China has experienced a big rise in exports

Dr Linda Yueh of the London School of Economics and Oxford University was speaking at a forum on globalisation and China organized by the Caribbean Development Bank in Barbados.

The growth in the Chinese economy has been phenomenal, measuring an annual average of 9 per cent over the last three years.

Dr Yueh said while the experience is that neighbouring countries are benefiting from China's growth - supplying its economy with services - other developing countries will come under pressure to compete.

This view is supported by economist at the Barbados Central Bank, Dr Deny Lewis-Bynoe who said:"the opportunities that have opened up in China are in a very real way impacting on the amount of foreign direct investment that we are able to attract."

China's Economic Rise China's share of global exports rose from just 1.2 per cent in 1982 to 5.2 per cent in 2002 Foreign direct investment in the Chinese economy rose from almost zero in 1984 to $120 billion in 2002 China has $810 billion in foreign currency reserves, the second largest quantity of foreign reserves held by any country

Dr Yueh said "China is one challenge on top of a number of challenges" that developing countries are faced with, and its economic power will make it harder for small states to compete in the global market.

However, she said there are some things the region can do to lessen the fallout from China's rapid growth, such as targeting tourists from the new Chinese middle class which numbers some 400 million.

China's problems

The picture is not all doom and gloom for the Caribbean.

Dr Yueh said China itself has its own challenges as the State sponsored growth and expansion has benefited mainly the urban communities and left hundreds of millions in poverty in the rural areas.

The economist said this is leading to the drift of the rural population away from agriculture.

She added that there is no social safety net for people who do not make it in China's economic boom.

She said China will also have to tackle other issues such as environmental problems and political transformation as it becomes fully part of the WTO and global community.