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On 14 Dec 2012 at 12:05am Local wrote:
I've started a new thread as I can't post on the pevious Caffe Nero one...
I don't think anyone currently over the age of about 20 needs to worry about China's future prosperity in their lifetime!
When I was a kid, my 'tat' was made in Hong Kong. That place matured, and shifted upmarket in terms of their economy.
China will apply Japan's definition of R&D - refine and duplicate - to most hi-tech industries, and see off the likes of Germany who will be buried under Europe's woes.
Any school worth it's salt should be teaching Chinese...
On 14 Dec 2012 at 9:11am Southover Queen wrote:
I dunno, Local, at least I dunno about the ground it will occupy in the future. There are two reasons for that: first of all, both Hong Kong and Japan are primarily export economies, by which I mean that most of what they manufacture only has a small home market. China is so enormous that they probably don't strictly need the outside world at all any more and while they've exploited the world's demand for their stuff they could manage without us for quite long time. They're busy building the infrastructure - the cities, transport systems, industry - that they now need.
Secondly, Japan's economy has been struggling mightily recently. I'd guess that's because they've stopped making a lot of the stuff which we think of as "Japanese" and instead have commissioned it from South Asia. So my Panasonic telly is probably made in South Korea or even China. Will China want to follow that model? I don't know: at the moment they seem to be doing nicely with textiles and tat!

I disagree about Germany, who seem to have found a niche producing goods which are "the best", particularly in engineering. Crucially, they seem to have managed to keep a lot of the manufacturing of those goods on home turf, so Mercedes, BMW and Miele are still made in Germany. I'd guess that if you're a very status conscious person that "Made In Germany" stamp is important, and I believe that China's rich are now importing a lot of these high status luxury goods. I wonder if Germany is sort of immune just by virtue of the excellence of its manufacturing and engineering?
On 14 Dec 2012 at 12:31pm Ed Can Do wrote:
I've been to China and rumours about it being a land of milk and honey, rolling in cash are seriously exagerated. China is very much a third-world country with a tiny minority of extremely rich people exploiting the natural resources of their country, both minerals and people. As the country gets richer, people there are getting more access to global media, it's getting harder and harder for their government to keep the populace compliant. With exposure to our decadent, western ways of living, the people of China will increasingly want that for themselves and demand higher wages and better working conditions. It won't happen overnight but eventually China will no longer be able to produce goods at a bargain rate and the focus of production will shift somewhere else, probably Africa.

On top of that, more and more American companies are moving their prodution bases back to the US and US protectionism is going to become and issue for China's export market. A skint Europe can't buy Chinese goods either so the future is not entirely rosy for China.

Japan is suffering from a very traditional system of company management where control is kept within families. Also nearly getting wiped off the map by earthquakes, tidal waves and near misses with nuclear reactors isn't helping and they never really recovered from the property bubble bursting in the 90's (You know that was caused by banks lending money to Yakuza gangsters to buy land who when asked to repay the money simply turned round and said no, prompting a near total collapse of their banking system. Most of the prime real estate in Japan is owned by organised criminals).

I thin the future for 20 year olds will be a world dominated by large comanies rather than nations. People are more able to move around the world than ever and conducting business at huge arms length is very easy thanks to the internet. If I was 20, I'd be more worried about Nestle and Glaxo than China.
On 14 Dec 2012 at 12:56pm Southover Queen wrote:
I think that's right, Ed. You have an advantage over me in having actually been there, but I do have friends who have been very closely involved in documenting China's development over the last 20 years. From what they describe the cities have quite important concentrations of mega rich and I'm sure that will cause huge problems very soon. China is still importing steel, which I gather indicates how quickly the country is being industrialised (although it's dropped recently in the recession) and certainly the government knows that inequality is the biggest challenge they face. The vast enrichment of a small group seems to have a direct parallel in Russia, and obviously post "communist" countries struggle with exposure to unrestricted capitalism.

The US probably will try to manipulate their markets, but I wonder if it's too late? So much of their industry is now owned by China...! I do agree that multinationals pretty much direct how the world works - just look at Starbucks and Google. They're far more powerful than any single government.

I didn't know that about the Japanese economy. How very interesting!
On 14 Dec 2012 at 7:44pm Ed Can Do wrote:
Shanghai is a bizarre place. There's a central street which looks identical to Oxford Street or any other major shopping street in any European city but then no more than 20 yards down any side street you have people living piled on top of each other in pokey little houses letting their kids go to the toilet in the street. There's a Ferrari showroom there right next to a bakery selling steamed buns for 2p each.

A bigger problem for China than US protectionism is likely to be the impact of Western companies and their patent lawyers. In China you can get anything you want, faked, for a fraction of the price. We met an ex-pat jewellry designer who said she had to work on commission only because if she displayed any of her stuff in a shop or on a website, two days later there were versions of it for sale on the street corner for a tenth of the price. Apple found not just fake products but four complete fake shops in one Chinese city! The Chinese just don't care about copyright or patents and any western company looking to seriously have an impact in the Chinese market will have to learn to work around that. Likewise, as the Chinese get access to a more global market themselves, their knack for fakery will spread to other countries. It's already hilariously easy to buy faked, Chinese goods on eBay and it's only going to get worse.
On 14 Dec 2012 at 10:53pm Blip wrote:
I did hear somewhere that the Chinese are said to be excellent copiers and fakers, but not so good at inventing and initiating. Does anyone agree with that? If true, do we need to get worried at all?
On 15 Dec 2012 at 1:33am Dave wrote:
Nobody needs to get worried about anything
On 15 Dec 2012 at 9:48am Ed Can Do wrote:
I've read suggestions that the Chinee arent much good at innovation as a direct result of centuries of heavy state control. In a nation where independant thought is positively discouraged, people are less likely to come up with original ideas and innovations. It's not that the Chinese aren't creative, there are examples of Chinese ingenuity everywhere and with such a huge population, statistically there must be a bunch of geniuses living there, but their mindset is not one that encourages new ideas.

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