10 Facts About China You Won't Believe (But You Should)
China has recently surpassed Japan to become the world's second largest economy, and many wonder what this could mean for the United States. We compare business as usual in the world's two economic powerhouses. Some of these facts may seem truly unbelievable, but we promise they're all true.
China has been the topic of much conversation lately. Some Americans fear the great dragon of the Orient, while some are optimistic about a strengthening relationship with the U.S. Either way, there's no ignoring this global powerhouse.
Here are 10 interesting facts about China, its economy and its people.
1. China's GDP has multiplied tenfold since 1978. Currently, China has the second largest economy in the world, following the United States. While customers of Chinese exports aren't complaining about this growth, economists have a bevy of issues to take up with China, including currency manipulation, exploitation of labor and environmental pollution.
2. There are twice as many cell phones in China than there are people in the United States. In late August, Reuters reported that there were 794.7 million cell phone subscribers in China, nearly two-and-a-half times the size of the entire U.S. population. Even still, those subscribers make up only 60.8% of the country's total population. China Mobile (NYSE: CHL) is the world's largest cellular service provider, with a total of 558.9 million mobile subscribers.
#-ad_banner-# 3. China is crawling with KFC's. In 2009, Yum! Brands (NYSE:YUM) opened more than 500 new restaurants in mainland China. Yum! Brands is an American company that owns Taco Bell, KFC, Pizza Hut, Long John Silver's, A&W and WingStreet. But in China, KFC has been the big winner -- there are currently close to 3,000 KFC's in mainland China. Yum! claims that it opens nearly one new KFC in mainland China every day.
4. China is the largest foreign holder of U.S. Treasury securities. Currently, Chinese lenders hold over $840 billion worth of U.S. Treasury securities. That is equal to nearly 10% of the total Treasury debt held by the American public. As China ostensibly moves toward a floating exchange rate, they may be forced to unload some of that debt, which could really put the United States into a bind by restricting our debt financing ability.
[China could be changing how it deals with the U.S. dollar. Understanding basic economic theory can help boost even the most diversified portfolio. Read more about how China's policy changes will likely have an impact on every American in this educational article, How Money Manipulation on the Other Side of the World Could Affect American Portfolios.]
5. Nearly a third of Chinese adults live with their parents. But not for a lack of space; according to Bloomberg, urban construction is up more than 16% while rural construction is up almost 14% year-over-year. According to a 2000 world marriage pattern study by the United Nations, the average marrying age is 24 and 22 for men and women, respectively. In Chinese culture, people usually live in their parent's homes until marriage. According to the same study, Americans marry about four years later than Chinese and culturally embrace living alone before then.
6. China is the source of more than 77% of the U.S.'s pirated goods. According to the U.S. Government Accountability Office, China is responsible for 77% of pirated goods seized in the United States, with Hong Kong accountable for another 7%. In a recent Los Angeles crackdown, approximately $12 million of contraband was confiscated, including cigarettes, iPhones and yet-to-be released DVDs.
7. More than 75% of the Chinese population supports the "one-child" policy. Even though its workforce has been able to produce stunning results over the past two decades, the Chinese government seeks to restrict its growth through the so-called one-child policy. This prohibits many Chinese families from having more than one child. Although seemingly despotic, the policy is supported by over 75% of the Chinese population according to a study by the Pew Research Center.
8. More than 135 million people in China live on less than $1 a day. This is extreme poverty and it means families are not able to afford the most basic necessities to ensure survival. Even though China has the world's second largest economy, it is still considered to be a developing country by the World Bank.
9. Only 43% of Chinese Citizens live in cities. More are urbanizing every year. Reuters expects the urban population to have doubled to a whopping 700 million city-dwellers by 2015.in mind, "rural" is not American suburbia. Rural Chinese towns generally lack running water and reliable transportation.
Also, rural towns still rely on the strength of their young boys to pass on the family name and care for the parents when they age. They're so prized, Time Magazine reports, that in some rural populations 80% of kids between ages 5-10 are boys.
10. Starting a business takes 38 days. Capitalism is a touchy new subject in socialist China. Though the central government is slowly releasing its grip as the planner of the economy, it is not yet as encouraging to entrepreneurship as many western nations. To start a business costs 130% of the average worker's income and taxes eat up a whopping 64% of profits.