<<companies are likely to turn to other countries, such as Thailand or Malaysia for goods, rather than U.S. producers>>
I think this is precisely why the RMB will, at the end of day, devalue against the dollar, because China is not in the business of helping <<a different area>>
In any case, it is exceeding unlikely that the Malaysias and Thailands can be as competitive as inland China at any revaluation of RMB against the relevant currencies on the order a mere 5-25%.
I do not even believe the Malaysias and Thailands can be competitive against coastal China at a RMB revaluation of 5-25%.
On competitiveness, it is not just a matter of currency rates, and not even labour rates, but infrastructure, network, relationships, et cetera, so on and so forth, and so, the US Congress, together with the protectionist interest groups, are barking up the wrong tree, in the wrong forest, on the wrong planet, in the incorrect galaxy, and 25 years too late.
The Japanese Yen revaluation from 350 to the current 104 is not saving the likes of GM and F, and it is not as if the Japanese assembly line workers are getting paid less than the Detroit variety. |
