China  

Unemployment in China is at 4%, and this, coupled with a relatively low inflation rate of only 5%, inspires reasonable confidence in the economy. Despite the large availability of jobs, the workforce is hindered by a relatively small amount of physical capital, which limits their production capacity. While net interest margins are low at 2.6 percentage points, the percentage of defaulted loans is relatively high at 6.7%, indicating weak vetting of borrowers. Household expenditure as a share of GDP is the fifth highest by international standards, providing a large domestic market for Chinese firms while not compromising the domestic savings rate, which is the third highest globally, at over 53% of GDP. China’s reliance on the export of raw materials is very low and the country also has strong terms of trade, with export revenues being high compared to the cost of imported goods. Foreign direct investment is at around the international average, ranking the country 51st in the Index on this variable.

With 13 requirements for new business set up, China has one of the highest numbers of barriers to entry for entrepreneurs, ranking the country 86th internationally. Despite a top five ranking on internet bandwidth, there are only four secure internet servers per 10 million people, implying very little privacy of information whilst using the internet. There are only 56 personal computers per 1,000 citizens, indicating that the general populace does not have widespread access. At 30%, ICT and high-tech exports are both very high, ranking China in the top 10 on both variables. However, value added in the service industry is amongst the 15 lowest in the Index, implying that China’s comparative advantage may still lie in the industry sector. R&D expenditure is high, ranking the country 18th on this variable, at 1.4% of GDP. Royalty receipts are also amongst the highest in the international community, ranking the country in the top quartile on this variable.

Classified as a near complete autocracy, China performs poorly on all democratic variables. Elections for both the executive and legislative branches of government are uncompetitive with no rival political parties, and all candidates coming from the same political organisation. The government maintains full control of the entire electoral process. There are additionally no political checks or balances in Chinese politics, allowing politicians to take arbitrary actions. As it is not independent, the judiciary is open to interference from other branches of the government. Though highly undemocratic, the political system in China ranks within the top 20 in regards to stability, as the regime has been unchanged for 60 years, ranking comparatively high on this variable.

Levels of primary school enrolment in China are very high, ranking the country in the top 10, internationally, and classes are gender equal and small, with one teacher per 18 students. However, a gross secondary enrolment rate of only 76% places China at 73rd, and tertiary enrolment rates of 22% ranks the country at 69th, internationally, indicating that the Chinese have very good basic levels of education, but that few continue with their studies. The average Chinese worker has had on average 4.8 years of secondary schooling and four years of tertiary schooling, ranking the country in the bottom half of the index on both variables.

China ranks near the global average in terms of availability of medical professionals and hospital beds. Health-adjusted life expectancy is fairly high at 64 years, placing China 42nd on this variable. Povertyrelated health issues all rank below the international average, with 12% of the population undernourished and 21 deaths in infancy per 1,000 live births. While only 65% have access to improved sanitation facilities, 76% claim satisfaction with the quality of their water.* The Chinese ranked below the global average on their health satisfaction, ranking 59th in the Index.* This is in line with one in five reporting debilitating health issues and 15% claiming to have experienced pain for a prolonged period of the day.* Additionally, 78% of the population feels well rested, ranking China the sixth highest in the Index on this variable.*

With only two homicides per 100,000 people, China ranks in the top 30 on this variable. Due to the lack of survey data on personal security, the Index relied on expert estimates, which indicate that approximately 15% of Chinese citizens had property stolen in 2008, ranking 57th, and 4% had been mugged or assaulted, ranking China 40th, internationally. Nevertheless, the estimates also indicated that a comparatively high 88% of people feel safe walking alone at night, ranking China in the top five countries in the international community. Domestic security is more of a problem, due to challenges related to the movement of refugees and targeted violence towards social groups with a history of discrimination. Problems caused by human flight are much less severe, ranking the country just inside the bottom half of the Index. However, government-sponsored violence and political imprisonment are very present threats to Chinese citizens, placing the country in the bottom five with reference to this variable.

The law in China is sometimes enforced arbitrarily, and with varying quality, ranking the country rank below the international average at 63rd. The government is sometimes inefficient when enforcing legislation, placing China 50th for government effectiveness and China ranks below the global average in terms of the quality of regulation. In China the right to self determination through free and fair elections does not exist. Due to the lack of survey data on governance, the Index relied on expert estimates, which indicate that only 10% of Chinese have confidence in electoral honesty, ranking the country last on this variable, while the approval rate of the judiciary system remains low at 34%. More than nine out of 10 people believe that corruption is widespread in local government and business, and 68% have confidence in the Chinese military.

Ranking 98th in the Index on the variables for civil liberties, freedoms of speech, movement, and religion are extremely limited in China. However, a large proportion of people reported being satisfied with the choices afforded to them in their daily lives, ranking the country 23rd, internationally.* Data on tolerance towards ethnic minorities and immigrants was unavailable, but according to expert estimates, tolerance is very low, ranking China 96th and 99th, respectively, in the global community.

Most Chinese citizens believe that having friends is only moderately important and 77% believe that they can rely on family and friends in times of need, ranking the country below the global average on both variables. However, the majority of the population believe that others can be trusted, ranking the country sixth on this variable. Despite these high levels of social trust, only 13% of citizens have donated money and a lower 4% have volunteered their time. Additionally, just over one-third of the Chinese population claim to have helped a stranger in the past month, ranking the country 82nd on this variable. Societal group membership is also low in China, ranking the country in the bottom half in this area. Further, China ranks in the bottom five for religious membership, as most people claim that religion is not very important in their lives.

* Data taken from the Gallup World Poll

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