Trapped in the China Train Wreck?
Posted on Sun, Mar. 06, 2005
BUSINESS BOOK
Author links Wal-Mart, China
By Cecil Johnson
Knight Ridder
Anyone still wondering why Wal-Mart doesn't play the made-in-America card in its marketing any longer can stop wondering. "China Inc.," business journalist and former commodities trader Ted C. Fishman's treatise, lays out in depth that and other effects of the giant Asian dragon's great economic uncoiling.
"Wal-Mart's growth as an economic force is inseparable from China's rise as a manufacturing giant," he writes. "No company in the world has embraced China's potential more vigorously than Wal-Mart, and no company has been a bigger catalyst in pushing American, European, and Japanese manufacturers to China."
Fishman writes that Chinese factories are the most important and fastest-growing sources for Wal-Mart; in 2003 the company bought 15 billion in goods from Chinese suppliers. Fishman says 10 percent to 13 percent of China's exports to the United States winds up at Wal-Mart. He cites a Washington Post article that says "80 percent of the six thousand factories in Wal-Mart's worldwide database of suppliers are in China. ... If Wal-Mart were a nation, it would be China's fifth-largest export market, ahead of Germany and Great Britain." Wal-Mart has 560 buyers in China.
Wal-Mart is the world's largest company - bigger than Exxon Mobil, General Electric or General Motors - and it sells more goods every year than Target, Sears, Kmart, J.C. Penney, Safeway and Kroger combined. Its trade with and in China, Fishman says, amounts to 1.5 percent of that country's gross domestic product.
"China Inc.," however, explicates more about China's mushrooming economic importance than Wal-Mart. Fishman explains why thousands of American, European and Asian companies are transferring manufacturing and service operations to China, what the Chinese government and business sectors are doing to attract them, which forces compel them to take the capitalist road and which developments in China portend for the global economy.
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