Growing Economies

Growing Economies

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Level: AS Levels, A Level, GCSE – Exam Boards: Edexcel, AQA, OCR, WJEC, IB, Eduqas – Economics Revision Notes

Asia (India and China)

  • There has been a rise of emerging markets such as India and China since WW2, leading to a change in the pattern of trade
  • The manufacturing sector of the UK has declined and lead to manufactured goods being produced in other countries such as China – leading to the industrialisation of China and India
  • India’s share of textiles and clothing fell from 35% in 1995 to 16% in 2005
  • India’s manufacturing sector produce more engineering goods – this has resulted in the UK exporting fewer goods
  • The trade deficit that the US has with China has reduced, addition to China’s trade surplus – this is because of a change from export-led growth to growth fuelled by domestic consumption
  • India and China’s share in agriculture, mining and fuel has fallen, however both countries are important for capital in the Euro area
  • India struggles to sustain food grain production if there is rainfall, due to its poor irrigation system – leading to higher prices
  • There are also inefficiencies in India’s transport, communication and healthcare due to the frequent power cuts & electricity shortages
  • China leads the Asian Infrastructure Investment Bank and funds Asian energy, transport and infrastructure
  • The Chinese Government prioritise Infrastructure Development and this is believed to be one of the reasons for the development gap between China and other emerging economies
  • In 1990s and 2000s, China invested 9% of its GDP into infrastructure, in comparison to other economies which only invested 2%-5%


  • The top recipient of China is Africa – it received 45.7% of China’s foreign aid by the end of 2009
  • Africa’s saving rate is 17%, while other middle income countries have a saving rate of 31%
  • Since Africa have high borrowing costs, it is harder for them to gain funds, reducing capital investment
  • The current population in Africa is 1.1 billion and this is expected to double by 2050, making it harder to reduce poverty and hunger
  • 60% of Africa’s exports consist of mining and primary products


Quick Fire Quiz – Knowledge Check

1. Explain how Asia (China and India) is as a growing economy (8 marks)

2. Explain how Africa is as a growing economy (6 marks)


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