The substantive part of Charlie’s latest reply points to several factors which he is convinced will “fundamentally” diminish the appeal of China as a market for foreign capital. Specifically, they are China's shrinking cheap labour pool, slowing pace of economic growth, and competition from homegrown capitalists, together with restrictions on foreign investment in China by both the US and PRC governments.
Perhaps, but this does not take into account that it is China’s vast and growing consumer market rather than its cheap labour and other resources which is increasingly attracting foreign exporters and investors. In this sense, the Chinese economy is beginning to more resemble the American one where an historically slow pace of economic growth and better paid workforce has not deterred foreign exporters and investors from seeking to tap into its lucrative consumer market. The question is whether the current situation - a more robust US economy and a sluggish Chinese one - is only a temporary interruption of an underlying historical trend or heralds a permanent shift away from China as a prime destination for foreign capital. Apart from the economic trajectory of each economy, much will depend on whether the US government will be able to successfully cut off trade with China, particular with respect to the high-end technology which it needs to secure its continued rise. An article in today’s Foreign Affairs registers ruling class uncertainty about the ability of US imperialism and its allies to successfully prosecute their economic war against China. "Export controls and sanctions are effective only if companies don’t pursue workarounds", say the authors, one of whom is Peter Orszag, a former Obama admnistration official and now head of Lazard, a leading investment bank. " Industrial policies and subsidies are effective only if companies respond to the incentives they are meant to create”, "Washington will have to rely on companies to adhere to the spirit of policies, rather than just the letter. Even if most companies comply with new rules at first, over time, some will find ways to get around restrictions and overcome hurdles...Governments can convey their intent to reduce foreign economic dependencies, but their means are limited. Subsidies and other financial breaks are too small to fully rewire embedded supply chains that were built over decades. And more extreme policies such as import bans risk shortages and price spikes, not to mention full-blown trade wars that could devastate entire sectors.” Full: https://www.foreignaffairs.com/united-states/geopolitics-c-suite?utm_medium=newsletters&utm_source=fatoday&utm_campaign=Geopolitics%20in%20the%20C-Suite&utm_content=20240311&utm_term=FA%20Today%20-%20112017 -=-=-=-=-=-=-=-=-=-=-=- Groups.io Links: You receive all messages sent to this group. View/Reply Online (#29377): https://groups.io/g/marxmail/message/29377 Mute This Topic: https://groups.io/mt/104830403/21656 -=-=- POSTING RULES & NOTES #1 YOU MUST clip all extraneous text when replying to a message. #2 This mail-list, like most, is publicly & permanently archived. #3 Subscribe and post under an alias if #2 is a concern. #4 Do not exceed five posts a day. -=-=- Group Owner: [email protected] Unsubscribe: https://groups.io/g/marxmail/leave/8674936/21656/1316126222/xyzzy [[email protected]] -=-=-=-=-=-=-=-=-=-=-=-
