Visualizing China’s $18 Trillion Economy in One Chart
Visualizing China’s $18 Trillion Economy in 2021
China is the world’s second largest economy after the U.S., and it is expected to eventually climb into the number one position in the coming decades.
While China’s economy has had a much rockier start this year due to zero-tolerance COVID-19 lockdowns and supply chain issues, our visualization covers a full year of data for 2021—a year in which most economies recovered after the initial chaos of the pandemic.
In 2021, China’s Gross Domestic Product (GDP) reached ¥114 trillion ($18 trillion in USD), according to the National Bureau of Statistics. The country’s economy outperformed government targets of 6% growth, with the overall economy growing by 8.1%.
Let’s take a look at what powers China’s modern economy.
Breaking Down China’s Economy By Sector
|Sector||2021 Total GDP |
|2021 Total GDP |
|Wholesale and Retail Trades||¥10.5T||$1.7T||9.2%|
|Farming, Forestry, Animal Husbandry, and Fishery||¥8.7T||$1.4T||7.6%|
|Transport, Storage, and Post||¥4.7T||$0.7T||4.1%|
|Information Transmission, Software and IT Services||¥4.4T||$0.7T||3.9%|
|Renting & Leasing Activities and Business Services||¥3.5T||$0.6T||3.1%|
|Accommodation and Restaurants||¥1.8T||$0.3T||1.6%|
Industrial production—activity in the manufacturing, mining, and utilities sectors—is by far the leading driver of China’s economy. In 2021, the sector generated ¥37.3 trillion, or one-third of the country’s total economic activity.
Despite a slowdown in December, wholesale and retail trades also performed strongly in 2021. As the main gauge of consumption, it was affected by lockdown measures and the spread of the COVID-19 Omicron variant towards the end of the year, but still rose by double digits, reaching a total of ¥10.5 trillion*.
“Other services”, which includes everything from scientific research and development to education and social services, generated 16% of China’s total economy in 2021, or ¥18.1 trillion.
*Editor’s note: At time of publishing, China’s government seems to have since adjusted this number to ¥11.0 trillion, which is not consistent with the original data set provided, but worth noting.
Where is China’s GDP Headed?
China’s economy recovered noticeably faster than most major economies last year, and as the overall trend below shows, the country has grown consistently in the years prior.
Before the pandemic hit, China’s quarterly GDP growth had been quite stable at just above 5%.
After the initial onset of COVID-19, the country’s economy faltered, mirroring economies around the globe. But after a strong recovery into 2021, resurging cases caused a new series of crackdowns on the private sector, slowing down GDP growth considerably.
With the slowdown continuing into early 2022, China’s economic horizon still looks uncertain. The lockdown in Shanghai is expected to continue all the way to June 1st, and over recent months there have been hundreds of ships stuck outside of Shanghai’s port as a part of ongoing supply chain challenges.
China’s Zero-COVID Policy: Good or Bad for the Economy?
While every country reacted to the COVID-19 pandemic differently, China adopted a zero-COVID policy of strict lockdowns to control cases and outbreaks.
For most of 2021, the policy didn’t deter GDP growth. Despite some major cities fully or partially locked down to control regional outbreaks, the country’s economy still paced well ahead of many other major economies.
But the policy faced a challenge with the emergence of the Omicron variant. Despite lockdowns and an 88% vaccination rate nationally, seven out of China’s 31 provinces and all of the biggest cities have reported Omicron cases.
And China’s zero-COVID policy has not affected all sectors equally. Industrial production rose by more than 10% in the first 11 months of 2021, despite city lockdowns around the country. That’s because many factories in China are in suburban industrial parks outside the cities, and employees often live nearby.
But many sectors like hotels and restaurants have been more severely affected by city lockdowns. Many global economies are starting to transition to living with COVID, with China remaining as one of the last countries to follow a zero-COVID policy. Does that ensure the country’s economy will continue to slow in 2022, or will China manage to recover and maintain one of the world’s fastest growing economies?
Mapped: The State of Economic Freedom in 2023
How free are people to control their own labor, property, and finances? This map reveals the state of economic freedom globally.
Mapped: The State of Economic Freedom in 2023
The concept of economic freedom serves as a vital framework for evaluating the extent to which individuals and businesses have the freedom to make economic decisions. In countries with low economic freedom, governments exert coercion and constraints on liberties, restricting choice for individuals and businesses, which can ultimately hinder prosperity.
The map above uses the annual Index of Economic Freedom from the Heritage Foundation to showcase the level of economic freedom in every country worldwide on a scale of 0-100, looking at factors like property rights, tax burdens, labor freedom, and so on.
The ranking categorizing scores of 80+ as free economies, 70-79.9 as mostly free, 60-69.9 as moderately free, 50-59.9 as mostly unfree, and 0-49.9 as repressed.
Measuring Economic Freedom
This ranking uses four broad categories with three key indicators each, both qualitative and quantitative, to measure economic freedom.
- Rule of law: property rights, judicial effectiveness, government integrity
- Size of government: tax burdens, fiscal health, government spending
- Regulatory efficiency: labor freedom, monetary freedom, business freedom
- Open markets: financial freedom, trade freedom, investment freedom
The 12 indicators are weighted equally and scored from 0-100. The overall score is then determined from the average of the 12 indicators.
Here’s a closer look at every country’s score:
|#5||🇳🇿 New Zealand||78.9|
|#15||🇰🇷 South Korea||73.7|
|#24||🇦🇪 United Arab Emirates||70.9|
|#25||🇺🇸 United States||70.6|
|#28||🇬🇧 United Kingdom||69.9|
|#45||🇨🇷 Costa Rica||66.5|
|#47||🇨🇻 Cabo Verde||65.8|
|#48||🇧🇳 Brunei Darussalam||65.7|
|#56||🇲🇰 North Macedonia||63.7|
|#59||🇻🇨 Saint Vincent and the Grenadines||63.5|
|#63||🇧🇦 Bosnia and Herzegovina||62.9|
|#65||🇩🇴 Dominican Republic||62.6|
|#66||🇧🇸 The Bahamas||62.6|
|#74||🇸🇹 São Tomé and Príncipe||61.5|
|#79||🇱🇨 Saint Lucia||60.7|
|#81||🇨🇮 Côte d'Ivoire||60.4|
|#88||🇹🇹 Trinidad and Tobago||59.5|
|#98||🇸🇦 Saudi Arabia||58.3|
|#101||🇬🇲 The Gambia||57.9|
|#107||🇸🇧 Solomon Islands||56.9|
|#111||🇧🇫 Burkina Faso||56.2|
|#114||🇸🇻 El Salvador||56.0|
|#116||🇿🇦 South Africa||55.7|
|#136||🇱🇰 Sri Lanka||52.2|
|#140||🇵🇬 Papua New Guinea||51.7|
|#148||🇸🇱 Sierra Leone||50.2|
|#153||🇬🇶 Equatorial Guinea||48.3|
|#157||🇨🇩 Democratic Republic of the Congo||47.9|
|#166||🇨🇫 Central African Republic||43.8|
|#176||🇰🇵 North Korea||2.9|
Only four countries in the world have a score of 80 or above, Ireland, Singapore, Switzerland, and Taiwan, categorizing them as completely free economically.
Let’s now look at things from a more regional perspective.
From a regional perspective, Europe ranks the strongest in economic freedom.
Despite being a powerhouse within Europe, Germany ranks 10th in the continent, with a score of 73.7. One of the categories Germany scored the weakest in was government spending (28.3/100). Over the last three years, government spending has averaged 49% of GDP.
Ireland ranks third globally, scoring particularly high in categories like property rights and judicial effectiveness. The country also has no minimum capital requirement—which is typically a banking regulation and corporate law issue determining how many assets an organization must hold—making it attractive for businesses to set up shop on the Emerald Isle.
Currently, Africa is the continent with the least economic freedom in the world, however, it is also the region with the highest potential for economic growth. A booming population, and thus, labor force, are promising for future innovation. In fact, it’s anticipated that Africa will see an increase of 2.5 billion people by the end of the century.
The lowest scoring country in Africa is Sudan, a country under further strain thanks to rife civil conflict. Historically, economic development has been constrained by rampant corruption and a lack of institutional capacity.
Conversely, Botswana registered the highest score on continental Africa (64.9), ranking higher than countries like France and Italy.
In the Americas, the United States ranks 3rd regionally—25th overall—with a score of 70.6. The report attributes the categorization of U.S. as only “mostly free” to issues like inflation, increasing government debt, and unchecked deficit spending. Public debt currently sits at a figure equivalent to more than 128% of GDP.
In South America, Chile comes out on top, ranking above many other economic powerhouses like the U.S., the UK, and Japan. However, the 2021 election of a new Constitutional Assembly could risk the current economic state, as it favors a much more socialist approach to the economy.
East Asia and Oceania
China’s score is among the lowest in East Asia & Oceania, ranking 154th in the world categorizing it as a repressed economy. The ruling Chinese Communist Party routinely exercises direct control over economic activity. China’s protectionist stance towards foreign investment and a plethora of trade tariffs imposed by other nations also factor in here.
In India, where public debt is equivalent to about 84% of GDP, fiscal health is the worst-scoring category. Additionally, much of the economy remains quite informal; a large share of people work in jobs without tax slips, recorded income, or formal contracts protecting them, which challenges labor freedoms.
The Middle East and Central Asia
It may come as no surprise that the United Arab Emirates has the highest score in the Middle East. The UAE has implemented various measures and initiatives, such as tax exemptions, duty-free zones, streamlined business registration processes, and flexible regulatory frameworks to encourage entrepreneurship and foreign direct investment. As well, the top individual and corporate tax rates in the country are 0%.
Türkiye’s lowest scoring category relates to judiciary effectiveness and the rule of law. President Recep Tayyip Erdoğan, who has already been in power for two decades, recently won the country’s election, again cementing his authority over Turkish politics. This makes it unlikely that Türkiye’s economic freedom score will recover in the short to medium term.
Where Does This Data Come From?
Source: The Index of Economic Freedom from the Heritage Foundation
Data notes: A number of countries were not ranked due to unavailable data or other factors, like ongoing war, that made it difficult to properly assess the economy. These countries include: Ukraine, Afghanistan, Iraq, Libya, Liechtenstein, Somalia, Syria, and Yemen.
Markets2 days ago
Mapped: The State of Economic Freedom in 2023
Announcement2 weeks ago
Join Us For Data Creator Con 2023
Datastream1 day ago
The 10 Longest Range EVs for 2023
Economy2 weeks ago
Charted: Public Trust in the Federal Reserve
AI2 weeks ago
Ranked: The World’s Top 25 Websites in 2023
Cities4 weeks ago
Ranked: Top 10 Cities Where International Travelers Spend the Most
AI2 weeks ago
Visualizing the Top U.S. States for AI Jobs
VC+4 weeks ago
Coming Soon: Here’s What’s Coming to VC+ Next