China Business

Economic environment Until the 1970s China was a closed off agricultural based economy, in the late 1970s China opened up to the world, and since then China has become the largest exporter of goods in the world. China has still maintained some of its agricultural roots by remaining the leading exporter in agricultural goods such as rice, wheat, and tea(CIA Fact Book). China's economy is a fast and rapid growing economy with a GDP of $12.61 trillion in 2012, making it the 3rd highest GDP in the world(CIA fact book). Recent reports from the Organization for Economic Cooperation and Development(OECD) indicate that China will have expanded its economy by 8.5% this year(Bloomberg). In addition to growth this year, projections for 2014 show China increasing their growth even more to 8.9% according to OECD. Even with such a shaky global economy china has been able to capitalize and maintain steady growth and expansion, Chinas growth is nothing new since, 1999 China has experienced growth of at least 7.8%(Bloomberg). One reason for the continued expansion is China's purchasing power, a countries purchasing power is its ability to buy goods and services. currently the United States has the most purchasing power in the world, however China is predicted to surpass the united States in purchasing power by the year 2016(Bloomberg). The largest reason for the continued growth would have to be china's rapid moment towards an exporting power in the world, in 2012 China's exports measured $1.735 trillion which puts them 3rd in the world. With China poised to have the most purchasing power and soon to be the worlds largest exporter China and its economy will not only make up the largest market but become the largest buyer and seller of goods in the world.

Management In order for a western company to begin doing business in the Chinese market the first thing that must be understood is the differences in management styles, these differences often lie in a cultural differences