China's greatest asset to growth was its cheap manufacturing base that drew investment and interest in low cost alternatives. Globalization is stripping China of this advantage as other nations find their own competitive ground. China will need to adjust its economic strategy to help it find sustainable growth that doesn't rely heavily on foreign capital accumulation. Changing their investment policies and encouraging long-term solutions will be more helpful than short-term strategies in the next phase of China's economic life. China has been known as a great place to produce products because of a business friendly government, lower labor costs, and less environmental restrictions. This cheaper cost alternatives encouraged foreign companies to outsource simple manufacturing of parts to Chinese companies. This create a net influx of foreign dollars that fuel growth over the past couple of decades. The country's production capacity was based on its ability to partne
Showing posts with the label international commerce
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According to a report by China's National Development and Reform Commission and the Academy of Macroeconomic Research the country wasted nearly $6.8 trillion dollars in investment money (as cited in Business Insider ). Half of the investment money between 2009 and 2013 was wasted in ineffective construction projects that were supposed to improve the nation’s infrastructure to spur growth. A sign of major corruption or just mismanagement? Low interest rates can spur all types of investments and these are beneficial for national growth. There is always a cost with such stimulus if infrastructure investments in the provinces don't actually lead to growth or simply don't have a return on their investment. Local government makes decisions on where and how to spend resources but continued poor investments can damage growth. As with any large project it is possible that money is not spent in the most effective places to obtain a significant return on investment.
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Global marketing is a new business necessity as global integration leaves few localities untouched by outside market influence. Developing global managers and moving them into organizations where they are most useful can help in the development of stronger marketing decisions. Research by Moeller and Harvey (2011) highlight the need to develop the “global mindset” among managers and use that mindset to compete on international markets. Before discussing the benefits of globally oriented managers it is first beneficial to understand what the “global mindset” is. According to Rhinesmith, the global mindset is, “ the ability to scan the world from a broad perspective always looking for unexpected trends and opportunities that may constitute a threat or an opportunity to achieve personal, professional or organizational objectives ” (1993, p. 24). They are able to overview the global environment and understand larger trends and move to specific knowledge adaptation when necessar