Opinion | Five reasons why China should still be considered a developing country

Introduction

However, the United States does not want to recognise China’s status as a developing country. In 2019, the Trump administration published a memo on developing-country status in the World Trade Organization (WTO). “Since joining the WTO in 2001, China has continued to insist that it is a developing country and thus has the right to avail itself of flexibilities under any new WTO rules,” the memo said. “The United States has never accepted China’s claim to developing-country status, and virtually every current economic indicator belies China’s claim.”

US Senate’s Actions

In 2022, the US Senate voted unanimously in favour of an amendment conditioning the Senate’s ratification of updates to the Montreal Protocol, known as the Kigali Amendment, on taking action to remove China’s designation as a developing nation.

In March 2023, the US House of Representatives passed the PRC Is Not a Developing Country Act, which would require the Department of State to take action to stop China from being classified as a developing country by international organisations. The US Senate Foreign Relations Committee approved a similar bill a few months later.

China’s Status as a Developing Country

It is true that China has become the world’s second-largest economy. At a speech marking the 100th anniversary of the Communist Party, Xi said, “[China has] realised the first centenary goal of building a moderately prosperous society in all respects [and is] marching in confident strides toward the second centenary goal of building China into a great modern socialist country in all respects.”

Reasons for Considering China a Developing Country

1. Major international organisations still regard China as a developing country. The Handbook of Statistics, published by the United Nations Conference on Trade and Development, classifies all countries into developed countries, developing countries and least developed countries. China is categorised as a developing country based on the 2023 statistics.

2. China does not qualify as a high-income country, based on World Bank standards. The World Bank classifies different economies of the world into low-income economies, lower-middle-income economies, upper-middle-income economies and high-income economies based on their gross national income (GNI) per capita.

3. Correlating a country’s economic size with its level of development can be misleading. In 2023, US Representative Young Kim said that, “China is the second-largest economy in the world, accounting for 18.6 per cent of the world economy”, second only to the US. On that basis, she argued that China takes advantage of its developing-country status to apply for development loans from international organisations.

4. Purchasing power parity (PPP) cannot reflect a country’s development level. The World Bank uses PPP to measure the economic size of various countries. According to this methodology, China’s gross domestic product (GDP) in 2022 was US$30.3 trillion, making it the world’s largest economy.

5. China’s overall development level is still below that of the developed countries. Although its major cities such as Beijing, Shanghai, Guangzhou and Shenzhen are quite highly modernised, unbalanced and inadequate development is still evident across the country, especially in western China.

Conclusion

Just four years ago, then Chinese premier Li Keqiang said there were still 600 million people whose average monthly income was only about 1,000 yuan (US$140). Many people in China still face problems when it comes to employment, education, medical care, childcare, elderly care and housing.

China’s economy still faces many challenges, and the Chinese people still need to work hard before it can become a fully developed country. At the same time, China will continue to fulfil its global responsibility as a large developing country and make its contributions to South-South cooperation.