Over the years, China has become gradually more industrialized. Like
other modernizing countries, for instance, the contribution of
China's agricultural sector to its GDP has kept decreasing, from
37.9 percent in 1965 to 28.4 percent in 1985 and then to 18.4 percent in
1998— a net decrease of 19.5 percent in the 3-decade period. At
the same time, the contribution of the industrial sector to
GDP has kept increasing, from 35.1 percent in 1965 to 43.1 percent in
1985 and then to 48.7 percent in 1998, a net increase of 14.6 percent in
the 3-decade period. The contribution of tertiary industry (service) to
the GDP has increased from 27.0 percent in 1965 to 28.5 percent in 1985
and then to 32.9 per cent in 1998, a total increase of only 5.9 percent
in the same period.
The world's economic development history indicates that as a
country heads toward modernization, the ratio of agriculture to its GDP
is set to drop, the ratio of service to its GDP will go up, while the
ratio of industry to its GDP will first go up and then drop.
China's economic
development followed the same patterns. For instance, the ratio of
agriculture's
value added
to the world's GDP was 7 percent in 1980 and fell to 5 percent
in 1998. The ratio of agriculture's value added to the GDP of
developed countries is normally 2 to 3 percent. The popular development
model also demonstrates that when the GDP annual per capita income stood
between US$300 and US$500, the proportions of agricultural and
industrial sectors were virtually similar in the GDP while the
employment proportion was higher in agricultural sector; when the annual
per capita income reached US$1,500, the proportions of the industrial
sector and service sector were basically similar in the GDP while the
employment proportion in agricultural sector fell to the lowest
proportion. However, China's situation varies somewhat from the
traditional development model. For instance, in 1999, the per capita
income in China exceeded US$1,000 (using the
purchasing power parity
method), while the proportion of the employment in the agricultural
sector was still as high as 50 percent.
As shown above, non-agricultural industries' value amounts to the
main body of the national economy, but the proportion of employees in
the agricultural sector dominates the workforce at present and will do
so in the future. The conflict of a dual economic structure is still
obvious. It is reflected in the enlarged income gap between industry and
agriculture, rising from 2.12 in 1991 to 5.25 in 1995, and its estimated
value will reach 5.62 in 2005. Obviously, the changes of the industrial
structure and employment structures are not consistent with other
developing countries. The Chinese government and scholars have noticed
this phenomenon, and many efforts have been made to reshape the
structure more properly.