WSJ.com - America Plays Fair. Does China?
Allen November 28th, 2003
Not sure if we can truly say we “play fair” when we start slapping import duties on “American-made bras”. Mind you, there are no American-made bras anymore.
A quote from the article:
We have been patient, but America’s patience is wearing thin. While China has made some progress in moving into compliance with its obligations under the WTO, we have seen a loss of momentum. The AmCham-China chose 14 benchmarks to test China’s WTO commitment performance. As of July 19, China had made good on two, had made some progress on seven, and had significant problems with the other five.
A flood of counterfeit products is being produced, consumed and exported by China. The Business Software Alliance estimates software piracy rates in China exceed 90% and it is reasonable to assume that the vast majority of the Chinese government is operating with pirated software. China’s state-run banks are another concern. China’s savings are trapped in a system of indentured capital. There is no economic justification for the loans extended to unprofitable businesses in China, and nonperforming loans are a form of state subsidy. According to some estimates, nonperforming loans account for as much as half of China’s lending portfolios.
Another blog entry (should be above this one) addresses issues of a possible slow-down in the Chinese economy. Lots of inefficient companies who are “chasing the smart money”.
I remember reading another hard-copy article about Chinese companies who are suggesting that companies setting up shop in China should not design efficient systems. The idea that Chinese workers are paid so cheap that it’s not worth the effort to design such systems.
More comments on this sort of activity later. I’ve been listening to Lean Thinking and they have a lot to say about overseas shipments of goods and moota.