Patent application alone do not translate to escaping any income trap. If that is the case Taiwan should have been a high income economy long ago, it is not. There's plenty of other economic factors that will determine a countries wealth. To be perfectly honest, China will not have escaped the middle income trap by 2035, or 2050, but it is still possible for a country like Taiwan to do so riding on the back of China's economic growth. Unless there is some massive revolution and innovation in technologies especially ones that will reduce our dependence on fossil fuels completely, China will never escape the middle income trap. Can you imagine 2 billion Chinese and Indians owning 2 cars each, sorry not going to happen ever without a massive technological leap, commercial patents alone won't do it. Besides that point you don't really need to give much credence to such indicators, wealth is just a matter of perception, a better indicator would be those used by Bhutan to measure your gross national happiness, i.e do you have enough to eat, are you living a healthy sustainable life style, are you having a good emotional quality. If i am an optimist and a politician, I did rather have India or China's problem honestly than Japan's problem despite it being more complicated in multitude and the fact that both countries will never reach high income in the foreseeable future, so patents be damn, this thread is another one of those my **** is bigger than yours troll thread.
I disagree. I think China is already showing it is escaping the "middle income" trap by exporting commercial aircraft, cars, and becoming bigger than Exxon.
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China sells 40 ARJ-21-700 regional aircraft to Indonesia for $1.2 billion
Indonesia buys 40 ARJ-21-700 aircraft for $1.2 billion. Look below the windows at the front of the fuselage for the ARJ-21 logo.
??ARJ-21???????? ??????40?_????_???
"民航资源网2012年2月24日消息：印度尼西亚一名航空官员20日表示，印尼鸽航（Merpati Nusantara Airlines）将通过购买中国的ARJ21-700飞机来拓展其机队规模。印尼鸽航总裁萨尔佐诺（Sardjono Jhony Tjitrokusumo）表示，在印度尼西亚企业部长余世甘（Dahlan Iskan）的见证下，14日鸽航签署了购买40架ARJ21-700飞机的谅解备忘录。ARJ21-700支线客机可搭载100人，约单价3000万美元。目前，鸽航共运营有35架各类型飞机"
Translation:
"2012.02.24 Indonesian official indicated Merpati Nusantara Airlines had ordered China's new ARJ21-700 aircraft to expand their fleet size. Mr Sardjono Jhony Tjitrokusumo (CEO of Merpati Nusantara Airlines) had signed the agreement with China Aviation Import & Export Corporation to buy 40 ARJ21-700 regional aircraft.
ARJ21-700 aircraft can carry 100 passengers. The unit price is approximately $30 million."
[Note: Thank you to Mpleio for the newslink and translation.]
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In Latin America, Chinese cars are gaining buyers - latimes.com
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In Latin America, Chinese cars are gaining buyers
Chinese brands, with their low prices, are selling like hot cakes as Latin America's consumer class expands amid rising incomes.
Cars made by Chinese company JAC Motors are on display at a dealership in Rio de Janeiro. The low cost of Chinese cars is winning over buyers in Latin America. (Antonio Scorza / AFP/Getty Images / September 16, 2011)
By Adriana Leon and Chris Kraul, Los Angeles Times
February 9, 2012, 5:51 p.m.
Reporting from Lima, Peru, and Bogota, Colombia—
At first, Lima taxi driver Mario Segura was disgusted by the thought of buying a Chinese-made car. He had doubts about the vehicles' durability, service and resale value.
But favorable word of mouth, assurances that spare parts are plentiful and, of course, unbelievably low prices won him over.
"Little by little, I heard favorable comments," said Segura, speaking in a Chery showroom in the Surquillo district. He had just plunked down $12,000 in cash for a new Fullwin XR sedan, half the cost, he said, of a comparable Fiat or Renault. "It took a long time to decide, but I'm risking it."
So is Luis Luna, a doctor just back in Lima after working for several years in Argentina. He had planned on buying a secondhand Japanese car. Until, that is, he noticed billboards touting low-priced Chinese brands and listened as his relatives insisted that he kick tires at a JAC dealership, one of dozens of Chinese brands sold here.
"We realized for the same money that we'd pay for a crummy secondhand car that inspired no confidence, we could have a brand-new Chinese car with a two-year warranty," Luna said as he finished paperwork on his new $16,000 JAC B-Cross family wagon. "I'm totally convinced this is the right decision."
Similar buyer testimonials can be heard across Latin America these days, where Chinese cars with unfamiliar brand names like Great Wall, JAC, Brilliance and Sinotruk are selling like hot cakes. Chinese cars were introduced in Peru in 2006 and now one in six new cars sold here is a Chinese make.
There are no fewer than 90 Chinese car manufacturers to choose from, according to the trade group Automobile Assn. of Peru. The Chinese auto industry has yet to undergo the winnowing process that, over a century of competition, has reduced the U.S. car industry to three big players.
The Chinese brands' main selling point is, of course, price: New Chinese cars typically sell for half to two-thirds the cost of a comparable European, U.S. or Japanese vehicle, said Guido Vildozo, an auto industry expert with consultants IHS Automotive in Lexington, Mass.
"What makes Chinese cars so much cheaper? Start with labor," Vildozo said, noting that a typical Chinese autoworker makes $300 to $400 a month, a fraction of the $2,000 to $3,000 in wages that Mexican workers make or the $5,000 to $7,000 a month that U.S. auto workers average.
Another price advantage, said Jian Sun, a partner with AT Kearney business consultants in Shanghai, stems from the "reverse engineering," or design and mechanical imitation, that many Chinese carmakers use in competing models to save them the expense of designing new models from scratch.
Chinese manufacturers are entering the market as Latin American incomes are rising to unprecedented levels, flush from the decade-long global commodities boom filtering down to an expanding consumer class.
Augusto de la Torre, chief Latin America economist at the World Bank, said the region's middle class now encompasses 30% of its population of 570 million, up from 20% in 2002.
In Colombia, where the economy is thriving on global sales of its oil, coal, coffee and bananas, the increase in disposable income is especially dramatic. Bank of Bogota economist Camilo Perez said economic output per capita has nearly doubled in five years, to $6,700 last year from the $3,400 average in 2006.
So it comes as no surprise that car sales are accelerating. New units sold last year in Colombia totaled 325,000, a 28% increase from 2010. New car sales in Peru totaled more than 100,000 last year, up 26% from the previous year.
According to Scotiabank, Brazil's car sales will grow to 2.8 million in 2012, up 4% from last year, but in a much larger population base than those of its neighbors.
The expanding new-car market is what attracted Chinese automakers, who see Latin America as a proving ground for its plan to conquer the world car market in coming decades. According to AT Kearney, China exported 800,000 cars last year but hopes to boost that number to 2 million by 2015 and to 3 million by 2020.
The Latin focus is also explained, AT Kearney's Jian said, by the fact that Chinese manufacturers are not yet prepared to tackle the U.S. and European markets, which are more demanding in quality and emissions standards. The competition is less intense and the regulatory restrictions are lower in emerging markets, he said. China and these regions share similar road conditions, emission controls and safety standards.
(The domestic Chinese car market, where sales last year totaled about 18 million vehicles, is the largest in the world, far surpassing that of the U.S., where about 12.8 million new cars and trucks were sold in 2011.)
Many buyers, like Antonio Benevides, a 26-year-old theme park worker in Bogota, are first-time owners. In early December, he bought a new Chery QQ model for $9,000, two-thirds the cost of a comparable Renault he had considered.
"That difference in price is what put a new car within my reach for the first time," Benevides said as he drove his car off the dealership lot near Bogota's international airport. "I've heard they hold together well, that they are cheap to operate and, as you can see, they are not bad looking."
Special correspondents Leon reported from Lima and Kraul from Bogota."
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PetroChina surpasses Exxon in oil production - Boston.com
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Chinese firm surpasses Exxon in oil production
By Chris Kahn
AP Energy Writer / March 29, 2012
FILE - In this Thursday, Jan. 28, 2010 file photo, a worker walks past tanks at a Petrochina storage base in Suining, in southwest China's Sichuan province. A big shift is happening in Big Oil: an American giant now ranks second to a Chinese upstart. Exxon Mobil is pumping less oil than PetroChina, a company formed just 13 years ago by the Chinese government to better compete for the world's oil and natural gas. On March 29, 2012, the shift is expected to become official when the Beijing company announces that it produced more crude last year than its 130-year-old Texas rival. (AP Photo)
NEW YORK—A big shift is happening in Big Oil: An American giant now ranks behind a Chinese upstart.
Exxon Mobil is no longer the world's biggest publicly traded producer of oil. For the first time, that distinction belongs to a 13-year-old Chinese company called PetroChina. The Beijing company was created by the Chinese government to secure more oil for that nation's booming economy.
PetroChina announced Thursday that it pumped 2.4 million barrels a day last year, surpassing Exxon by 100,000. The company has grown rapidly over the last decade by squeezing more from China's aging oil fields and outspending Western companies to acquire more petroleum reserves in places like Canada, Iraq and Qatar. It's motivated by a need to lock up as much oil as possible.
The company's output increased 3.3 percent in 2011 while Exxon's fell 5 percent. Exxon's oil production also fell behind Rosneft, the Russian energy company.
PetroChina's rise highlights a fundamental difference in how the largest petroleum companies plan to supply the world as new deposits become tougher to find and more expensive to produce.
Every major oil company has aggressively pursued new finds to replace their current wells. But analysts say Western oil firms like Exxon Mobil have been more conservative than the Chinese, mindful of their bottom line and investor returns. With oil prices up 19 percent in 2011, they still made money without increasing production.
PetroChina Co. Ltd. has a different mission. The Chinese government owns 86 percent of its stock and the nation uses nearly every drop of oil PetroChina pumps. Its appetite for gasoline and other petroleum products is projected to double between 2010 and 2035.
"There's a lot of anxiety in China about the energy question," says energy historian Dan Yergin. "It's just growing so fast."
While PetroChina sits atop other publicly traded companies in oil production, it falls well short of national oil companies like Saudi Aramco, which produces nearly 8 million barrels a day. And Exxon is still the biggest publicly traded energy company when counting combined output of oil and natural gas. PetroChina ranks third behind Exxon and BP in total output of oil and natural gas.
PetroChina is looking to build on its momentum in 2012.
"We must push ahead," PetroChina chairman Jiang Jiemin said in January.
PetroChina has grown by pumping everything it can from reserves in China, estimated to contain more than 6.5 billion barrels. It drilled thousands of oil wells across vast stretches of the nation's northern grasslands. Some of those fields are ancient by industry standards, dating close to the beginning of China's communist government in the 1950s.
The commitment to aging fields distinguishes PetroChina from its biggest Western rivals. Exxon and other major oil companies typically sell their aging, low-performing fields, or they put them out of commission.
PetroChina also has been on a buying spree, acquiring new reserves in Iraq, Australia, Africa, Qatar and Canada. Since 2010, its acquisitions have totaled $7 billion, about twice as much as Exxon, according to data provider Dealogic.
Several other Chinese companies have become deal makers around the globe as well. Total acquisitions by Chinese energy firms jumped from less than $2 billion between 2002 and 2003 to nearly $48 billion in 2009 and 2010, according to the International Energy Agency. More times than not, the companies are paying above the industry average to get those deals done.
It's making some in the West nervous.
In 2005, for example, CNOOC Ltd., a company mostly owned by the Chinese government tried to buy American oil producer Unocal. U.S. lawmakers worked to block the deal, asking President Bush to investigate the role the Chinese central government played in the process. Chevron Corp. eventually bought Unocal for $17.3 billion.
"There's a resistance to Chinese investment in (U.S.) oil and gas," Morningstar analyst Robert Bellinski says. "It's like how Japan was to us in the 1980s. People think they're going to take us over. They're going to buy all of our resources."
That's unlikely to happen. It doesn't make economic sense to export oil away from the world's largest oil consumer.
But the Chinese could make it tougher for Big Oil to generate returns for their shareholders. China's oil companies have been willing to outspend everyone and that drives up the price of fields and makes it more expensive for everyone to expand.
"You now have to outbid them," says Argus Research analyst Phil Weiss. "If you can't, you're going to have access to fewer assets."
Longer term, Chinese expansion globally will bring benefits to the U.S. and other economies. By developing as many oil wells as possible -- especially in Africa, Iraq and other politically unstable regions -- China will help expand supply.
"Frankly, the more risk-hungry producers there are, the more oil will be on the market, and the cheaper prices are," says Michael Levi, an energy policy expert at the Council on Foreign Relations.
Despite its swift expansion, PetroChina and other Chinese companies still have much to prove to investors, analysts say.
PetroChina's parent, China National Petroleum Corp., for example, has spent millions of dollars in Sudan to provide highways, medical facilities and shuttle buses for the elderly. Oil companies typically don't do that. All of that increases the cost of business and minimizes the returns for shareholders.
In 2009 and 2010, PetroChina's profit margins for its exploration and production business were only about two-thirds that of Exxon Mobil's. Its stock price has climbed less than 1 percent, in the past year, compared with a 3.7 percent rise in the stock of Exxon Mobil Corp.
"You have to ask yourself: What is the purpose of PetroChina?" Bellinski says. 'It is to fuel China. That's it. Although they're a public company, I'm very skeptical that they have any interest in shareholder value creation.'"
