Minor difference [By Jiao Haiyang/China.org.cn]
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Minor difference [By Jiao Haiyang/China.org.cn] |
The year 2010 marked the beginning of a new era for China, which overtook Japan to become the world's second largest economy, with a per capita GDP of $4,412.
Economic history tells us that a country's economic and social development will take a different course after its per capita GDP exceeds $4,000. If handled well, its economy will enjoy a relatively long period of rapid growth, resulting in higher per capita GDP. If the economy is not managed well, there will be fluctuations, even regression, resulting in the so-called middle-income trap characterized by capital centralization and widening income gaps. This leads to an imbalanced economic structure and sluggish domestic demand.
"It is not scarcity, but the unfair distribution of social wealth that poses the greatest challenge to a state," says an ancient Chinese idiom.
The income disparity and wealth gap in China have become more prominent in recent years. People's incomes and accumulated wealth have improved remarkably during the past three decades, but problems in wealth distribution have also developed.
Latest data shows that the Gini coefficient of China has reached 0.48, far exceeding the alarm level of 0.4. Data from the State Bureau of Statistics (SBS) also shows that in 2007 about 415,000 individuals, or 0.03 percent of the population, had personal assets of more than $1 million. Altogether this group of people grabbed $21.615 trillion, 60.1 percent of the national GDP.
In China, wealth is being accumulated by the rich at a rate that is growing by 12.3 percent a year, twice the global average.