United Nations Radio

changes in China's development

China is now the world's second largest producer of manufacturing output, says a new report by UNIDO, the United Nations Industrial Development Organization. But what does that mean? Surveying such manufactured goods as food, textiles and pharmaceuticals, UNIDO found that China's industrial output in the last 20 years has increased almost eight times. In fact, China has overtaken such major industrial economies as Germany, France, Italy and the United Kingdom, and now it is second only to the United States. Shyam Upadhyaya, Chief Statistician of the Research and Statistics Branch of UNIDO, put this all into perspective for UN Radio's Gerry Adams:

Shyam: We must not forget that China inhabits one fifth of the world's population. You know Industry not only produces a commodity but also creates its consumers. It provides the job, drives the technological progress and creates the demand of the qualified and healthy workforce. So, actually there's the progress in social areas such as education and health care.

Narrator: What industries were surveyed?

Shyam: UNIDO refers to the manufacturing sector. It covers all forces in industry such as food, textiles, pharmaceuticals, ICT goods, petrochemicals. There are 23 major sectors and 151 sub-sectors. UNIDO has the mandate from UN Statistics Commission to collect the industries statistics from member States and we produce the International Yearbook of Industrial Statistics. We just released our 2010 edition. We also collect the data from international sources and supplement with our own estimates.

Narrator: Why are developing countries concerned about this story and why is Japan as an industrialized country interested in this story?

Shyam: China's progress is an inspiration as well as a challenge for other major developing economies. This year, India itself entered into the top 10 industrialized manufacturers of the world. India moved from 12th position in 2008 to 9th position in 2009. India has similar challenges to those of China to uplift large populations out of poverty. It can be done only through significant leap forward in rural industry because only industry can observe the large portion of rural population living in poverty. But China is also competitive to India in today's globallzed market economy. It has to find the product of its own competitive advantage.

Narrator: Someone had mentioned to me that the United States owes China a lot of money. How is this going to affect the relationship between China and the US?

Shyam: That is a very good question and I cannot say much on the political front, but China will definitely assert its position in the world as a major economic powerhouse. For many years, China was seen merely as a production site where US manufacturers could make more profit and the products were also sold back to the US consumers. But with the increased size of the economy, well-established industry and infrastructure, China's growth potential has made it stronger than ever. Many in the US think that China can no more claim being just a developing country in international trade and tariff negotiations when it is already the second largest economy in the world.

Narrator: Will China's new status improve the worldwide financial crisis?

Shyam: I think it already did actually. China maintains about nine percent of industrial growth during the entire period of the financial crisis. It contributed to a large extent to preventing the world economic crisis as a consequence of financial crisis. It was mostly the industrialized countries that were hit hard by the financial crisis. The effect of the financial crisis on developing countries was not so severe. We had mentioned it also in our press release so the prosperous and crisis-free China is the second largest economy will keep the ball rolling.

Narrator: Shyam Upadhyaya of the UN Industrial Development Organization, UNIDO, on China becoming the world's second largest industrial manufacturer.

Producer: Gerry Adams
Duration:  3'53"