China's trade bomb . . .

[Cowperson]

A good column in the Washington Post looking at how global trade has been impacted by China and what the future may look like.

If nothing else, small factoids like this bring perspective:

It sometimes seems as if almost everything we buy comes from China: DVD players, computers, shoes, toys, socks.

This is, of course, a myth.

In 2006, imports from China totaled $288 billion, about 16 percent of all U.S. imports and equal to only 2 percent of America's $13.2 trillion economic output (gross domestic product).

Does that mean we don't have a trade problem with China? Not exactly.

China is already the world's third-largest trading nation and seems destined to become the largest. On its present course, it threatens to wreck the entire post-World War II trading system. Constructed largely by the United States, that system has flourished because its benefits are widely shared. Since 1950, global trade has expanded by a factor of 25.

By contrast, China's trade is mercantilist: It's designed to benefit China even if it harms its trading partners.

And he goes on to explain his reasoning on the matter.

http://www.washingtonpost.com/wp-dyn...d=opinionsbox1

Cowperson

[Slava]

I just finished a book called "China Inc." regarding the Chinese economic growth and its potential global impact. It is written by an American and it uses a lot of US examples as a result, but it is fascinating and terrifying all at once.

With the recent Chinese property ownership laws enacted growth could be even larger. I read yesterday that the Chinese government might well be successful in slowing the rapid growth, but even in this instance it is a lot of growth to be sure!

[Incinerator]

Better start taking those Mandarin lessons before our Chinese overlords take over the world...

[Cowperson]

I think the concensus opinion would be that China will eventually have significant problems with things like a market imbalance in its male/female population plus a rapidly aging population which will see about one-third of Chinese over the age of 65 by, I think, 2030. There are already significant riots in parts of China essentially boiling down to a lack of spreading of wealth, something authorities are starting to express an interest in.

Eventually, many people think, the slower moving but much younger India will overhaul China and leave it in the dust.

Still, the point the author makes is that China may eventually destroy its customers through its trade practices and currency indifference . . . . and without broad internal wealth generation, that might be fatal as well.

The world is always an interesting place.

Cowperson

[Slava]

Originally Posted by Cowperson

I think the concensus opinion would be that China will eventually have significant problems with things like a market imbalance in its male/female population plus a rapidly aging population which will see about one-third of Chinese over the age of 65 by, I think, 2030. There are already significant riots in parts of China essentially boiling down to a lack of spreading of wealth, something authorities are starting to express an interest in.

Eventually, many people think, the slower moving but much younger India will overhaul China and leave it in the dust.

Still, the point the author makes is that China may eventually destroy its customers through its trade practices and currency indifference . . . . and without broad internal wealth generation, that might be fatal as well.

The world is always an interesting place.

Cowperson

Well its really all conjecture (but fun and entertaining conjecture to me at least!). The fact is that the gender gap in China is miniscule, at less than one percent. It just seems to be much higher because of the enormous numbers that in effect.

Its the same as last week when the Chinese government cracked down on polluting 3000 polluting companies. In Alberta 3000 companies is a lot, over there its a drop in an enormous bucket.

I agree that India might overtake the Chinese, but both are poised to become economic powerhouses. The scariest thing in China (to me) is the piracy and disregard for information protection.

[Fozzie_DeBear]

Not sure if this link will work for everyone but is interesting

IIRC China historically had about 30% of the worlds GDP in the 1800-1900's, which shrunk to ~5% during the 1950-70's and has been creeping upwards dramatically again. China has historically been a global economic powerhouse it is simply regaining its former form...you can try this link

I read that it is estimated that China's GDP per Capita (at purchasing power parity...i.e. a value that normalizes the amount it costs to buy things in different countries) will overtake the US's by 2025ish...what was scarier was that they were expecting the absolute GDP per person for China to overtake the US's by 2050ish...

[Kent Brockman voice] I for one welcome our new mandarin overlords...

Hey Slava how are the Mandarin lessons going?

[Slava]

[quote=Fozzie_DeBear;884023]Not sure if this link will work for everyone but is interesting

IIRC China historically had about 30% of the worlds GDP in the 1800-1900's, which shrunk to ~5% during the 1950-70's and has been creeping upwards dramatically again. China has historically been a global economic powerhouse it is simply regaining its former form...you can try this link

I read that it is estimated that China's GDP per Capita (at purchasing power parity...i.e. a value that normalizes the amount it costs to buy things in different countries) will overtake the US's by 2025ish...what was scarier was that they were expecting the absolute GDP per person for China to overtake the US's by 2050ish...

[Kent Brockman voice] I for one welcome our new mandarin overlords...

Hey Slava how are the Mandarin lessons going?[/quote]


Well, its pretty slow progress, but progress nonetheless. I am still doing this on my own, but hopefully in next few months I can find a native speaker to try my skills out on! (Surprised that you remembered!)

[simmer2]

I just read China Inc. as well, and some of the figures in there were absolutely staggering. The thing that stood out the most for me were the high numbers of products being sent to China to manufacture in order to stay competitive in North America. The manufacturing industry of N.A, and to some parts the rest of the world, is quickly being taken over by China.

[Fozzie_DeBear]

Funny thing about that is that other Asian countries like Vietnam are starting to eat at the Chinese maufacturing contracts, also China is moving steadily up the innovation chain (instead of manufacturing gagdets they are designing and inventing them more and more). Add in the INSANE number of engineers and technologists they are creating and China should be around for a loong time...

...Unless Jin Q Public gets upset with the Communist party then watch things get interesting...

[Slava]

You're right on the money Fozzie; the number of educated and skilled workers of China are becoming the largest workforce that the world has ever known.

As far as Jin Q Public (which is hilarious by the way!) its scary. Its a well understood plot by dictatorial regimes to let the generation of unhappy disidents come out of the woodwork. Just when it looks like "this is the time" and more and more come to the protest the tanks roll in, and a whole generation of would be revolutionaries are crushed in one fell swoop. (See tiananmen square).