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1. The Profile of the People’s Republic of China (PRC)

1.1 Overview

a. PRC is the world’s third largest country, next to Russia and Canada.

b. PRC has a population of approximately 1.25 billion people, which constitutes about 22% of the

world’s population.

c. PRC is divided into 22 provinces, 4 municipalities, 5 autonomous regions and one special

administrative region (i.e., Hong Kong). These 32 areas all have equal political status and report

directly to the State Council on all matters.

d. PRC has been transforming from a state-controlled economy to market-driven economy in recent

years. From 1992 to 1997, the average annual growth rate of PRC’s GDP is 23.3% whereas the

average growth rate of the developed countries in the same period is merely 2%.

e. From 1992 to 1996, PRC’s utilization of accumulated foreign capital is US$200.43 billion. Since

1994, PRC has continuously ranked 2nd in the world in attracting foreign capital, next to the U.S.

1.2 Economy

a. Size of Economy (excluding Hong Kong & Macao)

Year GDP (RMB: billion yuan) Growth Average Exchange Rate of US$/RMB

1992 2,663.8 (US$483.4 billion) 23.23% 5.51

1993 3,463.4 (US$601.3 billion) 30.02% 5.76

1994 4,675.9 (US$542.4 billion) 35.01% 8.62

1995 5,847.8 (US$700.3 billion) 25.06% 8.35

1996 6,788.4 (US$816.9 billion) 16.08% 8.31

1997 7,477.2 (US$903.0 billion) 10.15% 8.28

1998 8,060.4 (US$973.5 billion) 7.80% 8.28

1999 8,624.7 (estimated) 7.00%

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