Chinas ongoing emergence as an economic powerhouse.

THE EFFECT OF CHINA AS A POWER HOUSE ON U .S . ECONOMY

Analysts have described the rise of China as a poor , stagnant country to an economic powerhouse as the greatest economic growth of this modern time . Studies show that , from 1979 when the first economic reform was made to 2006 , China 's economy has increased by over 11 folds . Its gross domestic products grew at an annual rate (GDP ) of 9 .6 percent and its real per capita GDP grew to over eight folds . Its world trade ranking rose from 27th to

3rd and its is projected to be the first in the next decade

Because of this rise , the business relationship between the U .S and China has grown over the recent decades . The U .S .-China economic relationship rose from 4 .3 billion in 1983 to 343 billion in 2006 . For the United States , China has become their second largest trade partner most imports done in the United States come from China and these imports amounts to billions yearly . China is also the fourth largest export market for the U .S . economy and the second largest for its imports . The purchasing power of the U . S . citizens is increased due to the inexpensive imports from China . In addition , many U .S manufacturing firms also have most of their manufacturing done in China . This is to take advantage of the huge Chinese market and the cheap labor force that is available to them

China 's purchases of U .S . Treasury securities have funded federal deficits and helped keep interest rates relatively low . Though despite the perceived threat of China 's economic growth , unites states economy has maintained a full employment rate and robust economic growth

Nevertheless , the rise of China as an economic powerhouse has raised concern among many U .S . policy makers . Their fears include the taking over of China as the world 's largest trade economy in the next few years and the world 's largest economy in the next two decades . Going by this view , it is believed that the rise of China begins the relative fall of U .S . another point of concern is the large business relationship between U .S . and China which is value at about 343 billion . The view projected is that China use unfair trade practices . One of those practices are the supply of low priced products , thereby not encouraging exports from the U .S . the practices put threats to U .S . jobs , wages and living standards The situation tends to worsen when China moves towards improving the quality of products done by them like autos and computers . Some of the recent development is the efforts put forward by China state owned firms to acquire U .S companies and the accumulation of U .S . Treasury securities . Policy makers have expressed concern over chin 's large holdings of U .S . securities and Treasury securities . They believe that China could use it as a political tool against the United States . This I...