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^There will always be alternative to China in terms of cheap labor (yes Vietnam, I'm talking to you), where the US capitalists can take advantage of.
people keep saying this, but it is easier to say than done. Why hasn't India, Vietnam, Bangladesh replaced China as the world's manufacturing centre?
It is not just about cheap labour. The skill/education level of labour force, public infrastructure as well as a mature logistic system play a crucial role. If country can't transport products efficiently as desired by the company, what's the use of producing all the cheap products?
Labour shifting will happen, but it won't be fast. China also is fully aware it can't depend on export (and government spending) forever and is doing a lot to stimulate domestic demand, with a lot of success.
When China manages to create a large middle class with ample purchasing power, that's time China can seriously challenge western powers like the US.
Isn't it cheaper or about the same to manufacture in the Philippines, too? The Philippines is also very American friendly, which is why a lot of US call centers were outsourced there
I believe labor cost is the same. But there's too many internal issues in the Philippines that drives away foreign manufacturers such as high power cost (triple or quadruple the price of that of China), poor infrastructure (for shipping and logistic), supply chain challenges etc...
Services such as call center is different scenario though.
When China manages to create a large middle class with ample purchasing power, that's time China can seriously challenge western powers like the US.
A 'large middle class with ample purchasing power' will be the death of the Chinese economy. A vast, criminally underpaid lower class* is how China can afford to sell the West such cheap widgets.
A large middle class will demand a living wage, causing their export prices to rise dramatically. The West will then start buying their widgets from other countries who still have a vast, criminally underpaid lower class*.
And that's just one of many, many problems China faces.
China won't "seriously challenge western powers like the US" in my grandchildren's lifetime, and I don't even have any kids yet.
*Slave laborers who can't afford to purchase the products they produce.
A 'large middle class with ample purchasing power' will be the death of the Chinese economy. A vast, criminally underpaid lower class* is how China can afford to sell the West such cheap widgets.
A large middle class will demand a living wage, causing their export prices to rise dramatically. The West will then start buying their widgets from other countries who still have a vast, criminally underpaid lower class*.
And that's just one of many, many problems China faces.
China won't "seriously challenge western powers like the US" in my grandchildren's lifetime, and I don't even have any kids yet.
*Slave laborers who can't afford to purchase the products they produce.
Why is this a problem for China? The Chinese would be moving up the value chain and using their comparative advantage to take more high paying jobs. If anything, it will be a problem for the West.
A 'large middle class with ample purchasing power' will be the death of the Chinese economy. A vast, criminally underpaid lower class* is how China can afford to sell the West such cheap widgets.
A large middle class will demand a living wage, causing their export prices to rise dramatically. The West will then start buying their widgets from other countries who still have a vast, criminally underpaid lower class*.
And that's just one of many, many problems China faces.
China won't "seriously challenge western powers like the US" in my grandchildren's lifetime, and I don't even have any kids yet.
Are you sure?
As of Oct 2014, China's current account balance is only 2% of GDP, compared with 7.2% for Germany, 10% for the Netherlands, 12.3% for Switzerland. It was over 12% a few years ago.
China may export a lot of stuff, but the times when it highly DEPENDS on exporting is over a few years ago.
A large middle class won't be the death. It will be a revival of the economy so that the country can more and more rely on domestic demands. In case you didn't know, Chinese labour costs have been rising rapidly, in some areas by 20% a year. Stop using sensational words like "criminally low wages" as if what the west does is the world standards. A crime according to whom? I can also say western unions workers are making criminally high wages that don't reflect market demand and supply at all.
Your last conclusion is more like your wishes, not a sensible argument. I am not gonna comment on that. Did you forget China is already vetoing a lot of things on the UN the west wishes to do? Did you forget UK etc. stopping meeting Dalai Lama a while ago? The power is quietly shifting and you are stuck in the past thinking the mighty west will dominate forever. I feel sorry for your grandchildren, who might have to work for a Chinese company at their time. They might have to learn Mandarin just to make a living.
Why is this a problem for China? The Chinese would be moving up the value chain and using their comparative advantage to take more high paying jobs. If anything, it will be a problem for the West.
that only shows its extreme ignorance in believing that countries producing cheap goods will always have to produce cheap goods to make a living.
not many years ago, Japanese exports were exactly like current Chinese products, considered by Americans as cheap and of low quality (he probably isn't old enough or educated enough to know that). Japanese cars were considered crap. Even 10 years ago Korean cars were considered crap as well but now they are competitive. Things change, and with proper policy, countries do climb up the value chain.
Considering the population, China will never be as wealthy as America on a per person basis. But to claim China as a nation will never be strong enough to challenge the US, 1/4 of its population size, is just wishful thinking.
Powerful countries wax and wane. Spain and Portugal did. the UK did. Japan did. So will the US.
Why is this even considered a major statistic? The only one that truly matters is real, pure dollars- and the US is still far ahead of China in that category. So no, China is not the biggest economy. It WILL get there someday in the not too distant future, as it should since it is so much bigger than the US- but it's not there yet.
Calm down. Taking this way too seriously. And instead of arguing with us on C-D can't you just go back to China? I mean, as you said, it should be pretty common to find a $50K job there. Canada is clearly too backward, too inefficient, and too boring for you. Nobody, not the Canadian government, not the Province of Ontario, or the City of Toronto is begging you to stay, nor did anybody actually invite you to immigrate here in the first place.
Good points. Sure there are people who make some great money in China, but they are then stuck living there in the substandard living conditions. My wife is from there, her family still lives back there in Guangzhou so we go every couple years to visit. She has a friend who manages a luxury car dealership there so she earns more than my wife and I combined- she earns great money. But yet her home is not nearly as nice as the modest place we have here in Seattle on our less than median income- that friend was here to visit us a few weeks ago and wouldn't stop raving about how nice homes are here. So even as pay rises in China, there will not be a rush to go there, as people know the living standard is SO much better in places like the US and Canada- even compared to those who make good money in China.
And the job market is not great over there, either. My wife's sister graduated college a few years ago with great grades, and had a connection through her parents to get the job she has- which is totally unrelated to her college major. It's the only way to really get work over there, to have connections. Otherwise it is extremely competitive. Anyway, she has no real opportunities for much advancement, it's hard to move on to anything different in regards to finding new jobs, and after several years at the same job, she only gets 1 week of paid vacation time. So even now with China doing better than ever, many there still look to the US as a big upgrade in not only living standard but also working conditions- the vast assortment of job options, the freedom to be able to find more suitable employment, the better working conditions in regards to paid time off and other benefits.
I know there are some very high level types of people who are deciding to move back from the West to their homes in China for jobs and that is great- but I don't see any great reverse migration any time soon, from my limited sample group with the wife's friends and people they know (and these are all educated people with money), the flow is all towards US and Canada- nobody at all is considering moving back to China.
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China didn't overtake the USA as much as the USA fell behind China
