Making a dynasty: Examining China's rise to become a manufacturing giant - industrial air conditioner
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Chinese goods seem to be everywhere today.
Think about it: at the Rio Olympics this summer, Chinese companies provided volunteers with mascot dolls, most sports equipment, safety monitoring systems and uniforms, technicians and even the torch. bearers.
Do you own a PC or air conditioner or a pair of shoes or a set of plates from Walmart
Almost certainly, they all have labels made in China.
In other words, China has become an "export machine" with a growing share of world products.
After joining the World Trade Organization (wto) in 2001, the initial success of China's exports in 1990 surprised everyone, including Chinese policy makers.
As a result, China's economy has grown by more than 9% over the years.
China overtook the United States in 2014. S.
In purchasing power parity, it is the largest economy in the world.
This is a country's per capita national income of only $155 in the 1970 s to become one of the most powerful countries in the economy is only 40 years answer not only according to the story of China's success, but it also provides important lessons for the government to consider turning internally, such as the incoming Trump administration.
In the spring of 1976, I visited China for the first time-just before China reentered the global market.
Over the next few decades, research, teaching and taking students to China have given me a window to observe the dynamic developments that have taken place.
Now, as a clinical professor at Georgia State University and director of the nonprofit China Research Center, I am involved in research and outreach to inform policy and business to strengthen the U. S. -China relations.
Historically, China has a close relationship with world commerce.
From the Han Dynasty (206 B. C. -A. D. 220)
Until Ming (A. D. 1371-1433)
Commodities, cultures and religions flow through the Silk Road through various land routes between Central Asia, the Middle East and China.
The sea expedition began in the Ming Dynasty, when the famous Captain Zheng He took seven ships and established trade with Africa, Arabia, India and Southeast Asia.
In the 1900 s, Shanghai was called "Paris of the East" for its role as a trade and financial center ".
But after Mao led the Communist Party in 1949, China set up a planned economic system that withdrew from what the Communist Party considers to be a global market for capitalism and imperialism.
Foreign assets were nationalized and the company left the country.
In the 1950 s, trade with the communist Soviet Union and Eastern Europe increased, but as China developed, trade fell sharply.
The Soviet Union split in early 1960. The U. S.
From 1950 to the beginning of 1970, there was no official trade link with China.
From Mao's point of view, China's goal is to build a strong economy through self-development.
Meet all its needs.
He believes in himself.
Even every province should have enough money.
Regardless of the geographical location, his policy of "growing grain everywhere"
To what extent did he implement the strategy.
One consequence is the catastrophic great leap forward, with an estimated 30 million people or more dying from famine.
Part of this disaster is self-promotion.
Dependence on rural industries and the setting of impossible targets for food production.
The idea of production specialization based on the relative efficiency of resources is considered capitalist and dangerous for the development of communism.
To benefit from specialization, China must rely on other countries to cope with competition.
China's economy has been slow to grow due to rejection of specialization and trade, living conditions based on backward technology are poor, and there is little domestic communication, let alone between China and the world.
Because since the beginning of 1950, China has not been open to foreign investment, exports are mainly to pay for basic imports, so China's exports in 1978 were worth less than $7 billion, only $0.
3% of today's value
This isolation has led to a low standard of living in China.
Its per capita gross domestic product was $155, ranking within the 133 countries reported, slightly higher than that of Guinea-
Guinea-pig and Nepal.
When I visited in 1976, I saw men with belts wrapped around their waist a few times-because they were thin, maybe because the planned economy didn't produce many size belts
After Mao Zedong's death in 1976, a group of leaders, including Deng Xiaoping, re-established global ties, believing that market reform will revitalize the economy through more effective production and better technology. China’s so-
On December 1978, the third plenary meeting of the Central Committee of the Communist Party of China officially started the so-called "opening up ".
As part of the reform strategy, Chinese leaders have set up four special economic zones in southern China near Hong Kong to encourage foreign companies to invest in production for export purposes. The most well-
Located in Guangdong province, Shenzhen is a well-known area of Shenzhen. At the time, U. S.
After rising wages in East Asian countries such as Hong Kong, South Korea and Taiwan, Japanese and European companies are looking for new locations to make goods cheaply.
Foreign investment is rarely welcomed by other countries.
For example, India has kept foreign direct investment closed for the next decade.
In other words, China's policies have changed at an accidental moment.
The rapid transfer of companies to China, especially from Hong Kong across the border, has created a deep manufacturing capability and become the center of the world's supply chain.
2006. foreign companies provide nearly 60% of China's exports and nearly 43% people so far.
The power of specialization China's export story is a lesson from the power of globalization.
Specifically, China's policies have taken advantage of comparative advantages.
It attracted foreign direct investment by encouraging exports, including undervalued exchange rates and large populations willing to work at relatively low wages.
The return on this investment is for infrastructure, education, R & D and institutions --building.
This focus on domestic capacity supports growth and improved living standards, avoiding a "middle-income trap" where a country cannot move production to the lower end of the value chain ".
Over time, with the development of management skills and market knowledge, Chinese domestic enterprises are becoming more and more competitive.
In recent years, even small domestic companies have increased their exports due to international e-commerce.
Business platforms such as Alibaba.
China's passion for global commodity trade and capital markets has made it
At present, the per capita GDP of the United States is nearly $8,000. S.
The US dollar is also the world's largest producer of manufactured goods.
Chinese families now have enough income to travel around the world.
Chinese tourists are expected to soon become the largest group of tourism consumers.
At the same time, Laborintensive, low-
In Bangladesh, Vietnam, Cambodia and elsewhere, the wage manufacturing industry is turning to new opportunities, and the composition of Chinese exports is shifting from textiles, furniture and toys to advanced pumps, electronics and engines.
China is successfully upgrading its value chain.
The next stage and lesson of AmericaS.
However, looking ahead, exports are unlikely to dominate China's development process.
It will invest abroad.
Chinese companies are investing globally.
In 2015, their investment outside China was worth $1 trillion, compared to $57 billion a decade ago.
Some analysts expect that figure to double by 2020.
The impact of Chinese companies' overseas investment may seem as big or even bigger as the impact of exports.
China's outbound investment is growing very rapidly, both because of China's industry conditions and because Chinese leaders have relaxed restrictions on outbound investment, and because business managers are becoming more and more capable. In just the U. S.
It is estimated that Chinese companies have invested $64 billion and hired 100,000 people.
So while we will continue to buy "made in China" items, we will increasingly work with and for these companies.
If we are lucky.
If the next government fulfills its campaign promise, then the United StatesS.
May miss many of the benefits of foreign investment from China and elsewhere, such as new jobs and towns with tax revitalization --
In recent decades, the United StatesS.
Help China join the global market through corporate investment and government policies.
Both countries have benefited a lot.
Ironically, China has learned the lesson of isolation and is now promoting trade agreements to replace US trade agreements. S.
May remain on the table, such as the North American Free Trade Agreement and
Pacific PartnershipAnd if the U. S.
Start a trade war with China, and then all the bets are gone.
Not only will new jobs not be realized, but also low
The cost goods we enjoy will be more expensive, and our growing exports to China will undoubtedly be hurt by Chinese retaliation. Penelope B.
Professor of International Business clinical, Georgia State University, director of China Research Center