Hi Yiwu - Most cars sold in Austraila, Brazil, Argentina, Mexico, Spain and many other countries are either made abroad or made in foreign owned plants. This is a long way from unprecedented. Swedens car industry started by assembling kits of foreign cars, Domestic manufacture such a Saab, developed later.
China's choice of the FDI / tech transfer path has resulted in enormous rapid economic growth, and the vast majority of multinational corporations willing to lobby for trade policies favorable to China. Contrast with India, which pushed away, prohibited, over regulated and generally been unwelcome about FDI. Politcians feel pretty free to bash India about outsourcing.
The present results speak for themselves. Or you can look at the extensive criticism from Indians contrasting Indias' policy with Chinas'.
Let's say you are the CEO of a multinational consumer goods company, and 30% of your profits are due to the low costs and efficentcy of your China based factories, and another 15% due to the low cost sub assemblies for product assembled outside China. China may be only 5% of your end product demand, but that is growing 15% per year, and was a large part of your 5% worldwide revenue growth.
Now who has colonized who ?
And by the way, after getting a bunch of hassel from India, and demands on limiting ownership, and loads of other S***
where do you India will be on the list for new plants ?
Yes they will get call centers and tech support and some R&D because they speak English, are bright, educated and cheap.
But put $300 million USD into a power plant of car factory or semiconductor fab ? No way.
I think it my be a bit early to start worrying about the hollowing out of industry in China... |
