Rising Dragon
Here’s a headline that caught my eye: “Execs Fear Competition From China“. It would appear that western business leaders are figuring out what I predicted months ago. Chinese businesses are using the massive amounts of foreign direct investments to jump start not only their economy, but their global competitiveness.
China has rapidly transformed itself from a convenient source of low-cost labour to a source of global corporate power-houses, with low cost production, government support and a lack of strict IP controls cited by execs as key advantages for business in the country.
Add to this the shear size of China and its unique advantages, and one can easily envision an emerging economic superpower in the Middle Kingdom. Today the communist party is pushing a national policy of English as a second language. However, I think it would be wise for western business professionals to focus on making Mandarin their second language.
Isn’t it eerie when the rest of the world picks up on what you predicted? What do you predict Western business leaders will do to face this new challenge?
Honestly, I expect Western businesses to “follow the money”. MNC’s are already starting to eliminate the Dollar in their receivables in favor of more stable currencies. “Natural Hedging” will encourage them to invest in countries which use the currencies they deal in, and as the Dollar is becoming more unpopular, less capital investments will take place in the US.
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