of males” will make for a “deficit of peace,” pushing China toward a more martial international posture.¹⁶ That assessment may rather overstate the actual case for demographically induced risks of international conflict in Asia (just as slightly earlier literature’s predictions of a pacifistic, casualty-averse turn in the disposition of graying, low-fertility Europe did not anticipate or account for the savage international policy of aging, sub-replacement Serbia in the 1990s).¹⁷

It does not seem wild, however, to propose that the emergence and rise of the phenomenon of the “unmarriageable male” may occasion an increase of social tensions in China — and perhaps social turbulence as well. Exactly how China’s future cohorts of young men are to be socialized with no prospect of settled family life and no tradition of honorable bachelorhood is a question that can be asked today, but not answered. (Questions may equally be raised, without any good answers, about the bearing of China’s rising and not necessarily celibate bachelor class on the risks of hiv transmission in the decades ahead.) And it is hard to see how Beijing will be able to mitigate China’s escalating “bride deficit” through any deliberate policy actions for at least a generation (unless of course Beijing stumbles upon a method of manufacturing full-grown Chinese women on demand).

China will be the first great power in Asia to suffer from a twenty-first century “bride shortage,” but it may not be the last. Unsettling trends of a similar nature are already evident in India.¹⁸ Son preference in India remains extremely strong; according to national survey results, women venturing a preference for their next birth voted for boys over girls by a ratio of four to one. With declining fertility and the spread of ultrasound, India’s sex ratio is already on the rise. In the 2001 census, India counted almost 108 boys under age 6 for every 100 girls. In Uttar Pradesh, India’s most populous state, that ratio was over 110; in Delhi, it was over 115; and in Punjab it was reportedly 126.¹⁹

It would be cheering to think that the gender imbalances emerging in Asia’s major population centers were a vestige of backward ideas and will consequently pass away with increasing modernization. The facts to date, unfortunately, do not support such an interpretation. In both India and China over the past two decades, the nationwide sex ratio at birth has increased along with per capita income, female literacy rates, and urbanization. In China today, the more literate provinces tend in fact to have somewhat higher, not lower, sex ratios at birth; and in India it is urban, not rural, areas in which the disproportion between boys and girls is greatest. For the time being, we must live with the disturbing possibility that continuing “development” and “globalization” will heighten rather than reduce nascent gender imbalances in these two enormous countries — and the knowledge that these particular expressions of “Asian values” will have unpredictable but perhaps not inconsequential repercussions on society and politics in these ostensibly rising powers for decades to come.

Across the Pacific

If some countries in our conspectus appear to face especially disadvantageous demographic constraints, others enjoy relative strategic advantages from their own population circumstances. Interestingly enough, the Asian Pacific power with the most strategically favorable profile may be one that we have not yet discussed: the United States.

By the unpd’s medium variant projections, the United States is envisioned to grow from 285 million in 2000 to 358 million in 2025. In absolute terms, this would be by far the greatest increase projected for any industrialized society; in relative terms, this projected 26 percent increment would almost exactly match the proportional growth of the Asia/Eurasia region as a whole. Under these trajectories, the United States would remain the world’s third most populous country in 2025, and by the early 2020s, the U.S. population growth rate — a projected 0.7 percent per year — would in this scenario actually be higher than that of Indonesia, Thailand, or virtually any country in East Asia, China included.

In these projections, U.S. population growth accrues from two by no means implausible assumptions: 1) continued receptivity to newcomers and immigrants and 2) continuing “exceptionalism” in U.S. fertility patterns. (The United States today reports about 2.0 births per woman, as against about 1.5 in Western Europe, roughly 1.4 in Eastern Europe, and about 1.3 in Japan.) Given its sources, such population growth would tend, quite literally, to have a rejuvenating effect on the U.S. population profile — that is to say, it would slow down the process of population aging. Between 2000 and 2025, in these unpd projections, median age in the United States would rise by just two years (from 35.6 to 37.6). By 2025, the U.S. population would be more youthful, and aging more slowly, than that of China or any of today’s “tigers.” (Furthermore, to state the obvious, neither a resurgence of hiv/aids nor an eruption of imbalanced sex ratios at birth look to be part of the U.S. prospect over the decades immediately ahead.)

One may of course debate the magnitude of the impact of such relative demographic advantages. For the time being, however, it would appear that demographic trends may, in some limited but tangible measure, contribute to the calculus of American strategic preeminence — in the Asia Pacific region, and indeed around the world.

2006-10-16T09:39:00.000-07:00

For video insight go to: http://www.learner.org/resources/series180.html#
In order to watch the videos you will need to sign into the organisation.
The videos to watch for this unit are:
9. Changes on the Chang Jiang
Shanghai: Head of the Dragon — Shanghai enters the 21st century on a wave of development, ready to reclaim its legacy as China’s commercial center. Sijia: Small Town, Big Change — The steady growth of a township enterprise illustrates three great contrasts in modern China: rural vs. urban, agricultural vs. industrial, coastal vs. interior.

10. The Booming Maritime Edge
Guangdong: Globalization in the Pearl River Delta — This program explores globalization and the effects of modernization on Chinese society. Taiwan: High-Tech Tiger — What factors contributed to Taiwan’s emergence as a high-tech powerhouse?

11. A Challenge for Two Old Cities
Lanzhou: Confluence of Cultures — We travel to the frontiers of Han and Muslim China in the city of Lanzhou. Shenyang: Hope for China’s Rust Belt? — A previously dynamic industrial city continues to struggle with modernizing its manufacturing infrastructure.

2006-10-16T05:28:00.000-07:00

1) To what extent has Shanghai followed the development strategy of Singapore?

2) Has foreign direct investment been important for Shanghai's development?

3) How has China's entry into the WTO in 2001 influenced the development of Shanghai?

4) Assess the role of the Chinese coastal area in the economic development of China.

Use Shanghai as a case study.

http://www.sfisc.com/en/shgk.asp

See Special Economic Zones
http://en.wikipedia.org/wiki/Shenzhen
http://en.wikipedia.org/wiki/Guangdong

For background information on China see http://news.bbc.co.uk/2/hi/in_depth/asia_pacific/2004/china/default.stm

Shanghai Overview

The word "Shang Hai" is literally translated to "above the sea" as the city of Shanghai was built 500 years ago on the bank of the Yangtze River Delta, with East Sea in the east and Hangzhou delta in the south. Shanghai summers are hot and humid with temperatures reaching 40 degrees Celsius. The rainy season begins in June. Fall is mostly mild. In winter (January to February) temperatures can reach below freezing. Spring begins again in March.

Housing a population of over 16 million at present, it was once a small town supported by fishing and weaving before the first Opium War. Late in 1990, the central government started developing the area, and Shanghai has since become the well-known booming metropolis city.

A first sight at Shanghai is an overwhelming impression of towering skyscrapers and the sheer number of bicycles. Shanghai story usually begins at the Bund, where many buildings constructed in various foreign styles are well preserved. Western tourists will feel a sense of familiarity when strolling around the long street, which resembles those in European cities. This blending of eastern and western styles has given the Bund a reputation as a "World's Fair of Architecture." A visit to the Old City section gives an overview to buildings of the 1920s and 1930s style. A good collection is displayed in Yu Garden, a well-restored Suzhou-style garden created during the Ming Dynasty. The garden is immensely popular with local residents and visiting Chinese. Jade Buddha Temple in northwest is the most popular Buddhist temple in Shanghai, drawing both worshippers and tourists.

Pudong, the east side area of the Huangpu river, has been transformed from farmland to mega-metropolis. The Oriental Pearl TV Tower, with a giddy height of 468 meters, stands as the world's third tallest TV tower and has become the new symbol of Shanghai. The 88-floor Jin Mao Mansion is another outstanding building in the Pudong New Area. Because of its brightly illuminated skyscrapers, Shanghai enjoys international fame as the "Pearl of the Orient".

Economic Development

Incredibly crowded, densely packed, Shanghai is the biggest port and the center of technique, trade, finance, information and culture in China. With energy and confidence, Shanghai is having new dreams. The polluted rivers are being cleaned up and greenways and new parks are emerging. Historic neighborhoods, both Chinese and colonial, are being spared the bulldozer and transformed into avenues of shops and cafes. New theaters and cultural centers are attracting top performers from China and abroad.

Shanghai plays an important role in China's social and economic development. With a population of 16 million, Shanghai contributes 1/12 of China's total industrial output value, 1/6 of China's port cargo handling volume, 1/4 of China's total exports and 1/8 of China's financial revenue. In 2003, Shanghai's GDP reached 622.8 billion RMB (equivalent 75.31 billion USD) up around 90 times over that of 1952 according to the comparable prices. The average annual growth rate became double digit during the last several decades and hit 11.8% last year.

In 1952, Shanghai's average per capita GDP was only 430 Yuan (equivalent USD 52). In 1978, it reached 2,498 Yuan (USD 302), surpassed 10,000 Yuan (USD 1,209.2) for the first time in 1990 and soared to 34,600 Yuan or 4,180 USD in 2000.

Shanghai has long been a major textile manufacturer, producing material for China's domestic fashion industry. It is also China's second largest iron and steel producer and a major refining centre for copper, lead, and zinc. An oil refinery supplies materials for the city's petrochemical and synthetic fibre industries. Chemicals, plastics, cars, pharmaceuticals, electrical appliances, and fertilizers are also produced, in addition to paper, agricultural machinery, precision instruments, and shipbuilding. Other industries include vegetable oil milling and oil refining.

Foreign capital has been floating to this booming city since it began overall reforms over a decade ago. Up to the end of last year, Shanghai had received 31,440 foreign invested projects, total value of which amounted to over 73 billion USD.

Shanghai's well-deserved reputation as China's commercial capital has grown faster in recent years as infrastructure development has resulted in vastly improved transportation (including new highways, bridges, tunnels, subway lines, a new international airport and increased port capacity). Business centers in Puxi have continued to be a magnet to foreign executives overseeing their operations in China, and the Lujiazui financial district in Pudong is home to China's largest stock exchange¡ªthe Shanghai Stock Exchange. The newly built magnetic levitation train enhances Shanghai's stature as a world class business center.

Role of specialised industrial parks

The automobile & auto parts manufacturing park in Shanghai International Automobile City
Shanghai Auto Parts Global Sourcing Center provides the manufacturing park an interface between home and abroad, which expands the potential market. The manufacturing park is a key base of the auto sedan and spare parts in China. About 100 enterprises from more than 10 countries and regions such as Germany, U.S, Japan, Singapore and Taiwan have already settled down.

II Main functions of Shanghai Auto Parts Global Sourcing Center
Main functions：
Exhibition:a key factor of modern and advanced sourcing modes
Trading: to meet the requirements of auto parts vastitude sourcing
Information: data base of resources for trading and exhibition development Other functions:
Commerce: facilities to support the commercial activities
Finance: an essential part of the modern and advanced sourcing mode
Service: to provide clients with completed services

III Advantages of the project
＊The goal of Shanghai municipal government: make the city an International merchandising base within 5 years. The project is one important part of this development strategy.
＊Supported by Shanghai municipal government, Jiading local government, China Association of Automobil Manufacturers and other institutes.
＊Based on the global platform of Shanghai International Automobile City.
＊Get orders from big overseas manufacturers by the professional capabilities.
＊Test and verify the members for their prestiges and capabilities and ensure the members' professions and top brands.

http://www.smudc.com/en/ground/changfang.htm

FDI by Shanghai multinationals

MG Rover-SAIC Incompleted Negotiation

In August 2004, it was learned that SAIC was in talks to buy Britain's MG Rover Group. In November, it was announced that SAIC could take a 70% stake in a joint venture company shared with MG Rover in return for its £1 billion investment.

In March 2005, Shanghai Automotive Industry Corporation (SAIC) and Nanjing Automobile Corporation (NAC) announced their intentions of acquiring 50% and 20% shares of MG Rover respectively.

However, in April 2005, it emerged that SAIC would not proceed with the MG Rover deal, after concerns about the British automaker's financial stability. This news sent MG Rover into administration.

SAIC had claimed that it had already acquired Intellectual Property Rights in some Rover products for £67 million in the autumn of 2004, including the Rover 25, the Rover 75 and the Rover Powertrain K-series engine, but the Administrators advised that there was still interest in saving some other parts of the company, including MG, and Friday, May 13, 2005 was set as the deadline for bids from potential investors.

In June 2005, it emerged that SAIC held the rights to the MG TF sports car. Commentators in the British media claimed that the rights were transferred by its former owner, MG Rover, to SAIC accidentally.

SAIC bid for MG Rover assets but on July 22nd 2005, the Nanjing Automobile Corporation purchased the British Group for £53 million.

Having bought the rights to a number of Rover models, the group tried to purchase the Rover name from BMW Group for £11m, but this bid also failed and the Rover brand eventually went to the Ford Motor Company Inc. of the USA after its exercised its right over the name following its purchase of Land Rover in 2000.

The company has plans to release an updated version of the Rover 75 under the Lu-sheng 75 ('Road-Splendor' 75) name, under the main brand name of Roewe.

http://en.wikipedia.org/wiki/Shanghai_Automotive_Industry_Corporation

Importance of the Port

http://www.atimes.com/atimes/China_Business/HA07Cb02.html

Asian Times 07/01/2006

Shanghai now the world's largest cargo port

SHANGHAI - Shanghai port has become the world's largest cargo port, with processed cargo topping 443 million tons in 2005, higher than that of Singapore's port, according to the latest statistics of the Shanghai Port Management Department.

The rapid development of the Chinese economy and the large industrial and trade base of the Yangtze River Delta region are the main reasons underlining Shanghai's achievement. It only took

Shanghai port five years to double cargo handling capacity from 200 million tons to 400 million tons.

However, there is still a big gap between Shanghai and Singapore in container handling capacity. The latest statistics show that Shanghai handled 18.09 million TEUs (twenty-foot equivalent units) of containers in 2005, rising 24.2% over the previous year and taking the third position in the world. In contrast, Singapore handled 21.2 million TEUs in the first 11 months of 2005, rising 8.4%. In terms of growth rate, the container handling capacity of Shanghai grew much faster than that of Singapore.

The economic development of Shanghai, the Yangtze River delta and Yangtze River valley has also fueled the development of Shanghai port. At present, Shanghai has opened shipping lines around the globe, extending to Europe, America, Australia, Japan and Southeast Asia. The number of voyages mounted from the port amounts to 1,967 monthly, including 942 to international ports.

Development of Commerce and Financial Centres

http://www.shanghai.gov.cn/shanghai/node8059/BasicFacts/Infrastructure/userobject22ai22013.html

Lujiazhui Financial and Trade Zone has enjoyed increasing number of financial institutions, and a modern service system has been established . By the end of 2005, a total of 360 Chinese and foreign financial institutions had started operation in this zone. A number of world multinational corporations, such as Citibank’s Asia-Pacific headquarters, Pacific Insurance, UPS, Siemens and Wal-Mart, and some of China's largest corporations have moved their headquarters to Lujiazhui. Its function as venues for conference, exhibition, tourism and commercial space leasing further expanded. In the year, 1,420 major meetings, including more than 180 international ones, were held in the zone. By the end of 2005, there were ## skyscrapers either completed or under construction in the district, with an occupancy rate of 92.5%.

Growth into the periphery

Growth is being directed away from Shanghai because of the increasing congestion in that city, as more companies are locating industries in places like Suzhou and Hangzhou. Suzhou is located about 90 kilometers west of Shanghai and Hangzhou is located 180 kilometers southwest of Shanghai.

Both Suzhou and Hangzhou are populated by about six million people with about one million or so living in the central core and each city is quickly upgrading its road network to cope with rising transportation demand.

The centre of Suzhou, known as the Oriental Venice with its famous gardens and nine-story pagoda, is listed by the United Nations as a World Heritage site. However, two new industrial parks located adjacent to this centre have forced the city to build a “motorway” to link the two parks. But in doing so, a large Right-of-Way was built directly through the cherished city centre, creating opposition from groups wanting to protect their special cultural heritage. While the necessity to link these parks was great, Vice-Mayor Du Gou-Ling vowed that no further intrusions will be allowed through the historical centre.

Hangzhou is regarded as the “Paradise Silicon Valley” where in 1990, the Hangzhou Hi-tech Industry Development Zone was established. It is dedicated to the commercialization, industrialization and internationalization of scientific and technological achievements to transfer high technology into direct productive forces. Its industries include: micro-electronic information, biomedicine, new materials, optical-mechanical-electrical integration, computer technology, and software. The success of this venture has brought substantial economic benefits to Hangzhou.

Hangzhou is so well regarded in Asia, that the city has been named as the best place to do business according to the Forbes China Report. However, its growing economic success has also increased pressure on its urban transportation infrastructure, forcing the city to expand the road network. Predictably in Hangzhou, there are similar environmental and heritage concerns about expanding the road network. www.magplane.com/html/word/Hangzhou%20September%20(3.1).doc

Plans for development

Shanghai: an opening-up and modernizing city

Speech by Ms. Yang Dinghua, Secretary General of Shanghai Municipal People's Government (2006/04/17)

India, April 11, 2006

China and India are close neighbors with increasing trade and economic exchange. Last year, the bi-lateral trade between China and India stood at $18.7 billion, up by nearly 40% over last year. It's projected that the bi-lateral trade this year will exceed $20 billion. In this context, Shanghai's economic and trade exchange with India has also grown rapidly. Last year, the import and export between Shanghai and India reached $1.7 billion, an increase of 37% over last year. As of the end of 2005, India had 28 investment projects in Shanghai with contractual value of $25 million, covering sectors such as software, information and biology. We are delighted to see that the Sino-Indian relations have entered a brand new stage featuring overall development.

Today, senior officials from the government, entrepreneurs and scholars come together to have extensive and in-depth discussions of urban construction and economic development at this forum, which is a very important platform as well as a very good opportunity for us to promote communication and cooperation and benefit from each other's strength. I would like to avail myself of this opportunity to make a presentation on Shanghai's latest development.

Shanghai is an international megacity with a permanent population of 18 million. Shanghai is also an economic center, holding a very important position in the national economy. Since China adopted its reform and opening-up policies, in particular, after the central government made the decision to carry out pilot reforms and opening-up measures in Pudong, Shanghai has ushered in a new period and scored enormous achievements in its modernization drive, becoming an epitome of China's rapid socio-economic development.

Shanghai has realized sustained, smooth and relative fast socio-economic development. Since 1992, Shanghai's GDP has been growing at a double-digit speed for 14 consecutive years. The GDP of Shanghai in 2005 reached $11 billion. With rapid economic development, the social undertakings including science and technology, education, culture, public health and sports also made great progress. As a result, the living standards and quality of the Shanghai people have improved significantly. Now, the per capita floor area of urban residents reached 25M2, and the average life expectancy is 80 years old.

Shanghai stands at the forefront of China's reform and opening up. By the end of 2005, Shanghai has attracted more than 40,000 foreign-invested companies and received actualized Foreign Direct Investment (FDI) of nearly $60 billion. 430 out of the Fortune Global 500 have established presence in Shanghai. More than 400 regional headquarters of the multinational companies (MNCs), investment companies and R&D centers are now in Shanghai. What's more, Shanghai has successfully hosted many international conferences, such as the APEC meeting and the Fortune Global Forum. In December 2002, Shanghai won the bid to host the 2010 World Expo.

Shanghai is transforming from an industrial and commercial city to an economic center of China. Shanghai hosts a number of national-level factors market including securities, foreign exchange, gold, futures, IPR, technology and human resources, making Shanghai an economic center of China. The volume of tradable securities of Shanghai Stock Exchange (SSE) accounts for nearly 80% of the national total, and the volume of the futures market 50% of the national total. Shanghai also hosts the largest number of foreign-invested financial institutions in China. As of the end of 2005, there were more than 300 foreign-invested and Joint Venture financial organizations.

Shanghai has strengthened its position as a trading port and boosted its shipping capacity. Shanghai is the biggest port in China. As a shipping center, Shanghai's capacity has been constantly enhanced. In 2005, Shanghai handled foreign trade worth $350 billion, up by 24.1% over last year, accounting for more than a quarter of the national total. The cargo throughput reached 443 million tons, up by 16.9% over last year, becoming the world's largest port. The container throughput of Shanghai reached 18 million TEUs, 3.5 million more TEUs than last year, remaining the third largest container terminal. Meanwhile, the Pudong and Hongqiao airports of Shanghai handled over 41 million passengers, up by 15.3% over last year. The throughput of air cargo and mail reached 2.2 million tons, up by 14% over last year.

Ladies and Gentlemen, from this year on, Shanghai will be implementing its 11th five-year program. The first two decades of the 21st century is an important period of strategic opportunities for China. By 2020, Shanghai will become one of the economic, financial, trade and shipping centers of the world ("Four Centers"). Focusing on this development goal, in the coming 5 years, Shanghai will implement in earnest the scientific approach to development, make efforts to build a harmonious society, stick to development as our top priority, forge ahead with reform and opening up, improve people's lives and rally our work around the central objective of increasing Shanghai's international competitiveness. Shanghai will put in place the general framework for the "Four Centers" initiative, host a successful, wonderful and unforgettable World Expo and continue to improve the living standards of our people through rapid and sound economic and social development. To this end, we would focus on the following priorities.

1. We will transform the model of economic growth and put in place a service sector-driven industrial structure. We will unswervingly promote industrial restructuring, giving priority to the modern service sector and the manufacturing sector. The tertiary sector will contribute more than 50% to the city's GDP, and in the central districts, the percentage should be higher than 70%. On the one hand, by leveraging the strength of information and communications technology (ICT), We will place a premium on the financial and modern logistics industries and create modern service clusters so as to raise the level, size and added value of the modern service sector. On the other hand, we will introduce new technologies, processes and equipment to the advanced manufacturing sector so as to reach higher levels of technological sophistication, develop more proprietary core technologies and strong brands, thereby boosting the competitiveness of this sector.

2. We will increase the capacity for independent innovation and build an urban innovation system. Innovation capacity is crucial for a city's international competitiveness. By 2010, R&D expenditure will reach 2.8% of Shanghai's GDP. The contribution rate of technological progress will be around 65%. Therefore, We are committed to developing an innovation system with stronger capacities for locally pioneered innovation, innovation through integration and re-innovation through the internalization of imported technologies. The development of a business-led innovation system will gain further momentum. Shanghai will become an innovation-oriented city.

3. We will forge ahead with reform and opening up by taking full advantage of Pudong's head start gained by the pilot projects being implemented there. Reform is a strong driving force for economic and social development. Spearheaded by Pudong's pioneering efforts in development and opening-up, reforms will firmly maintain their socialist market economy orientation. We will intensify the comprehensive and simultaneous reforms of the government, the business, the market and society. We will also implement the opening up policies unswervingly in accordance with our WTO commitments and the master plan of the country.

4. We will build a harmonious society and continue to improve the living standards of the people. The ultimate objective of development is to improve people's lives. We will adopt a putting-people-first approach, accelerate the development of social undertakings, improve public service and promote overall human development. We attach great importance to the living standards of our people by focusing our work on employment, housing and social security.

5. We are making proactive efforts to prepare for the 2010 World Expo with a view to presenting a successful, wonderful and unforgettable World Expo. Regarded as "Olympics in the areas of economy, culture, science and technology", World Expos are top-level comprehensive exhibitions of far-reaching influence. The theme of 2010 Shanghai World Expo is "Better city, Better life". It is the first time for a developing country to host World Expo. It is estimated that nearly 200 countries, international organizations and companies will participate in it with an audience of more than 70 million people. Planning against high technological, ecological and cultural standards, we are now making all out efforts to make the 2010 World Expo in Shanghai a platform to show the fruits of world's economy, science and technology, to share cultures and arts and to promote friendly communication.

Ladies and Gentlemen, a city's development would not be possible without the development of modern infrastructure. This is particularly so in Shanghai. In order for Shanghai to become an international economic, financial, trade and shipping center, Shanghai's role as the regional hub must be strengthened by laying emphasis on key projects of infrastructure. In this regard, Shanghai has formulated a good plan, the three pillars of which are transportation, environmental protection and regeneration of old neighborhoods.

First, we will forge ahead with the development of key infrastructure focusing on hubs, functionality and networks. Our objective in the area of seaport development is to rank Shanghai among ports with the largest container throughput and to establish Shanghai as one of the international shipping centers by 2010. Last year, the phase one project of Yangshan Deepwater Port and the Yangshan Free Port Area were officially put into operation. We will expedite the development of follow-up projects and improve the soft environment for the shipping industry. In the area of airport development, our objective is for Shanghai to become an aviation hub by 2010. By then, there will be five runways in the Pudong International Airport, handling 80 million passengers and 5.7 million tons of cargo annually. For the Hongqiao International Airport, there will be two runways, handling 30 million passengers every year. In the area of Information Port, our objective is to build Shanghai into an ICT-enabled city by 2010. At present, Shanghai already has a relatively sophisticated information infrastructure. The next step of our work is to further expand ICT applications in economic and social development while improving the existing infrastructure. Our objective in the area of rail transport is to put in place a basic network with 13 lines and total length in operation of 512 km. The target for 2010 is 11 lines and 400 km. In the area of expressways, our objective is to put in place a full-fledged network with 880 km of roads open of traffic. In the area of waterways, we will step up the development of a high-grade inland waterway network featuring one ring and 10 spoke-like major waterways.

Second, we will strengthen environmental protection and ecological conservation. Since the 1990s, Shanghai has implemented the strategy of sustainable development. In particular, Shanghai implemented two rounds of the Three-Year Plan of Action for Environmental Protection. For 6 years in a row, the investment in environmental protection has been more than 3% of Shanghai's GDP with a total of $14 billion. In 2002, Shanghai was awarded by the United Nations for its special contribution to urban sustainable development. Aiming at building an eco-friendly city, Shanghai will implement the third round of the Three-Year Plan of Action for Environmental Protection. We will further improve water quality, control air pollution, development treatment facilities to handle solid wastes, industrial and agricultural pollution. Meanwhile, we will also accelerate industrial restructuring so as to phase out heavily polluting enterprises and promote clean production. As a result, we hope Shanghai will have bluer sky, greener land and cleaner water.

Third, we strike a good balance between preserving the historical cultural heritage and regenerating the old neighborhoods in our efforts to improve the living conditions and living environment of our people. We will further increase the green area in the central districts and public space, control over development and the layout of high buildings so as to provide a better environment for the people.

Ladies and Gentleman, through our unremitting efforts, Shanghai will become a more glorious international metropolis. A thousand mile journey begins with the first step.We will march towards our set goals confidently. We are also very clear that Shanghai can learn so much from the experience of many famous cities of the world, including Delhi. Our friends from India are more than welcome to pay a visit to Shanghai. I believe we can strengthen our mutual understanding and cooperation to write a new chapter of friendship.

Thank you for your attention!

2006-10-09T08:56:00.000-07:00

China

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Foreign Trade

In 2003, China's import and export trade volume totaled US$850.99 billion, with an increase of 37.1 percent over 2002, ranking 4th in world trade. This compares to China's coming in 32nd in 1978, 15th in 1989, 10th in 1997 and 6th in 2001. At present, more than 220 countries and regions in the world have trade exchanges with China. The 10 major trade partners of China's mainland are: Japan, the United States, the European Union ("EU"), the Hong Kong Special Administrative Region, the Association of Southeast Asian Nations ("ASEAN"), the Republic of Korea, Taiwan Province, Australia, Russia and Canada.

Overseas Investment

According to statistics from the Ministry of Commerce, China by the end of 2002 had a net volume of direct overseas investment that came to US$29.92 billion (not including finance); and a sale's volume for its overseas enterprises for the year that topped US$77.2 billion. In September 2002, China's TCL Corporation purchased the Schneider Company, a German TV set manufacturer. In 2003 TCL teamed with Thomson, the biggest French consumer electronics company, to establish TCL-Thomson Company, which has an annual production capacity of 18 million TV sets, as the biggest TV sets producer in the world. China's largest household electronic appliances producer, the Haier Group, has expanded its refrigerator factory in South Carolina of the United States, making it capable of producing 400,000 to 500,000 refrigerators a year. The Haier Group has also set up 13 factories in Europe and South America. The largest Chinese computer company, the Lenovo Group Limited, also rapidly expanded its overseas market, planning to raise its presently 4 percent export rate to 20 percent before 2007.

Income

Tremendous changes have taken place in the lifestyle of the Chinese people in the past 50 years, especially in the past two decades as average income has increased steadily. People in China today have money to buy or invest in houses and apartments, cars, computers, stock and traveling abroad. China's GDP per capita exceeded US$1,000 in 2003, calculated according to the current exchange rate. Between 1978 and 2003, the net income per rural resident increased from 134 to 2,622 yuan, at the average annual growth rate of 7.1 percent in real terms; and the disposable income per urban resident increased from 343 to 8,472, at an average annual growth rate of 6.8 percent in real terms.

The increase in personal income is reflected in the growth of bank savings deposits. In the first 30 years of the second half of the last century, the balance of residents' savings deposits increased from 860 million yuan in 1952 to 21.06 billion yuan in 1978. In the 20 years after the initiation of reform and opening-up, the balance of personal savings deposits has increased in the geometric progression. In the eight years between 1979 and 1986, the balance of the savings deposits increased 10 times, reaching 223.85 billion yuan, which rose to 2,151.88 billion yuan in 1994. It means within the 16 years, the balance of the savings deposits increased 100 times. Six years later in 2000, the balance of personal savings increased to 6,433.24 billion yuan, or 304 times the 1978 figure. It reached 7,376.2 billion yuan in 2001, 8,691.1 billion yuan in 2002, and 10,361.8 billion yuan in 2003. Personal foreign exchange deposits, stocks, bonds, internal stocks, and cash have all grown by a large margin.

Consumption

Consumers in China today are spending their money on housing, transportation, telecommunications, medical and health care, culture, education and entertainment, leisure and tourism. This is remarkable in that not so long ago basic subsistence was a major concern of many citizens. As expenses for food, clothing and basic necessities dropped, the Engel coefficient (the proportion of food expenses of total consumer spending) of urban residents decreased from 57.5 percent in 1978 to 37.1 percent in 2002; and that of rural residents dropped from 67.7 percent to 45.6 percent. Today urban residents are shopping at supermarkets as well stocked as any of the best in the Western world and are enjoying dining out at fine restaurants. In rural areas, people are less dependent on grains and are eating more eggs and meat. Affordable, ready-made clothes are available everywhere with people dressing in the latest fashion, both Western and Chinese. In terms of housing, transportation and telecommunications — people are buying and replacing old household items and appliances with large-screen, high-definition color TV, refrigerators with freezers and other components, and the latest in washing machines, for example. Air conditioners, home entertainment units, water heater and furniture also are popular consumer items; video cameras, computers and exercise equipment are becoming commonplace in the average home. More people are buying cars. In 2003, the purchase of cars in China increased by 34.5 percent. Of every 100 cars sold, at least 60 were purchased by individuals, and that rate is as high as 80 percent in big cities. The consumption expenditure on housing has also kept growing, with its nationwide increasing rate for 2003 reaching 31.9 percent.

Overview

China's annual GDP growth has averaged more than 8 percent in the past 25 years, and in 2003, its GDP grew by a record-breaking 9.1 percent despite the outbreak last year in China of Severe Acute Respiratory Syndrome ("SARS"). Other signs of China's overall improving economic strength in 2003:

* The total government revenue was 2.17 trillion yuan (US$261.4 billion), 278.7 billion yuan (US$33.58 billion) more than the previous year.

* Foreign trade expanded significantly. Total import and export volume was US$851.2 billion, 37.1 percent more than the previous year, raising China from fifth to fourth place in the world;

* China created more jobs than planned. Some 8.59 million urban residents became employed, with 4.4 million laid-off workers re-employed;

* Personal incomes increased. Urban per capita disposable income grew by 9 percent in real terms, and rural per capita net income rose by 4.3 percent in real terms.

Noting these economic achievements as well as the complete success of China's first manned space flight in 2003, Premier Wen Jiabao in his annual address to the NPC in March 2004 pointed to a national strength that has reached new heights. At the same time, Premier Wen put forward only a moderate 7 percent growth target for the year ahead to seek to improve the socialist market economy through a "people-centered development" that coordinates development of the economy, society and individuals. CPC General Secretary Hu Jintao summed up the approach as a "scientific concept of development."

Economic System

In the first 30 years after the founding of the PRC in 1949, the Chinese government carried out a system of planned economy, and targets and quotas for various spheres of economic development were set by the "planning committees" of the state. Factories produced goods according to state plans, and farmers planted crops also according to state plans. Commercial departments replenished and sold their stocks according to state plans, and the qualities, quantities and prices of the goods were all fixed by planning departments. This system contributed to the stable, planned development of China's economy, but it also limited the development of the economy and sapped its vitality.

China's economic reforms began first in the rural areas in 1978, when the household contract responsibility system was introduced there. Under this system, farmers got the right to use the land, plan farm work and dispose of products independently. Farmers had more choices for selling their agricultural products. State monopoly of the purchase and marketing of agricultural products was eliminated; the prices of the majority of farm products were freed; many policies restricting agricultural development were abolished; and farmers were allowed to engage in diversified business and set up township enterprises. All this greatly increased farm production.

In 1984, the economic restructuring shifted from the rural areas to the cities, and in 1992, after some 10 years of reform and opening-up and with a clearer orientation toward the implementation of reforms and establishment of a socialist market economic system, the Chinese government set forth main principles for economic structural reform as follows:

The development of diversified economic elements will be encouraged while keeping the public sector of the economy in the dominant position.

To meet the requirements of the market economy, the operations of state-owned enterprises should be changed so that they fit in with the modern enterprise system.

A unified and open market system should be established in the country so as to link the rural and urban markets, and the domestic and international markets, and to promote the optimization of the allocation of resources.

The function of managing the economy by the government should be changed so as to establish a complete macro-control system mainly by indirect means.

A distribution system should be established in which distribution according to work is dominant while giving priority to efficiency with due consideration to fairness. This system will encourage some people and some places to become rich first, and then they may help other people and places to become rich, too.

A social security system, suited to China's situation, for both rural and urban residents shall be worked out so as to promote overall economic development and ensure social stability.

In 1987, the Chinese government set out a clear and definite economic construction objective: The first step was to double the 1980 GNP and ensure that the people have enough food and clothing. China attained this by the end of the 1980s. The second step was to quadruple the 1980 GNP by the end of the 20th century. This was achieved in 1995, ahead of time. The third step is to increase the per-capita GNP to the level of the medium-developed countries by the mid-21st century. At this point, Chinese people will have achieved a high standard of living and modernization basically will be realized.

In 1997, the Chinese government stressed that the non-public sectors of the economy were an important component part of the socialist economy of China, in which profitability was encouraged for elements of production, such as capital and technology. By 2002, reform in various fields was achieving remarkable results. A socialist market economic system has taken shape, and the basic role played by the market has been improved in the sphere of resources allocation. At the same time, the macro-control system continued to be perfected.

In March 2003, following the First Session of the 10th National People's Congress, China restructured these key economic ministries:

The State Development and Planning Commission ("SDPC") was renamed the National Development and Reform Commission ("NDRC") and absorbed the duties of the State Council Office for Economic Restructuring and some functions of other ministries;

The operations of the State Economic and Trade Commission ("SETC") and the Ministry of Foreign Trade and Economic Cooperation ("MOFTEC") were folded into a new Ministry of Commerce responsible for oversight of all domestic and foreign trade.

A new State Assets Management Commission ("SAMC") assumed responsibility for managing and restructuring state-owned enterprises ("SOEs").

A new China Banking Regulatory Commission ("CBRC") was given responsibility for supervision and regulation of the banking sector.

The pattern in which the public sector of the economy plays the main role and coexists with non-public sectors of the economy such as individual economy and privately owned economy for common development has basically been formed.

Diverse Economic Sectors

In 1978, China had only the public-ownership economy, state-owned enterprises making up 77.6 percent and collectively owned enterprises, 22.4 percent. The policy of reform and opening-up has given extensive scope to the common development of various economic sectors. The individual and privately owned industrial enterprises and enterprises with foreign, Hong Kong, Macao or Taiwan investments have mushroomed.

The reform of state-owned enterprises has always been the key link of China's economic restructuring. The Chinese government has made various experiments, trying every means to solve the problem of long-term, extensive losses incurred by state-owned enterprises. By 2003, some 80 percent of the 4,371 key enterprises in China had undergone reform and adopted the company system, and over 90 percent of the medium- and small-sized enterprises had reformed their systems. After being reorganized into joint stock companies, the economic profit of the state-owned enterprises increased steadily and their overall strength and quality were remarkably improved, gaining continuously in their control, influence and lead in the whole national economy.

In 2003, of the total added value of the state-owned enterprises as well as non-state-owned enterprises which have an annual sales volume of five million yuan or above, the state-owned and state stock holding enterprises took up 47.3 percent; collectively owned enterprises, 6.8 percent; and the rest were taken up by other non-public sectors including enterprises with foreign, Hong Kong, Macao or Taiwan investments, and individual and privately owned enterprises, forming a dynamic situation of the co-existence of diversified economic elements.

In 2003, the State-owned Assets Supervision and Administration of the State Council gave approval to 48 state-owned enterprises to transfer part of their property rights and stock rights which involved some 22.5 billion yuan of the state-owned assets and their rights.

The 10th Five-Year Plan

Strategically, China adopts the "five-year-plan" scheme for its economic development. The 10th Five-Year-Plan starting in 2001 gives China the first blueprint for the new century with main targets for economic and social development as follows:

— Maintaining a fairly rapid growth rate of the national economy, achieving noticeable success in the strategic restructuring of the economy, and making marked improvements in the quality and benefits of economic growth, laying a solid foundation for doubling the 2000 GDP by 2010; making significant progress in establishing a modern enterprise system in state-owned enterprises, improving the social security system and the socialist market economy and taking part in international economic cooperation and competition more extensively and deeply.

— The average annual economic growth rate will be about seven percent. By 2005, the GDP will reach about 12,500 billion yuan, calculated at the prices of 2000, and the GDP per capita will be 9,400 yuan. In the coming five years, the number of urban employees will increase by 40 million, and the number of surplus rural laborers to be transferred will also be 40 million. The registered urban unemployment rate will be controlled at about five percent; the price level as a whole will be basically stable; and the international revenue and expenditure will be basically balanced.

—The industrial structure will be optimized and upgraded, and China's international competitiveness will be strengthened. In 2005, the value increases of the primary, secondary and tertiary industries will be 13 percent, 51 percent and 36 percent of the GDP, respectively; their employees will account for 44 percent, 23 percent and 33 percent, respectively, of the total employees; the national economy and the social IT level will be remarkably improved; the infrastructure facilities will be further consummated; the development disparity between regions will be put under effective control; and the urbanization level will be raised.

— In 2005, the proportion of the research and development funds of the entire society in the GDP will increase to more than 1.5 percent; sci-tech innovation capabilities will be strengthened, and technological progress will be speeded up; the gross enrolment rate of junior high schools will be over 90 percent; and that of senior high schools and higher education, about 60 percent and 15 percent, respectively.

— The natural population growth rate will be less than nine per thousand, and in 2005 China's total population will be no more than 1.33 billion. The forest coverage will be raised to 18.2 percent, and the urban green rate, to 35 percent; the total amount of major urban and rural pollutants discharged will be reduced by 10 percent as compared with that of 2000; and remarkable achievements will be made in the saving and protection of natural resources.

— The average annual growth rate of the disposable income per urban resident and that of the net income per rural resident will both be about five percent; in 2005, the floor space of housing per urban resident will be increased to 22 sq m, and 40 percent of the total households in China will have cable TV; medical and health services in both urban and rural areas will be further improved; and the people's cultural life will be richer and more varied.

2006-09-18T03:39:00.000-07:00

The Global Debt Problem

Poor countries owe a vast amount of money to rich nations and international financial institutions like the World Bank and the International Monetary Fund (IMF).

For developing countries as a whole this debt is over $2 trillion. Most of this is owed by "middle-income" developing countries. But some of the lowest-income countries in the world also are heavily indebted, owing around $250 billion.

Ordinary people did not benefit from many of the loans that gave rise to this debt. Yet they bear the principal burden of repayment. Without major debt reduction, poor countries are trapped, making unending interest payments on their debts. This requires them continuously to divert large amounts of scarce resources from health care, education and food security. The debt burden inhibits the social and economic development that is needed to lift people out of poverty.

The Origin of the Debt

The 1973 OPEC oil price hike earned the OPEC (major oil-producing) countries more money than they could absorb, so they deposited it in commercial banks in Europe, the United States and Japan. These banks had to earn enough interest to attract the OPEC depositors; so they lent to developing countries who had to pay high oil bills, and who wanted to maintain their rates of economic growth. Governments borrowed because interest rates were relatively low and the banks put few conditions on their loans. Banks thought countries were secure risks since the economies were growing, and their belief was firm that countries could not go bankrupt.

The 1973 oil price hike triggered inflation in the United States and other northern countries. When the second oil price hike of 1979 occurred, the U.S. Federal Reserve Board raised interest rates very high to halt inflation. International interest rates skyrocketed as well. In reducing inflation, the northern economies went into severe recession. As a result they purchased fewer products from southern producers. The southern economies became desperate: how could they pay higher interest rates when they could not earn more by selling their products to the northern markets?

The problem was compounded especially in Africa because, during the Cold War, donor governments were more interested in gaining allies than in whether the governments served the people or the money went to productive purposes. Newly independent African nations were led by inexperienced governments. Many projects financed by donors were poorly designed and unproductive: roads that went nowhere, factories that never produced, and power plants that were left uncompleted. This misspending left nothing behind except debt with no productive capacity to pay for the projects. In addition, some leaders wasted money on military expenditures and personal corruption.

Because of inadequate resources to reduce poor country debt, governments built up huge arrears. They paid a portion of their debt obligations, especially to the IMF and the multilateral institutions; what was not paid was added to the still unpaid principal of the debt. The size of the debt ballooned.

As Oxfam International states in its April 1997 report, Poor Country Debt Relief, "Debt repayments have meant health centers without drugs and trained staff, schools without basic teaching equipment, and the collapse of agricultural extension services. . . poor communities [are] forced to fill the financing gap left by withdrawal of public investment. . . [For] many millions of families in poor villages and urban slums, the daily consequence is that they are unable to maintain health and nutritional standards, and unable to keep their children in school." Malnutrition and child mortality rates are increasing in some countries. In others an entire generation of children is losing the opportunity to get an education or learn a trade.

The obligation to meet debt service payments also means that aid from other countries like the United States is often used to refinance debt payments rather than for improving health care, education and other social services. In addition, the total debt burden discourages foreign investment, which many believe is necessary to stimulate growth.

The need of highly indebted countries to earn "hard" currency like U.S. dollars to make debt service payments is one reason why some countries have been shifting resources from the production of basic foods for domestic consumption to cash crops for export. This has sometimes helped a country generate more income, with the hope the benefits will "trickle down" to everyone. Indeed, some farmers are able to start growing the new crops and take advantage of the export economy. Their incomes have increased. Many small peasant farmers, however, lose their farms. They are unable to get technical help and credit to make the transition to production for export. They cannot afford seeds and fertilizer or compete against cheap food imports. Larger farms buy or force them out.

Impact of Debt upon the Environment

Inadequate domestic production and the dependence on food imports can also result in local food shortages and higher prices that increase food insecurity for many people living in poverty. In addition, when many countries try to export the same products, their prices fall. Producers and workers in poor countries earn less.

International debts have to be paid back in the creditors' currencies or so-called "hard currencies" like U.S. dollars. One easy -- though not lasting -- way to gain more foreign currency for debt repayments has been to mine the earth's resources for the hard cash they generate. As a result, countries have heavily overused soil to grow cash crops. Farmers are under pressure to produce more crops on small areas of land. They often apply heavy doses of expensive chemical fertilizers that degrade the soil. Vital natural resources are depleted. Fish stocks are damaged through overfishing. Forests often are cut down by national or multinational companies, displacing local people.

Mineral resources are exploited by mining companies that often dump toxic tailings in local water supplies, destroying nearby lands in the process.

Environmental management becomes a low priority, with the result that businesses can pollute the environment and not worry about being prosecuted.

Deforestation accelerates beyond the limits set by the state. Illegal dumping of pollutants into the air and rivers increases. And endangered or threatened species continue to be exploited.

The shrinking government budget has another more indirect impact on the environment. As fewer resources are directed toward poverty reduction, people living in poverty try to survive by cutting down trees to build makeshift homes and provide heat for their families. As they are forced off farmland by large landowners, they turn to marginal lands to subsist. This leads to deforestation, soil erosion, and soil infertility.

Debt Relief Programs

The prevailing philosophy adopted by economists of the creditor nations, international financial institutions and the IMF, has been that "free market" economic reforms, reduced government economic involvement and creditor nation regulation are the best medicine for indebted ailing economies.

Designed by the World Bank and International Monetary Fund (IMF), Structural Adjustment Programs (SAPs) are implemented by debtor countries in order to qualify for debt relief and new loans, as well as to attract foreign investment. The debt crisis of 1982 made SAPs practically synonymous with lending from institutions like the World Bank and IMF. Virtually any country that wants low-interest loans or debt rescheduling must implement a Structural Adjustment Program.

Such reforms seek firstly to stabilise the negative economic trends such as inflation, trade imbalances and budget deficits, and secondly to adjust the economy by altering the nature of production and increasing export earnings. However such programs generally lead to devaluation of the national currency; raising interest rates and decreasing the availability of credit; reducing government spending and increasing taxes (especially sales taxes) in order to balance the budget; lowering tariffs and dismantling trade and investment regulations; privatising public enterprises, which are sold to domestic and foreign investors; reducing real wages; and shifting agricultural and industrial production from food staples and basic goods for domestic use to commodities for export.

SAPs have sometimes succeeded in improving government balance sheets, by shrinking budget deficits, eliminating hyperinflation, and maintaining debt-payment schedules. However, the types of structural adjustment measures that the World Bank and IMF require too often fail to promote a sustainable economy. Instead they have frequently led to increased income inequality and poverty, social disruption, and environmental degradation.

At last, at the September 1996 Annual Meeting of the World Bank and International Monetary Fund (IMF), the Heavily Indebted Poor Country (HIPC) Initiative was launched by creditor nations and the multilateral development banks. It was a groundbreaking agreement. The World Bank and IMF finally recognized debt as a serious problem for the poorest countries. HIPC represents the first effort to coordinate all creditors (governments, private banks, and international financial institutions, like the World Bank and the IMF). Consideration for the first time was placed upon the need to reduce (not just refinance) debt, reduce debtor burden to sustainable levels, and the need for poverty reduction.

Lack of political will on the part of creditors has led however to serious problems in HIPC's implementation. Its implementation has been more with a view to minimizing the costs to creditors than to maximizing the benefits for debtors.

The G7 June 1999 Debt Relief Initiative

Following the dramatic escalation of the third world debt problem in the 90's and the seeming ineffectiveness of relief programs, civil society launched a massive campaign called the Jubilee 2000, aiming for the cancellation of unpayable debts of the world's poorest countries by the end of the year 2000. Pressure was placed upon member nations of G7, the seven richest nations, to completely cancel poor nation debt, when they met in June 1999. Because they collectively control about half the assets of the IMF and World Bank, they play a key role in influencing the economic and debt policies of these two international financial institutions. Though an agreement emerged with some positive steps forward, the G7 failed to grasp this historic opportunity.

The G7 governments promised to cancel the debts of 33 impoverished nations. This compares with at least 50 countries in Africa, Latin America and Asia burdened by high levels of human need and environmental distress.

The G7 Initiative is problematic because it strengthens the role of the International Monetary Fund in poverty alleviation, an area in which the IMF has neither a positive track record nor significant expertise.

The G7 Initiative fails to break the linkage between debt relief and the imposition of austerity policies that perpetuate or deepen poverty or environmental degradation.

While the call to cancel all bilateral concessional debt is welcome, most donor countries have already done so. Canceling market rate loans is a modest but still inadequate improvement. The approximately $100 billion total of old and new offers of debt cancellation almost exactly matches the estimated $100 billion in HIPC country debt that is currently not being serviced (paid). In effect, the G7 are offering to cancel what poor countries are currently unable to pay. Except for a few countries, no new resources would be freed up to be redirected to reduce poverty or provide basic social services.

The Initiative proposes contingent debt reduction, where the creditors forgive a portion of the debt only as long as the debtor country meets certain macro-economic and poverty targets. This is a step backwards from the current HIPC which at least has the merit of canceling debt outright without further conditions once a country finishes jumping through its long series of hoops. This proposed "floating completion point" will maintain creditor control over debtors for a longer period of time (what the US Treasury refers to as "leverage" to ensure the country adheres to its "reform" policies).

The G7 also proposed lowering the debt-to-government-revenue ratio from 280% to 250% for countries that qualify. Countries could qualify if their exports are more than 30% of Gross Domestic Product (GDP) (previously 40%) and government revenue more than 15% of GDP (previously 20%). The G7 partially recognized that governments must rely primarily on their own revenues, not the country's export earnings, to service the debt. But the proposed new ratios are still based on political calculations, not the needs of the debtor countries and their citizens, and are still too high for many of the world's poorest countries. The amount of debt a government can afford to service should be calculated only after the basic needs of its people have been met. This is the principle adhered to in domestic bankruptcy procedures; it places the

survival of the debtor before the repayment demands of creditors. Despite statements affirming the need for sustainable development, the G7 continue to define the need for and amount of debt cancellation primarily in terms of "debt sustainability" as defined by creditors only, rather than on sustainable development criteria.

On the relationship between debt reduction and poverty eradication, the Initiative is at best ambiguous and possibly a step backwards. Every debt campaign has argued for debt cancellation for poorest countries as an essential first step toward poverty eradication. The G7 took this theme and gave it an unwelcome twist, instructing the IMF and World Bank to help poor country governments develop poverty-reduction plans. This looks like paternalism. Many groups question the more central role proposed for the IMF in designing poverty reduction plans, since it has a largely negative track record on ensuring sustainable development.

Jubilee South, in a 19 June 1999 Press Release, said in response, "Jubilee South rejects the Koln debt initiative as a cruel hoax...For moral reasons, the debt of the South is illegitimate. Furthermore, it has been paid over and over again. ... We demand total, unconditional cancellation of all the debt of the South." CAFOD-UK (Catholic Church overseas development agency for UK) said, "(the Initiative) just isn't enough to make a major impact. Although it appears a lot on paper, in reality it will leave many countries still pending more on debt servicing than on health and education of their children"

Future Safeguards

Most inter-governmental loans have in the past taken place in secret, often for dubious purposes; all future international loans need to become totally open and transparent, as a mandatory requirement. Creditors need to become accountable and responsible for bad lending decisions. There is need for an international bankruptcy law, whereby unpayable debt in the future is acknowledged and written off. IMF and the World Bank need to release all regulatory demands. Controls need to be established to regulate future international lending, both by governments and by international financial institutions. There needs to be introduced taxes upon short-term and speculative lending. Loans to the poorest nations need to be governed by a Southern government coalition working together with civil society, in a way that aims for transparency, exposure of corruption, long-term economic and environmental sustainability and poverty alleviation.

The goal of major creditor countries and the IMF, has in the past focused upon ensuring debt sustainability targets; this policy needs to be reversed to ensure sustainable development. The real answer is to find ways, through participatory processes, to ensure that the resources newly available from debt relief are used for poverty reduction and other socially useful expenditures. Sound economic and social policies are vital; but these policies must be crafted with broad public participation and must protect the most vulnerable. Debt cancellation should be implemented in ways that widely benefit ordinary people and not just economic elites, corrupt public officials and military establishments. Unconditional debt cancellation is an essential beginning, but it is just one of many measures necessary to reverse the global problem of poor nation debt.

(This chapter has been prepared and edited from research material available on the website for Jubilee 2000/USA. Anyone desiring more extensive information and news on unfolding developments is recommended to link into this most informative site. Website: http://www.j2000usa.org/j2000) -- David Keane, "The Global Debt Problem," being section 42 of a book he is writing, 17 October 1999.

The Global Debt Problem

Poor countries owe a vast amount of money to rich nations and international financial institutions like the World Bank and the International Monetary Fund (IMF).

The Origin of the Debt

Impact of Debt upon the Environment

Mineral resources are exploited by mining companies that often dump toxic tailings in local water supplies, destroying nearby lands in the process.

Environmental management becomes a low priority, with the result that businesses can pollute the environment and not worry about being prosecuted.

Deforestation accelerates beyond the limits set by the state. Illegal dumping of pollutants into the air and rivers increases. And endangered or threatened species continue to be exploited.

Debt Relief Programs

The G7 June 1999 Debt Relief Initiative

The G7 Initiative fails to break the linkage between debt relief and the imposition of austerity policies that perpetuate or deepen poverty or environmental degradation.

Future Safeguards

Development goals

Useful websites :

Global Learning Outreach http://www.glo.org/article977.html

The World Bank has produced a very user friendly online report on development goals at the beginning of the millenium. Included are numerous graphs laying out scenarios such as: The Millennium Development Goals call for reducing the proportion of people living on less than $1 a day to half the 1990 level by 2015-from 29 percent of all people in low and middle income economies to 14.5 percent. If achieved, this would reduce the number of people living in extreme poverty to 890 million or to 750 million if growth stays on track. And while poverty would not be eradicated, that would bring us much closer to the day when we can say that all the world's people have at least the bare minimum to eat and clothe themselves.

Read the report at: http://worldbank.org.

UNDP http://www.undp.org/mdg/ The global challenge: Goals and targets

The Millennium Development Goals are an ambitious agenda for reducing poverty and improving lives that world leaders agreed on at the Millennium Summit in September 2000. For each goal one or more targets have been set, most for 2015, using 1990 as a benchmark:

1. Eradicate extreme poverty and hunger

Target for 2015: Halve the proportion of people living on less than a dollar a day and those who suffer from hunger.

More than a billion people still live on less than US$1 a day: sub-Saharan Africa, Latin America and the Caribbean, and parts of Europe and Central Asia are falling short of the poverty target.

2. Achieve universal primary education

Target for 2015: Ensure that all boys and girls complete primary school.

As many as 113 million children do not attend school, but the target is within reach. India, for example, should have 95 percent of its children in school by 2005.

3. Promote gender equality and empower women

Targets for 2005 and 2015: Eliminate gender disparities in primary and secondary education preferably by 2005, and at all levels by 2015.

Two-thirds of illiterates are women, and the rate of employment among women is two-thirds that of men. The proportion of seats in parliaments held by women is increasing, reaching about one third in Argentina, Mozambique and South Africa.

4. Reduce child mortality

Target for 2015: Reduce by two thirds the mortality rate among children under five

Every year nearly 11 million young children die before their fifth birthday, mainly from preventable illnesses, but that number is down from 15 million in 1980.

5. Improve maternal health

Target for 2015: Reduce by three-quarters the ratio of women dying in childbirth.

In the developing world, the risk of dying in childbirth is one in 48, but virtually all countries now have safe motherhood programmes.

6. Combat HIV/AIDS, malaria and other diseases

Target for 2015: Halt and begin to reverse the spread of HIV/AIDS and the incidence of malaria and other major diseases.

Forty million people are living with HIV, including five million newly infected in 2001. Countries like Brazil, Senegal, Thailand and Uganda have shown that the spread of HIV can be stemmed.

7. Ensure environmental sustainability

Targets:

• Integrate the principles of sustainable development into country policies and programmes and reverse the loss of environmental resources.

• By 2015, reduce by half the proportion of people without access to safe drinking water.

• By 2020 achieve significant improvement in the lives of at least 100 million slum dwellers.

More than one billion people lack access to safe drinking water and more than two billion lack sanitation. During the 1990s, however, nearly one billion people gained access to safe water and the same number to sanitation.

8. Develop a global partnership for development

Targets:

• Develop further an open trading and financial system that includes a commitment to good governance, development and poverty reduction – nationally and internationally

• Address the least developed countries’ special needs, and the special needs of landlocked and small island developing States

• Deal comprehensively with developing countries’ debt problems

• Develop decent and productive work for youth

• In cooperation with pharmaceutical companies, provide access to affordable essential drugs in developing countries

• In cooperation with the private sector, make available the benefits of new technologies – especially information and communications technologies.

Many developing countries spend more on debt service than on social services. New aid commitments made in the first half of 2002 could mean an additional $12 billion per year by 2006.

The Commission on Sustainable Development http://www.un.org/esa/sustdev/csd/csd.htm

In 1992, more than 100 heads of state met in Rio de Janeiro, Brazil for the United Nations Conference on Environment and Development (UNCED). The Earth Summit, as UNCED was also known, was convened to address urgent problems of environmental protection and socio-economic development. The assembled leaders signed the Framework Convention on Climate Change and the Convention on Biological Diversity; endorsed the Rio Declaration and the Forest Principles; and adopted Agenda 21, a 300-page plan for achieving sustainable development in the 21st century. The United Nations Commission on Sustainable Development (CSD) was created in December 1992 to ensure effective follow-up of UNCED; to monitor and report on implementation of the Earth Summit agreements at the local, national, regional and international levels. The CSD is a functional commission of the UN Economic and Social Council (ECOSOC), with 53 members. A five-year review of Earth Summit progress took place in 1997 by the United Nations General Assembly meeting in special session, followed in 2002 by a ten-year review by the World Summit on Sustainable Development.

Earth Summit + 5: The Special Session of the General Assembly held in June 1997 adopted a comprehensive document entitled Programme for the Further Implementation of Agenda 21 prepared by the Commission on Sustainable Development. It also adopted the programme of work of the Commission for 1998-2002.

The 10^th session of the CSD in 2001 acted as the Preparatory Committee (PrepCom) for the 10-year review process of Agenda 21. A total of four PrepComs, including a last one at a Ministerial level, held in Bali, Indonesia, paved the way to the World Summit on Sustainable Development (WSSD) held in Johannesburg, South Africa, 26 August-4 September 2002. Over 22,000 people attended the Summit, including 100 heads of State and Government. Around 10,000 delegates, 8,000 representatives of Major Groups and 4,000 media were accredited to the Summit in Johannesburg.

The Summit reiterated the initial mandate and functions of the CSD as a high level forum on sustainable development, and deliberated to enhance its role so that it can respond to the new demands emerged from the WSSD Plan of Implementation.

At the 11^th Session of the CSD (CSD-11, held in New York from 28 April-9 May 2003), decisions were made on the Commission's future programme and organization of work. It was agreed that the CSD's multi-year programme of work beyond 2003 would be organized on the basis of seven two-year cycles, with each cycle focusing on selected thematic clusters of issues.

Terminology

1950: 1^st/2^nd/3^rd World (Capitalist/Communist/Non-aligned)

1960-1970: Developed/Less-developed

1980: North/south Division

1990:

MEDC More Economically Developed Countries

LEDC Less Economically Developed Countries

NIC Newly Industrialised Countries

Oil Rich Countries

Defining Development

What do you understand by the term ‘development’?

Up to the 1970s development was taken to mean ‘economic development’. (Why? Explain with reference to Nurske). Therefore the focus was on industrialisation as illustrated by Rostow’s Stages of Economic Growth, published in 1960 (it as titled; a non-communist manifesto).
In 1980, this process of development was critised as it was seen to have increased the global division into a North/South divide with a concentration of wealth in the core, leading to a growth in the level of inequalities and dependency. (Why? Myrdal’s model is a starting point).
The concept of development changed and became focused upon the meeting of basic needs as represented by the Human Development Index. This has been expanded to include the protection of Human Rights.
Due to the increased level of environment destruction the Brandtland Commission develop the concept of sustainable development in 1987, which was incorporated into Agenda 21 at the 1992 Rio Conference, as Meeting the needs of the present generation whilst leaving the same or an improved resource base as a bequest for the Future.

2006-09-05T14:14:00.000-07:00

Geography on a global Scale
The programme to be followed by the OIB is that of the Te L, ES (BO Feb 7-11 2004) which, according to the French ministry, is subdivided into three parts to facilitate a study of geographical regions and processes on different scales. The aim is to provide the students with an appreciation of socio-economic (geographical) divisions on a global scale and the processes by which they are linked. The three parts being:
A Globalised world The three major global areas of economic power The worlds in the path of development
Two text books “l`espace modial” (Jalta, Joly, Reineri, 2004, Magnard and Knafou, 2004 Belin) propose the following structure (including teaching time) and examples.
1. A Globalised world (10h): A. Globalisation and interdependence Questions: Globalisation, a new organisation of the world? Is globalisation responsible for economic decline? (case study Argentina) Can globalisation be the road for development (case study Ireland) How does migration reflect the globalisation process?
i) Definition/ History
ii) Manifestation: Global exchange Migration of people Movement of commodities Movement of capital Connections: Maritime/ aerial/ telecommunications Cultural Exchange
iii) Actors Nation States Global organisations: UN, IMF, World Bank, WTO Transnationals Trading Blocs Non-governmental Organisations
iv) Location Triad Global cities Privileged sites
Case studies: EU, major pole of global economy EU, major global agricultural power London, global city Rotterdam, the first European maritime port

B) Counter-globalisation Question: The world, between uniformisation and diversification Cultural Diversity/Alternatives Regional Trading Blocs Regional and global instability Counter-globalisation movement Environmental threats

2)The three major global areas of economic power (22hours)
a) The United States: A global superpower Questions: USA, the only superpower?
i) Characteristics Military Economic: Production of goods and services/ financial/ trans-nationals Soft Power: Culture Brain Drain Structural: Global/ regional organisations
Problems Economic weaknesses Dependence Inequalities
ii) Internal Organisation Question: Growth poles/ centres of innovation Communication structure Migration patterns Case studies : California Innovation as the origin of a new geography of industry
The Atlantic Seaboard Interface between USA and the world Case studies: N.E USA « Main Street America » Megalopolis: New York

b) East Asia: Region of economic expansion
Questions: To what extent does Shanghai represent the renewed Asia? To what extent has the Chinese dispora lead to the harmonisation of Asia?
Economic characteristics: GNP; HDI; Economic Growth; Trade Conditions and characteristics of development Role of Japanese model Asian Crisis
Case studies Coastal China: Workshop of the world Singapore: first of major Asian ‘hubs’. Japanese megalopolis: characteristics and problems
c) European Union
Questions: What is the global strategy of the European car industry? Is Slovakia a European Tiger?
Trade Migration Multipoles Core/periphery Role of the EU in the world
Case study: Rhinelands

3) The worlds in the path of development (18 hours)
a) Inequalities of Development Question One or more souths? Has globalisation lead to the marginalisation of Africa? Sao Paulo, is it typical of LEDC urban development? Is globalisation responsible for the development of inequalities? Do illegal activities benefit from globalisation?
i) North/South Divide History Indices Unity or diversity
ii) Development Strategies Development theories One or More Souths? Sustainable development Case study: One or more Brazils? Aids, the plague of the South

Case studies: Relationship between development and the environment Inequality of development and global agricultural trade b) Mediterranean: North/South Interface Q: Is the Mediterranean a barrier or an area of exchange? Jerusalem, is it typical of the cultural differences in the Mediterranean?
Divergence/ Convergence through Exchange Inequalities Exchange : Goods ; Capital ; Migration ; Tourism Political alliances/ common concerns Politics of development
Case study : Souse, a tourist area.
c) Russia: An area of re-composition
Q: Does the recent transformation of Moscow reflect developments in the whole country? Tchetchnia: Does the war illustrate the limits of democratic construction in Russia? Why is Russia no longer a superpower?
Economic redevelopment Demographic crisis/ social inequalities Political system Transport system Regional inequalities

Aim

To cover the programme.

Prepare you for the exam.

To develop your work, research, communication and reasoning skills.

To stimulate your awareness and understanding of the world around you.

Exam

a) Four hour written exam including:

2 geography questions (one essay, one document)

2 history questions (one essay, one document)

The candidate is to answer tow questions; one history the other geography.

b) 15 minute oral on one of 10 presented subjects (5 history and 5 geography)

Globalisation

“The idea of tolerance and mutual concession is based on admitting the compatibility of many different philosophical views of the world.” Hajime Nakamura (1964)

Time-space convergence is an integral part of our changing world. Consider:

In 1850 undersea communication cables were laid around the world.

In that year, an American built clipper ship , the Oriental, made a record journey from Hong Kong to London in 97 days.

In 1935, a freighter from Los Angeles took 19 days to reach Tokyo.

Today day there are more than 170 million internet hosts and an email can be sent across the globe in seconds.

A New Global Order is evolving lead by the spread of capitalism. The decline in communism has lead to experiments in the privatisation of ownership and entrepreneurial profit-making. Globalisation is the increasing linkage between countries and global, capitalist enterprises and economic systems. It has many dimensions:

a) Change in one aspect has a ripple effect throughout all the others.

b) The bulk of world business is conducted by multinational or transnational enterprises controlling financial, manufacturing and distribution systems.

c) Foreign aid is dispensed more by international organisations than by individual countries either by transnational organisations such as the IMF or by non-governmental organisations (Oxfam).

It is important to acknowledge that globalisation is only part of the picture. The counter movement is regionalism. Regional organisations are concerned with such things as defence, cultural, environmental and economic issues. Although globalism and regionalism appear contradictory they are integrated phenomena operating at varying scales and settings. Regional trading blocs such as the European Union or the North American Free Trade Association regulate economic interchange in the interests of reducing foreign competition.

Geographer Harm de Blij (1997) recognises that geographical realms have three sets of spatial criteria:

Physical and cultural characteristics are the largest units into which the can be divided the ecumene (the inhabited world).
They are found on the similarity of functional interactions between people and their natural environment.
Focus on and incorporate the world's largest population centres.

When studying geography it is necessary to be aware of Space.

To study, observe, measure, quantify, recognise: what makes a place unique.

To be aware of scale and how interactions change with scale.

To acknowledged the historical setting of place.

To realise that process through time will lead to change.

To understand that culture defines space.

To appreciate that theoretical models have been created to highlight the consequence of process on space.

Hence:

It is necessary to know case studies.

To be aware of models such as: Myrdal, Friedman, Malthus, Demographic transition model.

To appreciate the role of organisations such as IMF, World Bank, Gatt, trading blocs, multinationals.

Question

Discuss with reference to examples the statement made by Philippe Legrain(2002) [in his book: Open World The truth about globalisation] that 'globalisation is the only route out of poverty'.

Consider these two quotes:

“Rather than the rising tide of the market lifting all boats, structural adjustment and liberalisation policies with no concomitant obligations on redistribution appear to have sunk some social groups, especially the poor and the vulnerable.” Noreena Hertz, The Silent Takeover

“ My concern is not that there are too many sweatshops but that there are too few.... those are precisely the jobs that were the stepping stones for Singapore and Hong Kong and those are the jobs that have to come to Africa to get them out of backbreaking rural poverty.” Jeffrey Sachs, professor at Harvard University.