Question by scorch: Why is China so rich with foreign reserves if it is considered a developing country?
Where does China get all it’s wealth if the people are so poor?
Best answer:
Answer by Empress Jan
China is hardly a developing country! It is one of the oldest cultures in the world!
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A developing country is one that hasn’t attained certain standards. Depending on who you ask, the standards may include GDP per head (china has 1 billion people), life expectancy/infant mortality (China is vast and in rural areas, health care can be rudimentary)… Bottomline all is not reserves, you need to take into account the number of people in the country and the living standards.
Where China gets its reserves is by tarding with other countries. At this time, labour is relatively cheap and good in China. Therefore many manufacturing industries are in China. China therefore produces much of what everyone consumes. And as long as there are no barriers to trade, this will continue until say the wages in China go up and make their products less attractive to foreigners. Therefore, in a way, you can say that China is growing its reserves precisely ebcause there are many poor people in China who are willing to work hard and are able to do so because of many industries having opened in China.