The End of Cheap Chinese Goods-What will it Mean for You?

by fulltimestudent 55 Replies latest social current

  • fulltimestudent
    fulltimestudent

    The Yahoo7 web-site (Aussie version) carries an item with this heading.

    Find it at:

    au.pfinance.yahoo.com/photos/photo/-/13263001/what-the-end-of-cheap-china-means-for-you/

    Its clear (to me, anyway) that big changes are coming, and have been in the pipe-line for at least 5 years. It was about that long ago, that I noticed a news report saying that the Guangdong (provincial) govt. had started telling the shoe manufacturing companies that their leases on the land on which their factories were built would not be renewed and suggesting they move out of Guangdong to make room for higher valued products. They had served their purpose in GD, so now these factories could move to some other place with poor people, even out of China into Vietnam, etc.

    At the beginning of this year, very large increases in pay rates were ordered by the Central government. Lots of workers got 50% or more increases. As a result many of the 100,000,000 migrant workers that provide factory labour to the east coast cities were now able to get a job nearer their homes.

    Even, 3 years ago, during my last trip to China, walking along a food street in the city of Suzhou, - ( i.e. that's quite a long street with mainly restaurants along its length), nearly every shop had a sign up advertising their staff vacancies.

    So what next? First, in all the cheap shops like Walmart in the US, Kmart and BigW in Australia, there will be an increase in prices.

    Second, because Chinese living standards will be higher, expect to pay more for commodities like coffee and meat, even milk.

    Third, there will be more Chinese tourists in your town (if its worth visiting), or competing with you in resort areas. And, Chinese airlines will become more visible.

    Fourth, China is going to change much more. It changes all the time now. But will change at a faster pace. On my first visit to Beijing in 2001, there were 2 subway routes, now there are more than 10. Nanjing had no subways, now there are 3 routes. Suzhou had none in 2001, Now there is one in operation and a second opens soon. Shanghai had two lines then, now a dense network covers the city. and connected into the network is a maglev train that speeds you from the subway to Pudong airport in 7 minutes at over 350 km/hour ( www.exploreshanghai.com/metro/ ) And then there is the fast train network. My first trip from Shanghai to Hangzhou, was on a all-stations train and took 4 hours, we went back to Shanghai on an express train in 2 hours. Now on the fast trains, its only a one hour trip. There is something like 12,000+ kilometres of high speed track already laid and in operation. There could be something like 20,000 km in operation by 2020.

    And finally, China has long been a destination for the curious and adventurous. Its now becoming a destination for many other reasons. Just as Chinese students now flood out to schools and Universities all over the world, So the world's students are flooding into China. Soon the top Chinese Universities will be grouped among the best in the world.

    And if your among the best in your field, you'll likely find a job in China.

    Hope you enjoy Yahoo's presentation.

  • wha happened?
    wha happened?

    where were cheap goods made before China? Mexico. Before that? Japan. Look for cheap goods from Indonesia, Vietnam, Laos, perhaps Africa. There's always a poor country around to exploit

  • EntirelyPossible
    EntirelyPossible

    I don't buy cheap goods (mostly), so ... it won't.

  • wha happened?
    wha happened?

    virtually every electronics is made overseas. You probably own a lot more items in your home that were made with cheap labor than would you feel comfortable with

  • EntirelyPossible
    EntirelyPossible

    oh, I know. I was saying I don't buy cheap goods, as in, low quality, not that I don't buy good made on the back of workers living in a fenced compound sweat shop for slaves wages.

  • Satanus
    Satanus

    Seems to me like a win win situation. It's better for the chinese workers, and it opens the door a crack for native industry to be able to compete better. What i mean is industry back in the usa and canada.

    S

  • fulltimestudent
    fulltimestudent

    What does it mean for me? Good question! Materially, very little. I'm already "chinese" in that I'm daoist in attitude and try to live a simple life. An $8.00 T-shirt from Kmart that likely cost them $1.00 ex the factory gate suits me fine (presently). (As an XJW, I am somewhat allergic to suits and no longer possess one.)

    From an academic viewpoint, though all this means a lot. Historically, we seldom have an opportunity to watch the rise of a world power, particularly the way this is working out. In reality though, we are not seeing the rise of China - we are seeing a restoration of China. Before 1800, China was likely the richest nation on earth. Why, then did it collapse so easily? I think there are two aspects to that historical collapse. First, was the fact that what we call China was then actually captive to the Manchu dynasty called Qing. The focus of the elite was to maintain their dominant position as overlords of China, although in practise, they had already been absorbed by the Chinese civilisation. (More or less before they even commenced their project to take control of China. But so complete was the Chinese absorption of the Qing, that when the dynasty finally collapsed and war-lors took control of Manchuria, they did not seem to have any intention of detaching themselves from civilisational China. And, today. the dongbei (the north east), the former Manchuria is as much Chinese as any other part of contemporary China.

    The second reason for the collapse, was that the focus of the state by 1800, seems no longer to have been to maintain control by force. The English writer, Somerset Maugham interviewed a Chinese philosopher in the 1920s, by the name of Gu Hongming. Gu was a supporter (still) of the Qing, and who claimed in the interview that the Chinese elite had tried to rule, not by force, but by wisdom. He then asked Maugham a rhetorical question - "Why does the white man despise the yellow?" And answered himself, "Because he (the white man) has invented the machine gun. ... We are a defenceless horde and you can can blow us into eternity. ... And now you are teaching our young men your secret ... Do you not know that we have a genius for mechanics? ... that there are in this country (hundreds of millions) of the most practical and industrious people in the world."

    So watching this process of change in the world is an almost unbelievable opportunityto see a huge historical event happen before my eyes.

    Read the Amazon review of the book mentioned in the Yahoo story. He's a Harvard graduate, who first went to China in the 1990's.

    www.amazon.com/End-Cheap-China-Economic-Cultural/dp/111817206X

    Another interesting book, is China versus the West, by Ivan Tselichtchev.

    www.asianreviewofbooks.com/new/?ID=1295#!

  • jwfacts
    jwfacts

    I think this is great. There is no reason why the first world should prosper at the expense of developing countries. Globalisation is positive for the world if it brings the majority of people from all countries into a middle class.

  • fakesmile
    fakesmile

    OH NO, does this mean we will be flooded with reasonably priced, american made, quality products? aww hell. this is it. this is the end.

  • Aussie Oz
    Aussie Oz

    I have always figured this:

    Once upon a time we had our own manufacturing industries. Then we began to allow cheap import goods from overseas, japan at first but most notably china. There was no way we could compete because the wages there were so low. After a while we sent all of our machinery to the scrap yard amd melted them down, sent the steel to china to make crap goods that we bought. The once thriving company i once worked for literally died because of China and the retailers that felt they had to stock imported goods, and in fact, they had to because their competition did.

    Then one day, china will say something like "ha! You no can make now, you pay more!"

    China is a two edged sword for me. I really try to buy australian made but it is damn near impossible. As a manufacturer, i loath China and actually wont sell or deal with them at all. They are the knock off kings and i will be buggered if i will send them my stuff to copy. I hate having to buy imported crap (and that is what most of it is) because i cant get better. I see all the clothing stores, all the hardware stores, chock a block of chinese and other imports and realize that $5 item i had to buy cost them 50c and some guy got paid 5c to make it.

    If china gets dearer maybe, just maybe we will claw back some our manufaturing abilities, but i doubt it. The cost of re-tooling is to large.

    Globalization has meant that Chine, tiawan, india etc are the manufaturing entities and the western world are the consumer entities.

    I am lucky that what i make is one off custom work a lot of the time and my clientel like to deal with an aussie, that said, damn china is making inroads into my living nonetheless.

    No love to china from oz

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