China in the world's economy
Over the last few years China has become a major player in the world's economy and will likely become even more important in the future. As the second largest economy in the world China was always going to be important however recently they have started to become much more active and have attempted to have an influence on the economy of the world. This is a major change from the way that they have behaved in the past.
Until the late seventies China played virtually no part in the global economy, they were shut off from the rest of the world. However in 1978 they started to allow a limited amount of foreign investment in the country. They also started make reforms to the economy in order to help it grow and to help encourage investment. However it was not until the nineties that China became active in the global economy in any meaningful way. Since then however they have become major players and will soon be the most important economy in the world.
It was during the nineties that China started to become a major player in the global economy. They started entering into trade agreements that allowed them to both import and export products. They also significantly increased the amount of foreign investment that they allowed in the country. Perhaps most importantly China also started to invest in other countries. This has become very clear during the current financial crisis, most western countries are relying on money invested by China to keep their economies afloat.
As China becomes more and more important in the global economy they have started to use the influence that they have. In the past China tended to stay out of foreign matters unless they were directly affected by them. This has started to change now however and the government is now using its financial power to influence the decisions that are made by other governments. In large part this is done on the countries that are located near to China as they have become a regional power although they have also started to extend this further afield. China is now heavily involved in Africa for example as they try to extend their influence to other regions.
One of the reasons that China has been able to have so much influence on the world's economy is the nature of its own economy. It is largely dominated by a small number of very large companies. In almost all cases the government is one of the largest shareholders in these companies. That means they operate as a cooperation between private industry and the government. Since these companies invest heavily in many other countries they have a large influence on the economies of those countries and through them the Chinese government is able to exert influence.