Is China Still a Developing Country?

Graham Kanwit

Whether China is a developing or developed nation has long been a source of debate among researchers and China experts — especially as China has risen to become the world’s second largest economy and a global manufacturing powerhouse.

At the recent summit of the BRICS countries (Brazil, Russia, India, China and South Africa) in Johannesburg, Chinese leader Xi Jinping said “China has been and will always remain a member of [the] developing countries.”

FILE - China's Xi Jinping, 2nd left, is among the leaders attending the BRICS summit in Johannesburg, Aug. 24, 2023.
FILE – China’s Xi Jinping, 2nd left, is among the leaders attending the BRICS summit in Johannesburg, Aug. 24, 2023.

However, in Washington, lawmakers in Congress have introduced legislation requiring the U.S. administration to use its influence in international organizations to strip China of its status as a developing nation.

The debate may sound academic, but it has real-world implications. The benefits that come with the developing nation label include preferential tariff treatment from developed countries, making their exports more competitive in international markets. China also uses its developing status to justify subsidies to industries such as fishing and tech, even when many are effectively state-owned and have global impact.

The development status of a country is determined in different ways by different international organizations. The World Trade Organization, for example, allows countries to self-identify as “developing” or “developed.”

Other international organizations like the World Bank and International Monetary Fund employ a variety of metrics to measure a country’s standard of living, using indicators such as average national income per person, gross national income (GNI) per capita, life expectancy, and education measures.

Weifeng Zhong, a senior research fellow at George Mason’s Mercatus Institute, tells VOA these are different ways of trying to measure the same thing.

“I think it comes down to, on a per capita level — meaning per person — how high the income is, so when the national income per person in a country is high enough, we think of them as developed country rather than developing country,” Zhong said.

How China is classified

Beijing classifies itself as a “developing” country in the WTO. However, the World Bank and U.N. Development Program classify China as an “upper middle income” country, while the IMF calls the country an “emerging and developing economy.”

FILE - A high-speed train traveling to Guangzhou is seen running on Yongdinghe Bridge in Beijing, Dec. 26, 2012.
FILE – A high-speed train traveling to Guangzhou is seen running on Yongdinghe Bridge in Beijing, Dec. 26, 2012.

Analysts say China is unique in ways that make it defy easy classification.

“You have a country that has many of the traits of a developing nation and has historically qualified as one and technically in many ways still qualifies as one, but has also many of the attributes of a rich advanced economy and in some ways a massive rich advanced economy,” Philippe Benoit, director of research at Global Infrastructure Analytics and Sustainability 2050, told VOA.

China also defies classification on another commonly used indicator – energy consumption. “For structural reasons, energy demand, energy use in China is going to increase for a number of years until they achieve a level of development, a level of income per capita that allows them to flatten that,” Benoit said.

China’s burgeoning energy needs have spurred the state to seek resources in poorer developing countries.

But China often behaves like a developed nation internationally, some analysts say. Many developing countries, particularly Latin America, Africa, and Central Asia, rely on China for development assistance and infrastructure funding.

Benoit calls China a “hybrid superpower.” He said its global power projection approximates that of a traditional superpower and it displays developed country traits such as its major investments in tech and high speed rail . It also has highly developed cities such as Beijing and Shanghai.

FILE - People walk past a China Energy coal-fired power plant in Shenyang, Liaoning province, China, Sept. 29, 2021.
FILE – People walk past a China Energy coal-fired power plant in Shenyang, Liaoning province, China, Sept. 29, 2021.

But he adds, China also has developing country traits, such as the persistence of poverty in many areas of the country. In 2019, the International Energy Agency (IEA) found more than 35% of the population in China still lacked clean cooking technology and relied on highly polluting fuels such as coal.

“What we mean when we say developing is a country that faces significant poverty issues — where there’s inadequate access to water, sanitation, transport, education — countries where the standards of living are basically, as a general proposition, unacceptably low,” Benoit said.

Robert Ross, professor of political science at Boston College and associate at the John King Fairbank Center for Chinese Studies at Harvard University, told VOA the developing nation classification no longer matches economic realities given China’s reduction of extreme poverty and its status as the second largest economy and the world’s largest manufacturer.

“Many Chinese people acknowledge ‘it makes no sense to treat us as a developing country,’ and they will acknowledge that it undermines both the interests of the developing world and gives them unfair advantages in the American domestic economy,” Ross said.

US-China relations

The question of China’s development status has added to Washington and Beijing’s strained relationship. In March, the U.S. House of Representatives unanimously passed a bill called the PRC Is Not a Developing Country Act.

On June 8, the U.S. Senate Foreign Relations Committee also approved the bill, now retitled the Ending China’s Developing Nation Status Act. It calls on the State Department to “take actions to stop China from being classified as a developing nation by international organizations.” No date has been set for the full Senate to vote on the bill.

In response to the Foreign Relations Committee’s approval of the act, Wang Wenbin, spokesman for China’s Ministry of Foreign Affairs, accused the U.S. of attempting to sabotage China’s development.

FILE - In this image from video, Chinese Foreign Ministry spokesperson Wang Wenbin gestures as he speaks during a media briefing at the ministry in Beijing, Feb. 13, 2023.
FILE – In this image from video, Chinese Foreign Ministry spokesperson Wang Wenbin gestures as he speaks during a media briefing at the ministry in Beijing, Feb. 13, 2023.

“China’s status as the world’s largest developing country is rooted in facts and international law. It’s not something that can easily be wiped away by a U.S. Congressional bill,” Wenbin said at a June 9 press conference. He added, “It’s not up to the U.S. to decide whether China is a developing country.”

Ross said China’s development status “is not a very important question,” but rather a political issue between two competing superpowers.

“China is resisting American efforts to improve American competitiveness against China, and so with that, the United States has a trade war and a tech war to undermine China’s economic development and its technological development. For China’s part — it’s the part that’s competing with the United States — it’s going to use every instrument available to improve its own position.”

With many developing nations benefiting from Chinese investments and trade, Ross said these countries are unlikely to endorse efforts by the U.S. to change China’s development status, especially since they see this issue as a political war of words between the two superpowers.

(Source: VOA News)