A comparison of China's long and short term economic performance with its own projections

It is interesting to make a comparison of China's actual economic performance with what have been its own long term future projections for this. As I was recently asked to write an article for China Daily, reviewing the more than thirty years of China's economic reform, I went back and reread China's early projections for what targets were set to be achieved.

Interestingly, rather precise projections for growth rates for a 70 year (!) period were given by Deng Xiaoping.¹ These foresaw China achieving 'comparative prosperity' by the beginning of the 21st century, based on a quadrupling of its GDP between 1981 and 2000. China would then become a 'moderately developed' country by the middle of the 21st century century based on a further quadrupling of its GDP in 2000-2050.

These projections are shown in green in the chart below. China's actual economic growth is shown in red. As may be seen China has far outperformed its own economic predictions over the 24 year period since Deng's projection.

The same occurred during the period of the latest five year plan, from 2006-2010. The government targetted 8.0 per cent annual GDP growth during this period. The actual annual average GDP growth achieved was 11.1 per cent.

Some people argue that China's economic performance is exaggerated and/or will come to an end rapidly. The factual record shows the opposite. China's economic targets have been exceeded, in both the long and short term, over a period of more than a quarter of a century.

Figure 1

 

Note

1. Deng Xiaoping's projection was: ‘On the whole, our goals are not too ambitious. We give ourselves 20 years – that is from 1981 to the end of the century – to quadruple our GNP and achieve comparative prosperity... Then we shall take this figure as a new starting point and try to quadruple it again... in another 50 years. What does this mean? It means that by the middle of the next century we hope to reach the level of the moderately developed countries… China has a huge population. If we assume that by the mid-21st century our population will have reached 1.5 billion... that will place China in the front rank of nations.’ (Deng Xiaoping,  26 April 1987 - Selected Works of Deng Xiaoping Vol 3 p221)