China

The economy of the People’s Republic of China is a rapidly developing and influential market economy. China is the third largest economy in the world after the US and Japan with a nominal GDP of US$4.4 trillion (2008) when measured in exchange-rate terms. It is the second largest in the world after that of the United States with a GDP of $7.8 trillion (2008) when measured on a purchasing power parity (PPP) basis. China has had the fastest-growing major economy for the past 30 years with an average annual GDP growth rate above 10%. China’s per capita income has likewise grown at an average annual rate of more than 8% over the last three decades drastically reducing poverty, but this rapid growth has been accompanied by rising income inequalities. The country’s per capita income is classified in the lower middle category by world standards, at about $3,180 (nominal, 104th of 178 countries/economies), and $5,943 (PPP, 97th of 178 countries/economies) in 2008, according to the IMF.

Demographic Data

Economic Data

Cultural & Other Data

GDP (PPP, $bn)

7,800

Capital

Beijing

Area (sq. km.)

9,596,960

GDP Real

Growth (%)

9.8

Other Large Cities

Shanghai, Guangzhou, Shenzhen, Tianjin

Population (million)

1,340

PerCap GDP ($)

6000

Primary Language

Mandarin

Population

Growth %

0.655

Prime Lending

Rate (%)

5.58

Urban

Population %

43

% Population

Under 15yrs

19.8

Inflation Rate%

6

Urban Growth %

2.7

Population below

poverty line (%)

8

Unemployment

Rate%***

4

Literacy

(% of population)

90.9

Agricultural Workers

(% of population)

43

Foreign Direct

Investment($bn)

758.9

Education spending

as % of GDP

1.9

Industrial Workers

(% of population)

25

Debt-External

($bn)

420.8

CPI Score

(1-10)*

3.6

Service Workers

(% of population)

32

Exports ($bn)

1,465

Corporate Income Tax %

25

Labor Force (mil)

807.7

Imports ($bn)

1,156

Ease of Doing

Business Ranking **

83

 

CURRENCY EXCHANGE RATE

05/11/09 $1 = 6.82 CNY

 

Franchising Laws Overview

Disclosure laws:

  • The franchisor must provide the prospective franchisee with a disclosure document at least 30 days before executing the franchise agreement.

Relationship laws:

  • The franchisor must have had two company-owned units (in China or elsewhere) for at least one year
  • The franchise agreement must provide for a “cooling-off” period
  • Minimum term of 3 years

Registration laws:

  • Franchisors must register with the Chinese government agencies (MOFCOM at the central government level) within 15 days after signing the first franchise agreement.
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