China in the World Economics Essay Example | Topics and Well Written Essays - 3000 words

China in the World Economics - Essay Example So what can be the consequences of such a hard-core optimism Can China really beat the rest of the world economic and political superpowers The vast size is alluring. The power it can assimilate is thus threatening too. From being the largest coal producer in the world, along with things like cement and steel, China is one of the major contributor in cost cutting and low cost manufactured things that find their way almost everywhere in the world, like Wal-Mart. It is also the second largest consumer of energy in the world and thus the third largest importer of oil. One of the second largest holders of foreign-exchange reserves in dollars, China seems like the future of 21st century. WTO report on China demonstrated that it would supposedly produce more than half the world's textiles by the end of the decade.1 The CNN report also says that China: "has a permanent seat on the U.N. Security Council, it is an acknowledged nuclear power and it is one of only three nations capable of independently launching humans into space." China is undoubtedly a US rival and after the consecutive militant and destructive wars it has waged has paved the path for China a little too easily. The inward-looking communist state was opened up to Western economy and capitalist agenda when the 1970 US foreign policy included such an economic rapprochement with Mao Zedong. Thus it helped US in obtaining a pro-alliance support against the Soviet Union, who was their immediate problem then in 1972. Shanghai has now become one of the largest economic hub of China and extreme development is taking place everywhere at a speed rate that is quite not comfortable for other actors in the internatio nal system. The massive reserve for cheap labor is one of the many advantages of countries like China, and especially for China, who can have both labor and high skilled intellectuals at a very large quantity. China's industrialization is thus being driven from home but with the help of international actors like transnational corporations. They are outsourcing to China and exporting from there too, thereby increasing import. Bound up with the growth of mammoth discount retailers in Western markets, that are driving business like crazy particularly in the US, China is getting all the incentives for producing toys, shoes textiles and electric appliances for as less as possible but with durability and other advantages. In 2005 December Airbus made a motion in Beijing. The deal included something similar to what General Motors did in US. Apart from their intention to sell 150 passenger jets to China, which is worth a several euro billions, Airbus is also considering building an assembly line in China, its first ever production base anywhere outside Europe. Similarly General Motors is doing fine in China even after suffering huge loss at other international sites. China's economic growth is good news for U.S. exporters who can flood the market with cheap Chinese export goods and reap huge profits in the US. But this also has a flip side to it that is being faced by US policy makers. Since China is reputedly and uncomfortably almost negligent of WTO guidelines that often cannot be neglected by US businessmen thereby adding cost to their production, the Chinese business and working conditions are sometimes compromised and