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Autor: anton • November 16, 2010 • 444 Words (2 Pages) • 547 Views
In this paper, we will discuss how the prices of good, oil and raw material in China have increased so outrageously due to the high demand for commodities. The rapid growth in China has given the economy such a global impact on the world in numerous ways. "China has a great wealth of mineral and natural resources. Reserves of coal, petroleum, iron ore, tungsten, tin, bauxite, copper, limestone, and many other minerals needed in modern industry are abundant. "(China Britannica Student Encyclopedia).
The rapid growth that is occurring in China is straining its infrastructure and overburdening the power grid fizzles. Shanghai and Yantian ports are backed up for days slowing commerce around the globe. Soybean, airplanes are heavily sold in China. China has looked at several ways to prevent the economy from becoming overly congested. But, with China imports increasing 40 percent in 2003, it is difficult for China to slow down its economy by 9.8 percent. China is known as the world's third-largest importer.
In April 2004, many construction companies were hit hard by the shortage of cement and other needed materials to complete ongoing and planned building projects. The shortage of cement and other raw material was due to China large consumption needed to keep up with its growth. China is rapidly growing and requiring more building material than ever before causing prices for raw material to steadily increase. "China consumes 55 percent of the world's cement, 40 percent of its steel and 25 percent of its aluminum. China's growing demand for oil is one reason crude prices are so high." (China drains raw materials, May 2004)
Within the first three months of 2004, real estate prices rose 28.3 percent in Shanghai. For the fifth consecutive year, the national grain production has decreased which include rice, corn and wheat. Oil and grain imports have doubled this year.