The Safely Sourcing China Blog

I recently came across this extract in a white paper written by Dr. Daniel Park, Associate Consultant – International Projects at B2B International, entitled “How to Research & Evaluate Outsourcing Opportunities in China“, and which I thought nicely encapsulated some useful and interesting facts about China, and its’ economic development. I recommend you go and read the complete article for yourselves. Please, see the link at the foot of this posting for directions to the article itself. Now, the article was written in 2007, but much of the data holds true today, and it’s worth noting that many of these data have now exceeded the 2007 levels. Moreover, the fact that China had massive USD reserves has been something of a saviour since the global credit crisis, as China has been able to bail out many who were beset by financial difficulties due to the crisis. Here are the main points Dr. Park made, although the article is far more extensive than this short extract:

• China is the world’s fastest-growing major economy – around 9% per year sustained over the past few years.
• China is the world’s third-largest trading economy – US$ 1000 billion per year in foreign trade value.
• The technological level of the Chinese economy is rising rapidly – Chinese growth is NOT based exclusively on utilization of cheap labour.
• China’s foreign exchange reserves exceed US$ 500 billion.
• China is fully accustomed to trading in world currencies – this is one reason why its dollar (and other hard currency) reserves are healthy.
• China is a member of the World Trade Organization.
• China’s population of 1.3 billion is becoming increasingly affluent.
• China has put a man in space; is a significant nuclear power; and some parts of its manufacturing industry compare favourably with the best in the world.
• China is the biggest spender on research and development after the United States and Japan.
• New foreign direct investment is running at about US$ 50 billion per year and is growing.
• Chinese expenditure on overseas mergers and acquisitions topped US$ 2 billion in 2003 and looks set to reach US$ 4 billion in 2007.
• China is taking steps to end the fixed relationship with the dollar and to allow exchange rates and interest rates to become market-determined.

Daniel Park, March 2007

About the author

Dr. Daniel Park qualified in economics at the University of Glasgow.  He has been associated with B2B International Ltd since its foundation, and has acted as adviser and consultant in many of the company’s international projects.  Since his first visit to South-East Asia in 1978 he has made over 60 business visits to Hong Kong/China.  Between 2004 and 2006 he served as a non-executive director of a major Hong Kong manufacturing company with facilities in China, employing some five thousand people and operating at 6-sigma standards for world markets. Source: www.b2binternational.com

Related Articles

• Upward pressure on the yuan returns (economist.com)
• How To Succeed With Your China Business. Well….Sorta. (chinalawblog.com)
• U.S.-China relations at a pivotal moment for both countries (seattletimes.nwsource.com)
• China Becomes More Choosy in Buying U.S. Debt (nytimes.com)
• Inside Asia: Why China Will Keep Investing Abroad (nytimes.com)
• Q+A: What’s Next For Google’s China Workers? (wired.com)
• The Next Big China Investment Trend: Outbound (seekingalpha.com)
• More foreign firms feel unwelcome in China (seattletimes.nwsource.com)
• Is Google right to end China censorship? (news.bbc.co.uk)
• Peter Scheer: If China Unplugs Google, it Will Be the First Time China’s People Know What They Aren’t Allowed To See (huffingtonpost.com)
• Flaherty to pressure China on yuan (cbc.ca)

Originally posted 2009-08-13 02:05:31. Republished by Blog Post Promoter

Popularity: 9%

Some Related Websites

• Gold breaks $1,100: Does It Matter? Last week, gold prices briefly touched $1,100/oz before settling just under that number.  Apparently the Indian government decided to sell US dollars and make a 200 ton gold purchase from the IMF, which created the spike in gold prices. Right now, the spot price for the yellow metal is $1,106.......
• Man Buys Police Website After Speeding Ticket [/caption] Nobody likes getting a speeding ticket. But when Brian McCrary, 33, received a speeding ticket in Bluff City, Tennessee, he didn't just complain, he bought the local police department's website and used it to complain. After receiving a $90 speeding ticket earlier this year for cruising through what he......
• Napa County Hike of the Napa River Ecological Reserve Location: This loop hike is located in the Napa River Ecological Reserve as part of the California Department of Fish and Game in Napa County The Hike: In the summer time, trails squeeze through a beautiful jungle of vegetation on this one mile loop hike that traces a tiny......
• What The Effects Are of A Rising Interest Rate In Terms Of Its Currency: Look At Australia Australia just became the first major central bank to raise its interest rate (today, October 6, 2009) since the beginning of the financial crisis of 2008-2009.  From 3.00%, it raised rates 25 basis points to 3.25%. So what?  What does this mean, you might be asking? Below I'll take a......
• China's surplus of sons This article is very articulate about the problem. This is a problem not just for China, but for the world. As a dear Chinese friend of mine said to me many years ago, China is making a mistake sending its best and brightest. I have two Chinese daughters and I......