. November 11, 2006 SouthAmerica: The other day The New York Times had an article that mentioned James Kyngeâs latest book âChina Shakes the Worldâ. The book said that Mr. Kynge estimates that 90 percent of the manufactured products in China are in chronic oversupply...â â Then he goes on to explain the dynamics that is at work to create this oversupply of goods and almost no profit for the companies competing on this savage type of capitalist system. He also mentioned that âOf the $ 600 billion in foreign direct investments into China since 1978, most has come from within Asia.â The Financial Times (UK) website has further information and comments regarding that book at: http://www.ft.com/cms/s/4a5074e6-e408-11da-8ced-0000779e2340.html You also can read what Chris Patten had to say regarding this book at: http://www.ft.com/cms/s/e9275bec-bfba-11da-939f-0000779e2340.html ********* SouthAmerica: Reply to Libertad Thanks you. .
. November 11, 2006 SouthAmerica: Here is another interesting article regarding China which was published by Business Week magazine. *** BUSINESS WEEK - NOVEMBER 6, 2006 GLOBAL REPORT - âA Dragon In R&Dâ - China's labs may soon rival its powerhouse factoriesâand multinationals are flocking in for tech innovation As a young man, Zhang Xiaolin dreamed of becoming a top research scientist. But to reach that goal, the native of China's Anhui Province felt he had to leave his homeland. Now, after two decades in the U.S., he's back home again, and he couldn't be happier. Zhang will be heading up drugmaker AstraZeneca's Shanghai lab, where he says he expects "to do real innovative research." Adds his boss, James Ward-Lilley, president of AstraZeneca China: "In 20 years, where do you see new ideas coming from? A significant chunk will be from China." It's the year of innovation in China. Led by President Hu Jintao, the government is exhorting companies to transform China by focusing on the lab as well as the factory. To make that happen, Beijing has pledged to boost funding. In the late '90s, China spent less than 1% of gross domestic product on research and development. That figure is now up to 1.5%, but Hu wants to raise it to 2.5% by 2020 -- meaning outlays of $115 billion a year. "Everybody from government to individuals recognizes that [the Chinese] need to innovate," says Dan Goldstone, head of the Shanghai office for London consultant? WhatIf! The Innovation Co. Companies, both foreign and domestic, are taking up the challenge. From chipmaker Intel and search giant Google to AstraZeneca and Dow Chemical, multinationals are stepping up investment in R&D on the mainland. Chinese computer maker Lenovo Group and telecom equipment giant Huawei Technologies are pouring resources into cutting-edge technology. Manufacturers such as Chery Automobile are hiring top engineers to design cool new models. Biotech startups are offering experimental therapies unavailable or prohibited in the West. Shenzhen Beike Biotechnology Co., for instance, is implanting adult stem cells in patients to treat conditions such as autism, Lou Gehrig's disease, and strokes. While some foreigners might balk, "the whole Chinese government is promoting this," says Dr. Sean Hu, a 39-year-old Guiyang Medical College graduate who earned a PhD in Sweden, did a postdoc at University of British Columbia, and is now chairman of Beike. "That is the biggest advantage we have." Of course, China has a long way to go. While the Chinese invented gunpowder, paper, and the compass, since the decline of the Qing Dynasty China has taken a backseat not only to Western nations but also to Asian neighbors Japan and South Korea. In the eyes of many Westerners, the Chinese are outstanding manufacturers but lag behind such innovative Indian companies as software service provider Infosys Technologies Ltd. and drugmaker Ranbaxy Laboratories Ltd. Making matters worse, Chinese companies are often labeled copycats of their Western rivals. Cisco Systems Inc. sued Huawei in 2002 for allegedly stealing Cisco's router technology, and General Motors Corp. took Chery to court in 2004 for allegedly copying a GM design for Chery's popular QQ compact. In both cases, the companies settled out of court. China's schools, meanwhile, don't always turn out the kind of worker many companies want. "At Chinese universities, [students] aren't encouraged to take the initiative," says Frans Geidanus, chief technology officer for Asia Pacific for Dutch conglomerate Royal Philips Electronics. "They learn the facts, but they don't learn to be creative." The pace of change, though, is picking up. China accounted for 130,000 patent applications in 2004 (the most recent year for which figures are available). That makes it No. 5 globally, according to figures released on Oct. 16 by the World Intellectual Property Organization, a U.N. agency. Although China was still far behind No. 1 Japan (with 450,000 patents in 2004) and No. 2 U.S. (with 403,000), its 2004 patent applications were six times the number in 1995. China boosters are betting that the country can fast-track the makeover of its economy. "It's inevitable that [the mainland] will become an innovation center," says Vince Feng, Hong Kong-based managing director for General Atlantic, a U.S. private-equity fund that has invested $48 million in Beijing Internet company Oak Pacific Interactive. China has history on its side, Feng argues. "Whenever manufacturing is located in a country, innovation always follows," he says, pointing to the British, Americans, and Japanese as examples. "Manufacturing has migrated to China and is there to stay." INTRICATE FABRIC Tal Apparel Ltd. highlights the link between manufacturing and innovation. The Hong Kong clothing maker, with production and R&D operations on the mainland, has prospered in the past 50 years. But today, the $720 million company is trying to survive in a fiercely competitive industry by pioneering new fabrics such as cotton cashmere and washable wool, and it is working with a mainland partner to develop the textiles necessary for new products. "There's a lot more science than you think in making clothes," says Managing Director Harry N.S. Lee. China's health challenges also help to spur ingenuity. The country's status as an incubator of deadly viruses is a powerful motivator, says Yin Weidong, the 42-year-old founder of Beijing's Sinovac Biotech Ltd., the mainland's leading producer of vaccines. The Tangshan native studied infectious diseases in the 1980s as a doctor for China's Centers for Disease Control & Prevention. In 1992, Yin started the company that eventually became Sinovac and developed the country's first hepatitis A vaccine. More recently, Sinovac scientists helped other Chinese researchers develop a vaccine against SARS, the respiratory disease that spread across the mainland in 2003. "With hepatitis, there was a lot of information available, but SARS was completely new," says Yin. "We didn't even know the characteristics of the virus or if a vaccine could be made." The experience helped prepare Sinovac for its next challenge: an avian flu vaccine the company is developing. It's unclear whether the disease will spread worldwide, but in China it's a real threat that has killed 14 people, lending urgency to Sinovac's efforts. "If SARS and avian flu...become problems in the West, people will find that Sinovac is the company to talk to," says Yin. While foreigners might well benefit from China's innovation push in the event of an avian flu outbreak, mainland researchers are already gaining from increased contact with colleagues overseas. John Deng, 38, founder of chip designer Vimicro Corp., has a PhD from the University of California at Berkeley and worked for IBM before returning to China in 1999 and launching Vimicro, a successful designer of chips for PC cameras. Other Vimicro executives have PhDs from the U.S. or have worked there, and today the company has partnerships with Intel, Microsoft, and Texas Instruments. "You really need to be interacting with the Sonys, the Hewlett-Packards, and the IBMs to make sure your innovation is state-of-the-art," Deng says. China's universities are getting a helping hand from the multinationals, too. Not long ago, professors, strapped for funding, were abandoning school and entering the business world. There was even a popular expression for giving up on the ivory tower: "jumping into the sea." There's little need to bail anymore, says Tao Linmi, an associate professor in the department of computer science and technology at Tsinghua University. Tao's main project is a camera system that follows movements and gestures, automatically keeping an image in camera range. He's working with engineers from the Intel research center in Beijing and is collaborating with nearby R&D centers run by France Télécom and NEC. He says he's happy to see others join the crowd. "Google's research center just opened outside our gate," he says with a grin. "More research institutes mean more funding for us." Without foreign money, Tao says, his work wouldn't have advanced nearly as much as it has. "Five years ago, we usually published in Chinese journals," he says. "Now we are in international journals." Western companies are helping Chinese knowledge workers think more creatively. Nokia Corp, for instance, relies increasingly on Chinese engineers. The Beijing Product Creation Center is one of just four R&D labs for handsets that the Finnish phone maker operates worldwide. Running the Beijing lab, which opened in 2003, was difficult at first, says chief Steven P. Marcher. The engineers were very bright, he says, but they didn't know how to navigate a corporate culture that emphasized innovation. "They were always dependent on me telling them what to do," he recalls. So Marcher developed a training program to encourage Nokia's Beijing managers to "think for themselves." The cultural obstacles were daunting. "It's a completely new way of thinking compared to a Chinese company," says Marcher. "They are coming from a hierarchical setup to one where I am fully empowering my team to take control." The yearlong class, involving coaching and mentoring aimed at developing leadership skills, has produced impressive results, Marcher says. Last year, the Beijing center was the driving force behind four new Nokia models, which Marcher's Chinese engineers produced in 12 months -- a very short time by Nokia standards. "We broke all sorts of records," he says. And, he boasts, "everything was done from Beijing." .
Mardi Gras: Made In China trailer a 2 min 45 sec video that puts things in perspective http://video.google.com/videoplay?docid=946994874953638518&subtitle=on&pr=goog-sl
. November 17, 2006 SouthAmerica: Today when I was reading the enclosed article published on the latest issue of Business Week, various thoughts came to mind. The article raised the following question: âIndia is a boisterous democracy, while China is a single-party, command-and-control state. Which system is better at managing a complex economy, cultivating innovation, and delivering a prosperous future?â The article said: âChina's system gives it an edge over India, where opponents of economic reform have a strong voice. "A democracy changes its mind all the timeâ¦â That reminds me of what has happened in Brazil in the last 30 years â after the oil shock of the early 1970âs the military government in Brazil decided to bite the bullet, and they developed the ethanol industry in Brazil. Today Brazil is independent of foreign oil, and Brazil has developed the leading edge technologies regarding the global ethanol industry. The benefits to the Brazilian economy it is enormous today, because the military government of the 1970âs made a major decision at that time that would have a major impact in future of the Brazilian economy. Among the benefits are: clean air, reusable resources, independence from foreign oil, and so onâ¦. Brazil would not have achieved all these goals under a democratic system. The generals made some hard choices 30 years ago, and today the Brazilian economy is enjoying the benefits of the choices that they made long ago. One of the executives mentioned in that article said: "When you look at market economies, which are the richest?" he asked. "They are democracies." Regarding his comments two economies came to mind, Singapore and Chile, these two countries did relatively well under their different type of dictatorship system. In the other hand, many mainstream economists have claimed over the years that if a country adopts a free market capitalist system, under a democratic system, then the result would be economic growth and prosperity. But South American countries has proved these ideas wrong in the last 20 years â since country after country in South America became democratic, and all of them worked under a free market capitalist system, and the system has not work well for most South Americans. There are many lessons for the world to learn from what has happened in South America in the last 20 years. That is why some South American countries are going on different directions today including Bolivia, Ecuador, Venezuela, and so onâ¦. I have never been in India, but my perception is that the Indian economy is nothing to write home about â other than their pockets of leading edge software technology development. I wonder how much of Indiaâs prosperity today, still due to the systems installed by the British many years ago? But I am very impressed by the economic transformation that has been going on in China in the last two decades. ************* Business Week November 20, 2006 GLOBAL BUSINESS âThe Dragon's Way Or The Tiger's?â A spirited debate over the merits of directed vs. democratic economies China and India. Given their sheer scale, rapid growth, and increasing political heft, they often get lumped together in discussions of the future of the global economy. Yet they represent radically different development models: India is a boisterous democracy, while China is a single-party, command-and-control state. Which system is better at managing a complex economy, cultivating innovation, and delivering a prosperous future? That question triggered animated debate at BusinessWeek's 10th annual CEO Forum in Beijing on Nov. 1-3. The event drew more than 700 global executives as well as senior government officials from China, India, and beyond. The conference explored critical themes such as Asian corporate competitiveness, the rise of the region's marketing brands, and the disruptive impact of new digital media such as blogs and social networking Web sites. The India-China rivalry, though, remained just below the surface in almost every discussion both on the dais and in the hallways. VOICES OF DISSENT Ronnie C. Chan, chairman of Hong Kong's Hang Lung Properties Ltd., riled up Indian executives by suggesting that China's system gives it an edge over India, where opponents of economic reform have a strong voice. "A democracy changes its mind all the time," Chan said. That drew an immediate retort from Ajit Gulabchand, chairman of Hindustan Construction Co. "When you look at market economies, which are the richest?" he asked. "They are democracies." In an interview with BusinessWeek Editor-in-Chief Stephen J. Adler, former U.S. Federal Reserve Chairman Paul A. Volcker said China's political system and its attendant corporate and political corruption might cause trouble. "At some point, economic freedom ultimately clashes with a highly controlled political apparatus," he said. Still, Volcker conceded that the mainland's current system has managed to foster high-speed growth, and he predicted the yuan would eventually emerge as the dominant currency in Asia. For now, both systems seem capable of producing companies that will make their mark on the world stage. China Mobile Ltd., for instance, has nearly 300 million subscribers and a $177 billion market capitalization, making it the most highly valued telecom company in the world. It has made two acquisitions in Hong Kong and aims to bag more quarry abroad, especially in the Middle East, Asia, and Latin America. "Our target is to become a world-class company," said China Mobile Chairman Wang Jianzhou. With the likes of China Mobile, telecom gear maker Huawei Technologies, and India's Tata Steel on the prowl for acquisitions overseas, China and India "are reshaping the global economy," said Yuwa Hedrick-Wong, an economic adviser with MasterCard International. Can these two giants get along? Their rivalry is bound to intensify as India moves more into low-wage manufacturing, a Chinese specialty. Both must create 15 million new jobs every year just to keep their young people employed. China and India "are going to be competing for manufacturing jobs," said Professor Fan Gang, director of China's National Institute of Economic Research. While the economic competition may ultimately benefit both sides, he noted that "India's blue-collar wages are about half of China's." In other words, rapidly prospering China could find itself being undercut by lower-wage India. .
The South American countries had the extra challenge of trying to inject democracy into a Catholic Spanish culture. It will be interesting to see whether the various directions being experimented with can overcome the underlying issues that has created for SA. It does beg the question: if democracy doesn't solve the problems of a Spanish Colonial culture will it have any more luck in divided Islamic countries?
. Kiwi-trader: The South American countries had the extra challenge of trying to inject democracy into a Catholic Spanish culture. ⦠It does beg the question: if democracy doesn't solve the problems of a Spanish Colonial culture will it have any more luck in divided Islamic countries? ******** November 17, 2006 SouthAmerica: The French Revolution had a major impact in Brazilian history. And Brazil has been developed under the cultural influence of the Portuguese, French, Dutch, Africans (slaves), British, and Italian cultures. But the French and Italian cultural influence have had the most impact above all. Regarding your question: In my opinion, Democracy is not going to solve anything, but the right economic system has a better chance â even then it is not that simple. .
As the above posts state, a lot depends on the curtural background of an area. In Europe, often the equivalent of a theocracy existed for hundreds of years. Depending on "expectations" this may or may not resulted in maximum "happiness" but certainly did not and does not and will not result in progress. Does development and progress bring happiness? Well, it surely brings wealth, and that usually has a trickle-down effect. I'm in China just now, and the watchword here is not socialism, or capitalism or communism - its "development.!" The explosion of the mddle class is incredible. Are they happy? I'd say so, if you are able to work and are not a farmer. What is the best system? Certainly not pure democracy like California tried, not Florida with it's High Speed Train initiative or Class Size amendment. Recall that Jefferson is quoted as having said that the peope were not qualified to govern themselves. Thus Representative Government. Since we are involved in a great struggle between religeous fundamentalists willing to kill you in the name of God and theocracy and what the West calls democracy, we'd better get our goals straight. Most Christians (and Jews forever) have adapted to pluralism and (I think) 97% of Muslims have also. We need to make intolerance a true workwide crime and work to make this a cultural bias everwhere. China is doing quite well, thank you!
the only reason why ronnie chan said that is because he is a Hong Kong executive in Beijing and he's trying to kiss Beijing's ass. hong kong companies are notorious for having family controlled corporations. someone should ask him what's the democratic process at his company to replace him. sure, you can find examples of how a benevolent dictator did just as well as a democracy, but it is just a matter of time before the guy abuses his power or a not so benevolent dictator rises to power. a democracy protects the entire system into the future. china's economy is great right now, but how do you know the next person won't screw everything up? the world critisizes american democracy for electing Bush. but guess what? he can only stay in power for 8 years. that's the absolute maximum. now imagine you are in a country where no such democratic process exists. one bad apple makes it up there and the entire country is completely screwd for at least a few decades.
. November 17, 2006 SouthAmerica: I know that Americans like to make the connection between democracy, a free market economy, and capitalism â and if you adopt this formula the result is economic growth and prosperity. But I have a problem with these simplistic generalizations, since there are too many variables affecting the economy of most countries. And when people inject religion to the mix, then the problem becomes almost impossible for people to even discuss it in an intelligent manner. But regarding the subject of democracy - Robert Kaplan wrote an interesting article for âThe Atlantic Monthlyâ published in December 1997 that is very relevant today mainly when there is someone who has the crazy idea that he has to spread "Democracy" all over the world. I did read this article a number of times over the years, and I recommend that other people also read it. I hope you will get as much from this article as I did. I posted a copy of Robert Kaplan's article about "Democracy" on the following web site: http://discussions.pbs.org/viewtopic.pbs?t=24957&highlight=kaplan .
Excellent Commentary All....... It is very interesting this point of how people cannot govern themselves...and thus need elected officials to serve as their leadership...which in turn are given incredible subjective power... Thus the risk lies on whether or not these elected individuals are excellent and honest people... ................................................................................................ I fully disagree with giving a handful of people this amount of legal power ...that has been given ie. to the Bush Cheney fiasco team...etc... ................................................................................................ The game of musical chairs every few years ...does not allow for the certainty of long term projects...and being stuck with the same leadership can be incredibly damaging.....can you imagine the state of the US if Bush Cheney supposedly served 20 years ? If all voters would have simply read an accurate biography of each of these people they would have never voted for them...Instead..the US system only gave a two individual choice...whereby 99% of the voters just simply recalled what was remembered from the recent barrage of advertising to choose between two people...UTTER NONSENSE !!!!!!!! .................................................................................................... This is why that I think that the internet is going to be so important in governance.... Furthermore...the election process itself is all about who can buy the most TV time and sound bites with carefully worded and redundant messages....Is this the way to truly elect a qualified individual....??? ................................................................................................. What is logical is to form proper goals and achieve them...without special interests lobbying....corporate and wealthy people control tactics etc... ................................................................................................ Furthermore there should be no differentiated party system....There should be a directive effort to achieve the most important goals....and people should not be elected with TV clips and sound bytes.... .................................................................................................. The internet serves as a reliable source of information....and is an excellent collector of inputs.... Politics needs to be eliminated....Politics is nothing more than a huge biased struggle to acquire the rights of securing and spending tax money... The tax structure itself should be a simple consumption tax ie 10%...with no other taxes... .................................................................................................. Politics needs to be replaced by a centralized collection of the countrys needs...whereby a consumption tax pool of funds is distributed.. This idea of US style politics vying control of taxing and tax money is outdated.....and may or may not allow for important objectives to be accomplished... The current US system is UTTER NONSENSE.....and is certainly an impediment to long term objective achievement... ................................................................................................ This is not to say that any other country is collectively better.... What is true is that with the advent of the internet...globalization....etc...times are changing quickly with regards to information sharing...and thus governments of the future will reflect globalization ...and will most certainly not look like what is in place today....