Posted on 06/22/2002 4:17:34 PM PDT by maui_hawaii
A United States business survey showed a clear trend of investment toward China and away from Southeast Asia--partly because of corruption and protectionism.
[The other 85% portion is because China has never been ‘online’ before, and they are pinning their hopes on China actually being open to their services or products. It doesn’t mean they are abandoning SE Asia, or that they have ever made money in China. They are getting into place ‘just in case’. Instead of 5 Asian offices, they might have 8 of them, and instead of the extra 3 gong to SE Asia, they are going to be put in China.]
[Personally I think they are going to all move in with a gung ho attitude, then in 5 years, when it is time to close unprofitable offices, move out.]
The American Chambers of Commerce poll of members in Singapore, Malaysia, the Philippines and Thailand showed that half the companies planning to relocate were aiming at China and that 64% of U.S. companies planning expansion in the region expected to grow in China.
[Where is the other half going? As for the 64%, see the above…they are putting some money up, in hopes that in the future China will boom for them…]
The four AmChams represent some $60 billion in investment in the 10 countries in the Association of Southeast Asian Nations. AmCham Managing Director Nicholas de Boursac said dissatisfaction with corruption and protectionism was a consistent response from the four economies polled.
[So they are going to China? Go figure. China is the mack daddy of institutional corruption and protectionism.]
"The principal findings show a very strong, positive outlook for growth in the region," he said. "But they also highlight a key issue, that there are some serious matters some governments in Southeast Asia will have to address if they want to stem the transfer of foreign investment to China. This is particularly in relation to corruption issues, local protectionism and laws and regulations around the region.
[No laws in China to speak of… you can account however you please. There are few labor laws to foul up how you operate.
Its not saying there is no corruption in SE Asia at all…there is.
When they get to China they will find this: the ‘laws’ are only applicable about 40% of the time and only applied to those who don’t have guanxi with the local leaders.]
With the notable exception of Singapore, this was the very clear message." Corruption is also a problem in China but the survey showed that when overall opportunities are considered there is a clear trend to look toward China.
[In the end, the flow of capital towards China is only temporary. They can only open so many offices in China, after all, there are only so many corporations operating in Asia. After that comes the all-important accounting for the decision to move to China. We will see if it delivers to expectation. In a decade, after the ‘new’ wears off of China, and people get a dose of reality, they are not going to feel so bad about closing a few unprofitable offices around China and investing elsewhere…the real concern is about influxes of manufacturers going to China.]
Few laws in China see they are for the most part freer in "communist"( which it is no longer) China then here in the land of the free. With all the laws on the books here I bet I break 20 of them every time I walk down the street.
There is a good explaination for that...several factors...
Foreign investment in China. Foreign companies that set up shop in China are not fully 'online' until they are set up with IT. Hence they spend their US dollars (or Euros) in China on projects originally foreign to China...
This is particularly true with the manufacturers flocking to China. China has a comparative advantage in cheap labor...
In short, my assessment is that China's boom, and the 'boom' of the IT sector there is going to fed by our own money. China is not contributing very much new money at all, not in the grand scheme of things.
Also, the tide everywhere else is going out. Its getting low. Whereas with China, its just now coming in... we are on different schedules if you will...
WHY? we got plenty of lures here just ask hillery she reels in chinese all the time
There are a whole lot more ways to get far better returns than just single mindedly promoting China.
Things could change, for the better, but someone has to do it, which might be hard to a bunch of people who are already convinced...
Also, here is a link
"the tide everywhere else is going out. Its getting low. Whereas with China, its just now coming in..."Yes this is true but there are still a few things which remain unseen or thought of by many that I believe could very easily and quickly change that tide leaving China high and dry. Im not only referring to socioeconomics but also the way China is trying to manipulate mother nature with their three gorges dam. If that project backfires in their face as it very well could, it will destroy their economy for decades.
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