Posted on 11/29/2004 6:56:37 PM PST by Happy2BMe
EU spells out trade threat from China
By Ambrose Evans-Pritchard in Brussels (Filed: 30/11/2004)
China's lightning advance into the production of cars, computers and high-tech industry poses a serious threat to Europe's economic base, according to a report by the European Commission.
Guenther Verheugen, the new enterprise and industry commissioner, said the EU must improve to avoid quick relegation down the world's economic league as Asia storms ahead on every front.
|
|
|
|
|
Once despised as low-cost producer of shoddy textiles and toys, China is now starting to match western technology, but at a far lower cost.
"China's active industrial policy is turning the country into a low-cost competitor in high-skill industries," said the EU's Competitiveness Report 2004.
"The growth of Chinese brand-name producers exploiting these advantages will become a major challenge to established multinationals and brand owners affecting to a large extent well-positioned EU-15 companies," the report said.
One of the most vulnerable targets is the German car industry, which is already in dire straits.
Illustrating the sharp deterioration, the EU's trade surplus with China has gone from surplus in 1995 to a €10,373billion deficit in 2002. China is now Europe's second biggest trade partner after the US.
The deficit is expected to be much higher in 2004 as the euro reaches historic highs against the Chinese yuan. The yuan is pegged artifically to the dollar. The effect is to give Chinese exporters a massive competitive boost against European firms, a situation that is unlikely to be tolerated much longer as economic growth stalls in the Germany and Italy.
The Commission blamed much of Europe's sluggish performance on suffocating red tape. It said the EU could raise overall GDP by 12pc through adopting an American-style "regulatory burden". So far, the East Europeans have also been hit hardest by China, as they tend to compete in the same sectors. The Hungarian electronics industry has lost market share steadily to Asian importers.
The 354-page report, mostly devoted to warning about the growing Asian threat, contends that China has harnessed all its energies on conquering high-tech markets, creating "national champions" - with protected home markets and cheap labour - designed to punch at global level.
"China's industrial policy has selectively attracted foreign direct investment in technology intensive industries in order to benefit from foreign technology and organisational know-how," said the report. Mr Verheugen said Europe needed to respond by spending far more money on research and development.
In a chapter on public sector employees, the report said Britain is acquiring a top-heavy structure with 18.8pc of the workforce now employed by the Government, compared with 11.1pc for Germany and 11pc for Holland. Only part of this is accounted for by the National Health Service.
Britain took 36pc of GDP in tax in 2002, compared with 40pc for Germany and 42pc for Italy.
" Plus they are aborting daughters all over the place."
Just wait until the Chicoms learn that they can be a cash crop to export to Saudi Arabia... in exchange for oil.
and they can thank clintoooon for all his help in giving them the technology etc...in return for beaucoup campaign bucks - illegal, but okay if a dim
You would think China has a load of oil under itself anyway.
Funny how Red China is now less socialistic than the European Union. ;-)
Thats insane thinking. If I have a company of 50 workers making...well...anything from electronics to toys and I have to pay my workers salarys and insurance and taxes which comes up to...I dunno, lets say $700,000 /year.
But I can make these products in India or China for HALF the labor costs and provide NO insurance and benefits then WHY in gods name would I make the products here in this country or Europe?
Yes, there is no reason you'd pay your workers more to make toys here instead of having them made in China. So what? There are certain things that we can make in this country, but which we can buy more cheaply overseas. We don't need to make those toys here, and those workers are better utilized producing something else that we can't buy more cheaply from China, like heavy equipment, airplanes or tall buildings.
Europe is in trouble. The fall of the dollar and the yuan, is going to be their down fall. Currently their economies have stopped growing, their products are overpriced and the quality of their products are crap.
Yep - with little gold stars....
| Wal-Mart's China inventory to hit US$18b this year |
||
| Posted by The Loan Arranger On News/Activism 11/29/2004 11:23:23 PM PST · 55 replies · 458+ views China Daily ^ | November 29, 2004 | Jiang Jingjing The world's largest retailer, Wal-Mart Stores Inc, says its inventory of stock produced in China is expected to hit US$18 billion this year, keeping the annual growth rate of over 20 per cent consistent over two years. The trend is expected to continue, company officials revealed. "We expect our procurement stock from China to continue to grow at a similar rate in line with Wal-Mart's growth worldwide, if not faster," said Lee Scott, the president and CEO (chief executive officer) of Wal-Mart. An unnamed company official also stated the firm will extend its procurement base from South China's Pearl River... |
||
""We expect our procurement stock from China to continue to grow at a similar rate in line with Wal-Mart's growth worldwide,"
Let them sell their cheap products overseas, not here.
[snip]
|
||
Wal-Mart denies everything.
You are correct, and almost nobody knows or cares.
In the particular case of cars, they already were in critical condition. Several weeks ago there was a post about GM's Opel operation in Germany that wanted to shut down some plants and consolidate, in an attempt to regain profitability.
German "worker rights" laws blocked the consolidation, claiming some workers would lose jobs. They mandated that Opel keep the existing operation going, virtually guaranteeing additional losses; protecting worker's "rights" to a job, regardless of the actual economic consequences to Opel
Slave wages or not, Opel was in critical condition, terminally ill, but the Germans were only interested in the worker. This simply made it far more difficult to "compete" with a lower cost producer.
While they may be "slave wages" to you, but I'd bet the Chinese workers don't agree. Government regulations and worker's rights universally raise prices, so any economy that doesn't "overburden" corporations will win in the long run.
We, of all people should have figured that out by now. Expecting corporate altruism is unrealistic, because self-sacrifice becomes suicide if fully implemented.
It takes some very special circumstances for one to be willing to die for the sake of others, and business relationships fail to meet that qualification.
The requirement for one to make (unilateral) sacrifices for others, is anti-freedom, and is a special form of slavery.
That requirement went out of vogue with the Aztecs (ultimate altruism), and later during the Civil War (coerced altruism)
One of the reasons that Euros want to sell weapons to China. To balance the dificit.
I have lawyer friends who deal with car manufacturer CEOs by way of handling their estate planning. This year they are all saying the only car company that has been profitable was TOYOTA.
So, yep, I believe the Germany story and I know it is bad.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.