China capturing Pakistans export market to Australia

[croptikal]

This decade belongs to China, so to speak.

And this is supposed to be asian century, so the next decade may belong to India because Japan's turn is already over.

 

[croptikal]

Due to cheap chinese goods local home grown small industries have had to face a lot its time we support our local producers not just relying on cheap chinese stuff just coz its cheap,note most of the stuff lack quality.
its like cheap= not reliable
a little pricey with good quality and locally made

This is the best post on the thread. Most posters have suggested that Chinese are making a better product and hence conquering new markets(even those of its so-called ally Pakistan). This not a complete truth. The fact is that mostly Chinese goods are successful because of its cost, though they are of much lower grade in terms of quality.

 

[ajpirzada]

wats the angry face for?
if we want the market, we will have to be more competitive. simple as that

 

[shchinese]

let's don't get this misled by some cheap article, a single question solves all problems/concerns here: with the presence of China, whether Pakistan's economy is better off?

or we can put it in this way:

if Pakistan need to pick only one neighbor, whether you want China or India to sit next to you?

 

[k7x]

well it all ends up in $ and ROI for the investors. If these investors are convinced that they will get a Return of investment in country Y than country x ; they will fly to country Y in no time.

China at present gaurentees that by
1. no Trade union --- less labour unrest
2. Investor freindly labour Law
3. High curruption --- well this is absolute necessity for a good economy
4. Excellent infrastructre

and the result is higer margin; which gives lower price ; which gives better profit which attracts more investments

---------------------------------------------------
But there is a catch.

China is currently worlds factory . And it is not the design house yet.

if it has to be wrold leader it should be design house cum factory.

it is a long way to go to get that point.

in the mean time; a better Pakistan with an excellent infrastruce and all the above attribute can make the same thing what china has done..

but it is very hard my friends. since you have democracy; it hampers any rapid development

 

[TruthSeeker]

China definitely has advantages over many developing nations because of the intelligence (learning ability), pragmatism and low wage rates of its workforce. But it also benefits by artificially maintaining a low value of the yuan relative to other world currencies. It does this by pegging the yuan to the US$ and holding very large amounts (trillions) of foreign currency reserves in dollars. This is working for China but it does link the US and Chinese economies together as never before in history. As a result, China cannot escape from economic turmoil in the USA that might cause high inflation. The competitors of China would be better off if China allowed its yuan to appreciate against the US dollar.

 

[EjazR]

The main imbalance is China is not opening up its economy as other countries are doing. With such a huge population, China should hae had a huge consumer industry, but it doesn't. In fact even Bangladesh has a bigger percentage of consumer/service industry than China. While Chinese have a bigger manufacturing base.

If China wants to continue to grow, they have to open up the consumer market to foreigners and let the yuan float based on the market value

 

[aimarraul]

If China wants to continue to grow, they have to open up the consumer market to foreigners and let the yuan float based on the market value

CCP realised these problems ten years ago,but we have to build good security system first,if yuan appreciate too fast before our industrial transformation complete,it will hurt the interest of those poor people,
sure we can also let the yuan float based on the market value and allow those foreign capital control it,Yuan will probably rise two times more than current exchange in very short time,but we will also repeat the same mistake as japan,and that will be real unsustainable ,U.S could stop the rising of japan,but china is totally different case that they have no answer

Hong Kong chosen to start RMB settlement trial

 

[jeypore]

Competition will bring more quality and development, no problem.

Isn't that a major problem, how is Pakistan competitive? It is so lagged behind other problems of islamic fundamentalists, what do you think the politicians are thinking about? Economics or fixing there own country.

It's funny that you are dreaming about competition, where Pakistan is no where close to competativeness anyways.. Wish you luck in your aspirations!!!!

Ps. Work hard in that direction, and you will see some results, but fix the current problems first.

 

[shchinese]

The main imbalance is China is not opening up its economy as other countries are doing. With such a huge population, China should hae had a huge consumer industry, but it doesn't. In fact even Bangladesh has a bigger percentage of consumer/service industry than China. While Chinese have a bigger manufacturing base.

If China wants to continue to grow, they have to open up the consumer market to foreigners and let the yuan float based on the market value

are you suggesting the economy of Bangladesh is more healthy? or the lives of people in Bangladesh is better off?

trust me, when developing a real service sector, you need a strong industrial foundation. For countries like india and Bangladesh, its agriculture and industry generate comparable GDP to the nation, it only means these nations have not completed industrialization yet.

let's be honest on this, do you really believe india and Bangladesh are industrialized nations?

 

[shchinese]

China definitely has advantages over many developing nations because of the intelligence (learning ability), pragmatism and low wage rates of its workforce. But it also benefits by artificially maintaining a low value of the yuan relative to other world currencies. It does this by pegging the yuan to the US$ and holding very large amounts (trillions) of foreign currency reserves in dollars. This is working for China but it does link the US and Chinese economies together as never before in history. As a result, China cannot escape from economic turmoil in the USA that might cause high inflation. The competitors of China would be better off if China allowed its yuan to appreciate against the US dollar.

I acknowledge the facts that in terms of the development of China's financial systems, including a real floating exchange rate of our currency, there is a VERY VERY long way to go.

If you look at the whole financial system, it is like a crap. Shanghai wants to become the global hub for financial services, but it couldn't achieve that. There are some news reports that Shanghai lacks 1 MILLION professional financial services workers to realize the above goal.

So let's be clear about that - we lack experience, we don't have enough well educated and skilled people to make things right.

now if you look at the Yuan issue, it would not be difficult to see the motivation behind the fixed rate thing - we don't have the experience and knowledge to maintain such a floating rate and make sure the stability of the economy.

 

[oct605032048]

Since 1978 China is openning is door to the world.
The average import tax of China is lees than 10%, and for goods made in Pakistan the tax rate will be cut to about 5% after 1.1. 2010.

 

[ziczacs]

GDP per captia in Pakistan is about 1/3 of China, it means lower labour cost.

I'm curious why our Pakistani friends fail to export cheaper products than those Made in China ?

List of countries by GDP (nominal) per capita - Wikipedia, the free encyclopedia

 

[Renegade]

China maintains a fixed exchange rate for its currency, which gives its exports an artificial advantage over countries with floting currencies. While the value of a floting curreny is determined by demand and supply, a fixed currency like that of China's is immune to this phenomenon and ends up subsidizing Chinese exports.

If Chinese exports are beating other countries it is mainly beacuse of this factor, quality is not such a major play here. While countries in the west are rich enough to absorbe this shock, developing countries the world over end up being the loosers - loosing markets to artificial competition.

Our Pakistani friends here are just too touchy on the China factor here, to have the guts to call a spade a spade.

 

[grey boy 2]

Yuan appreciation is not favorable for the world economy? | Ecommerce Journal December 7, 2009

The research institute of China's Ministry of Commerce published an essay that touched upon the issue of yuan appreciation and its adverse effects on the global economy. The essay notes that increasing the value of the Chinese currency would hurt rather than help world economic recovery.

"Forcing the renminbi to appreciate would undoubtedly be unfavorable for the Chinese economy, and likewise do no good for the sustained recovery of the world economy," said the essay, which appeared in the Chinese-language International Business Daily, an official newspaper of the Ministry of Commerce.

China's "renminbi exchange rate policy is appropriate and successful," it added.

"The (economic) recovery remains fragile and under these circumstances, appreciation would present major risks for the Chinese economy."

Meantime, Yu Yongding, an economist and former central bank adviser, in separate comments on Monday said that China should adjust its economic structure, including lowering its dependence on exports, as it faces the possibility that a growing U.S. current account deficit will lead to dollar depreciation and rising U.S. protectionism.

"Lowering the current account surplus is in line with China's own interests," Yu was quoted as saying at a weekend forum.

Still, the Ministry of Commerce institute insists that the yuan should not grow otherwise it would sap China's economic recovery by dampening foreign investment, cutting into business profits and job growth, and threatening to increase financial deficits and bad bank loans.

China's cheap goods have helped foreign consumers facing hard times, and raising the value of the yuan could hinder global economic recovery, said the think-tank.

"If Chinese production costs rose due to shifts in the (yuan) exchange rate, then naturally the United States would expand its imports from other developing countries," it said, "and the trade balance as a whole would not improve."