China, Politics And International Business

Study programme: SAB 201
Semester: 4
Location: Berkeley College New York
Professor: Vinita Ittoop

Assignment on the topic China, Politics and International Business focused on Urbanization

in International Business

by Martina Gemperlein, Teresa Hofmann, Sophia Pfundstein, Maralen Hirschberger

Table of contents
List of figures ............................................................................................................................... 3
1. Introduction ............................................................................................................................. 4
2. China, politics and international business ............................................................................ 6
2.1. Similarities in other countries ............................................................................................ 6
2.2. The complexity of the issues from various perspectives ................................................... 7
2.3. The consequences to international business management ................................................. 9
2.4. Risks and opportunities to international business operating in China ............................. 10
3. Summary................................................................................................................................ 12
Bibliography .............................................................................................................................. 13

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List of figures

Abb. 1: Degree of urbanization from 2003 to 2013 .......................................................... 4

3

1. Introduction

Figure.1: Degree of urbanization in China from 2003 to 2013
(Source: Statista, [2014])

As can be seen in the graphic the population in urban areas in China has reached over
50 % in the last ten years. This is common in developing countries all over the world.
To describe China´s culture, it is important to take a look at some Facts and Figures.
The People´s Republic of China is an authoritarianism. It modeled oneself on the model of the former Soviet Union. The express rejection of the political power-limitation by the separation of powers between the executive power, legislature and judicial power – and the subordination of individual rights under collective interests are key principles of the constitutional system of the People´s Republic of China until today. The population is exceeding 1.3 billion people, which makes China the most highly populated country in the world. To make this number more tangible, this means that 13.3% of the world population, lives in China. Mandarin is the main spoken language.

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According to the” CIA World Factbook”, 54.4% of the population lives in Urban Areas.
The major Urban Areas are Shanghai, Beijing (which is the country´s capital),
Chongqing, Guangdong, Tianjin and Shenzhen. In 2010 China became the world´s largest exporter. In fact this country has globalized rapidly over two decades. The “postmao” reform had a huge impact on globalization from economically perspectives. The aim was to integrate China into international communities. A huge influence on increasing rural incomes was made by the first reform, the agricultural reform. “As agricultural productivity increased, greater agricultural surplus was available non-farm development”. Townships and village enterprises became a driving force for the economic growth in China. Soon the industrial factor has been reformed too. The restructuring of the foreign-trade-system in the early 1980s was a milestone for the abolition of the monopoly position of state trade corporations for import and export business. Thousands of Chinese enterprises were now allowed to run on international trade. In 2011, as economic growth increased dramatically in coastal regions, more than
250 millions of migrant workers and their dependents resettled to urban areas in order to find work. The recent Hukou system reform is important for the urbanization and

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