Monday, November 5, 2012

Misunderstanding China Again

The China Bashers have new data.

  • Exports are down.
  • Domestic Consumption is up.
  • There is an aging population.

Their assumptions? China will

  • Lose competitiveness
  • Watch its labour force dwindle 
  • Suffer economic decline
  • Reel from increasing unrest.

As the world moves closer to the divide: high tech v. growing emerging-nation labour market, China will be in a position to leverage its advances in technology, engage in foreign capital investment, cement diplomatic and economic alliances globally, and prosper.

Aging populations are more conservative and less disruptive.

China lifted 500,000,000 people out of poverty.  (Some will forget. Prosperity does that to people. However, not all will forget.)

Needless to say, it is not improbable that China will modify its one child policy.  This China will do when China sees a need to do it.

China repudiated not only the Soviet Style of Communism, but also the socialist-light style embraces by some of our Pilgrim forefathers.

Recently someone or other mentioned a rise in Chinese nationalism and attempted to define it as looking to the government for assistance.  That is wrong.  Chinese nationalism can be more properly defined as the Chinese people becoming increasingly more concerned with what is in the best interest of China.  This is not unique to China.  Many nations do this.

If the reports are true, and domestic consumption is up, does that not suggest that the Chinese people are buying products made in China?  It would if Chinese exports are down.  Another report.

Would foreign capital investment not benefit China?  [Translation: Foreign capital investment will benefit China.]

Follow the path of the trajectory.  China moves from direct foreign investment (international business model) to the multinational business model.  Some examples would be China's purchase of a Portuguese, government-owned, power company; investments in railroads to bring Brazilian crops to port; and recent talks with Greek shipping companies.  All this has been reported in the news.

What the Chinese appear to have been doing is what I recommended to American businesses looking to do business globally in "Global Management: A shift in the paradigm of corporate America"

In that presentation, I explained to American corporate leaders how to approach the global business community.  But why explain that to American corporate leaders?  They've been doing that for years, right? Right.  However, the world has changed--the American Corporate Paradigm has not.

China recognises the shift in the global economic paradigm and is responding to it.



If you find anything here to be helpful, please do not hesitate to send me a really tricked-out laptop and to put a few dollars into the envelope along with the thank you note. Slim

Pack it up and ship it off to me, [FedEx] 

Copyright (c) 2012 Slim Fairview
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