Today, we will introduce some basic Chinese terminology in economics and finance, which is an important tool for you to have nuanced intellectual discussions in Chinese and is consequently beneficial for your AP Chinese exams. Of course, to use these words accurately, you not only need to know their corresponding English terms, but should also have some understanding of their underlying economic concepts.
The gross domestic product (GDP) and gross national product (GNP) are such common terms that many Chinese articles simply use the English abbreviations of them. But in many formal occasions, especially in Chinese language exams, using Chinese terms is more preferable.
GDP is translated as 国内生产总值 (guó nèi shēng chǎn zǒng zhí), meaning the total value of products that were produced within the national border in a given time period.
GNP is translated as 国民生产总值 (guó mín shēng chǎn zǒng zhí), meaning the total value of products that were produced by a country’s citizens and firms (regardless of locations) in a given time period.
Whether a country is considered under growth or recession is normally measured by its GDP. The term for growth is 增长 (zēng zhǎng), and for recession is 衰退 (shuāi tuì).
Knowing the four components of GDP is quite useful in understanding a country’s economic structure, or just for showing off.
- Consumption (消费, xiāo fèi): the products that are consumed by private entities.
- Government expenditure (政府支出, zhèng fǔ zhī chū): the products that are consumed in government activities.
- Investment (投资, tóu zī): the products that turn into capital for future production.
- Trade balance (贸易平衡，mào yì píng héng): total export minus total import (of course, it can be negative if a country imports more than it exports).
A country’s domestic products have to fall into one of these four exclusive categories. They are either consumed privately, consumed by the government, saved for future, or sent abroad. The latter two categories are normally beneficial for future growth while the former two categories are good for present enjoyment. Both are essential for the wellbeing of a society and the policy-makers always struggle to find a good balance. It is widely believed that the Chinese economy grows fast because of the high investment and high export. But the downside is that very often the citizens, especially the poorer part of the population, often fail to enjoy the benefits from growth. So, is China’s investment and export-driven growth model on the right track? Or did it sacrifice too much in terms of social welfare, labor rights, and leisure? You can see numerous scholars and pundits discussing the issue and develop your own opinion.
As you probably heard from the news, China and the US are having a trade war (贸易战, mào yì zhàn) right at this moment by raising tariffs (关税, guān shuì) on each other’s products. So when you visit Chinese websites you can frequently see many terms related to trade. For example, trade surplus (贸易顺差, mào yì shùn chā) means a country’s export in excess of import while trade deficit (贸易逆差, mào yì nì chā) means the opposite. It is not accurate to say that a trade surplus is necessarily better than a trade deficit. But maintaining a trade surplus does make it easier for a country to stimulate growth and employment. One of the key reasons of the trade war is that China has maintained a constant trade surplus against the US. Whether the trade war will be effective is an extremely complicated policy question that few have an answer.
Many terms that are related to trade may also benefit Chinese learners who want to express more sophisticated ideas, such as trade barrier (贸易壁垒, mào yì bì lěi), import quota (进口配额, jìn kǒu pèi é), export subsidy (出口补贴, chū kǒu bǔ tiē), and exchange rate (汇率, huì lǜ). Of course, the trade vocabulary is far from these. But starting from these basic ones can help you understand others more easily or, if you don’t plan to go for more advanced terms, at least use them to show off your academic training.