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US Congress committee approves China sanctions bill

No one is recommending Pakistan replace indigenously produced goods with Chinese made goods. What do you mean "economic reforms" in the scenario you cited?


It is just another scenario. We start to depend on China for goods--what about the local industry?

If we don't shift the jobs as we did not, we are already paying higher prices--no??

^^Pakistan
 
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Rightly said. Unfortunately politicians here are eagerer for ideological purity than to worry the future of this country, by launching one crusade after another.

Chinese government seems to have largely put aside ideological campaign and concentrates on development... :cheers:

There is no single example like China. From dust to concrete in few decades, a story to remember.

Did you check that LRT idea--LRT, am I right?

That is what I call innovation!!!
 
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Even if manufacturing jobs goes back to the U.S they'll not necessarily goes to Americans. U.S has subsidies and other protectionist policy on agriculture sectors, look at how many illegal immigrants those sectors employ. It's highly likely that moving large amount of manufacturing jobs to the U.S via protectionist policies will only increase illegal immigration.
 
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Even if manufacturing jobs goes back to the U.S they'll not necessarily goes to Americans. U.S has subsidies and other protectionist policy on agriculture sectors, look at how many illegal immigrants those sectors employ. It's highly likely that moving large amount of manufacturing jobs to the U.S via protectionist policies will only increase illegal immigration.

To be brutally honest, the only people willing to do that kind of back-breaking work in the US are now the Mexicans. Whites and even blacks whatever their social-economic status think it beneath them to do things like seasonal farm labour. They can much more easily go on disability or unemployment insurance (both has been rising like mad after the 2008 crisis and are still rising)
 
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George Smitherman, mayoral candidate went to China before the elections...Do not know why!
:)

^^On a lighter note, he is a Jewish gay...
 
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There is massive job loss and recession no doubt. Corporations have outsourced jobs in order to boost profits, but they failed to pass on the full benefits to the public. Goods are overpriced and only the profit margins have grown. To see it properly, consider the fact that the cost per unit of an Iphone is $200 (this includes manufacturing, R&D, retail and marketing costs). The price is then jacked to $500 per unit. Refer to Cost of Iphone 4. This profit margin is ludicrous. Other Apple products also carry fat margins. Similarly, mainstream and high end Intel processors are way overpriced above their actual costs. Now these Americans buy into marketing hype and keep on purchasing expensive products when they should instead be demanding lower prices, since the costs are effectively lowered once manufacturing is outsourced. These greedy corporations need to be forced to share increased profits which were only possible by outsourcing, by reducing product rices. For this to happen the American consumer needs to become smarter and stop buying into hype. Start looking at competitors who are offering products for lower prices with same quality. Once stuff becomes priced more rationally, it will be possible for businesses to give out lesser compensation to their employees while maintaining the same lifestyle. The saved money can be used to create more jobs at home and also bring back some jobs from overseas.

The above option is a deflationary route. This one will be difficult to sell to the public because it will result in reduced wages. Although I argue it won't change the lifestyle much as prices are also reduced, the truth is "Average Joe" won't understand this complexity. Afterall who would accept a pay cut willingly when everyone expects wages to rise. In reality, rise in wage is offset by inflation, but "Average Joe" doesn't get this. He is happy as long as the absolute numbers rise and atleast do not fall. In this scenario, the other option for America is to inflate the currency. This will effectively reduce the real income while giving a false impression of rising wage. Stuff will cost more as well. But jobs will be brought back as the currency will then be cheaper against others.

Globalization is irreversible. No country in the world can stop it now unless some great cataclysm happens such as an asteroid strike or severe deficiency of energy resources. The solution to it isn't in putting up trade barriers. At this moment, Americans should realize their consumption is way over the world average. This process is unsustainable in the long run. The partying by baby boomers is now over as they spent away the future generations wealth by acquiring more debt in order to spend and party. The new generation needs to break of this habit and work hard for their future.
 
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^^^^" inflate the currency."

You got my point!!!!!!


"The new generation needs to break of this habit and work hard for their future."

That is soo true!!!

Rule of thumb:

Increase the profit margin by 100 percent. All corporations do that!!!
 
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Pakistan get a better leadership--economic reforms etc--We start to import goods from China like the U.S. but in low numbers--What about the local manufacturing capabilities and jobs associated to it? As many Pakistanis depend on manufacturing industry--

How will we cover up the lost jobs?

This argument is bad. Pakistan has the potential to produce goods at much lower prices than the Chinese. 1 yuan = Pak Rs 12. This advantage is significant. The reason why our industries are not performing well is because of internal inefficiencies. We need to improve and streamline businesses and chop off fat. Lazy and carefree attitude will no longer do. A detailed study needs to be conducted where these problems are occuring. Part of it is security problem, part is corruption and poor governance and part is lax attitude of businessmen who feel entitled to protections.

By blocking off trade, these inefficiencies will continue to grow and it will be difficult for us to compete in the global market later. This is not to say that there should be no protection at all because if a local industry does not exist at all then it may be difficult for someone to start a business in this area when foreign goods have already flooded the market. There should be a good balance incentives that allows local businesses to start while at the same time encouraging them to compete globally by exposing them to healthy competition.
 
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This argument is bad. Pakistan has the potential to produce goods at much lower prices than the Chinese. 1 yuan = Pak Rs 12. This advantage is significant. The reason why our industries are not performing well is because of internal inefficiencies. We need to improve and streamline businesses and chop off fat. Lazy and carefree attitude will no longer do. A detailed study needs to be conducted where these problems are occuring. Part of it is security problem, part is corruption and poor governance and part is lax attitude of businessmen who feel entitled to protections.

By blocking off trade, these inefficiencies will continue to grow and it will be difficult for us to compete in the global market later. This is not to say that there should be no protection at all because if a local industry does not exist at all then it may be difficult for someone to start a business in this area when foreign goods have already flooded the market. There should be a good balance incentives that allows local businesses to start while at the same time encouraging them to compete globally by exposing them to healthy competition.

That is why I mentioned economic reforms i.e. currency manipulation---Scenario, quite possible--

12 yuans--1 Pakistani ruppee

Take current situation into account. What would have happened to our labour if the jobs were shifted?
Go back to the ground zero---
 
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In fact, many learned scholars in US already know that sanction would solve US deficit problem as other countries may quickly fill the vacuum that China left.

In addition, US companies in China are also among the biggest losers, as they can't use China's cheap but well educated labors.

Looks like the sanction is to harm others without benefiting oneself. :woot:

That is a misconception. Anyone with first hand knowledge of manufacturing knows how high tech it is. My cousin has worked in an assembly line manufacturing cell phones. (mechanical engineering degree with concentration in HVAC from a top university too, so I also disagree with those who say a bachelors means anything)

There is no such thing as purely manual manufacturing anymore except in final assembly. Everything is, to a degree, automated. Otherwise it's not possible to compete. Even most assembly line tasks are automated, in that the raw materials are input automatically, the line moves automatically, and the final products are automatically packaged. No one sits around, makes a box, and puts iphones into it. It's automatic; only small, extremely precise steps such as actually assembling the parts for an iphone which robots do too expensively or are not even capable of doing, are given to humans.

Let's take making a toy as an example. How do you make a toy? modern toys are solid plastic. No one carves plastic. Instead, liquid polymer is extruded into a mold, controlled by a computer, and carefully shaped. Prerequisite technology? Chemical knowledge of polymer reactions, maintaining polymers in liquid/solution form, design of extrusion mechanism, design of computer software to control the extrusion mechanism.

Evidence: Africans make 1/10th of what Chinese make. Why is Africa not a manufacturing center? Indians make 1/3rd of what Chinese make, why is India not a manufacturing center? There's lots of countries that have lower GDP/capita than China, why are they not all manufacturing centers if manufacturing is so low tech and anyone can do it?

Conclusion: no one else can substitute China's unique combination of competitive wages, high tech manufacturing, and the infrastructure to transport goods to market on time. For your manufacturing needs, please contact a qualified Chinese contractor.

Also, a misconception is that foreign companies actually OWN the factories that produce goods. They do not. It is far cheaper to contract manufacturing out to Chinese companies that specialize in manufacturing (who may manufacture simultaneously for many different, often competing companies). The goods are designed in the US, but the process design is in China. The goods (sometimes identical) would then be labeled with the Western logo, and then shipped out. It is far more expensive to lease the land and open a factory, which may lead to overproduction. Contract manufacturing moves the risk of manufacturing to another company while keeping the profits for yourself.

This reduces profits for Chinese companies but importantly, does not leave them at the mercy of Westerners, which could otherwise close factories at will.

Go to anywhere around Shenzhen, you'll see lots of these no name companies that actually manufacture everything.
 
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Evidence: Africans make 1/10th of what Chinese make. Why is Africa not a manufacturing center? Indians make 1/3rd of what Chinese make, why is India not a manufacturing center? There's lots of countries that have lower GDP/capita than China, why are they not all manufacturing centers if manufacturing is so low tech and anyone can do it?

Conclusion: no one else can substitute China's unique combination of competitive wages, high tech manufacturing, and the infrastructure to transport goods to market on time. For your manufacturing needs, please contact a qualified Chinese contractor.

Good point. :cheers:

China has invested heavily in its manufacturing capabilities, which is why Chinese production is more efficient.

After the Credit Crunch, many Western countries have been dreaming of "rebuilding" their manufacturing capabilities, in order to reduce their massive trade deficits, and to pay off their debts.

But I think it will be impossible for them to get back to a point where Western manufacturing can be more cost-efficient than Chinese industry.
 
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Evidence: Africans make 1/10th of what Chinese make. Why is Africa not a manufacturing center? Indians make 1/3rd of what Chinese make, why is India not a manufacturing center? There's lots of countries that have lower GDP/capita than China, why are they not all manufacturing centers if manufacturing is so low tech and anyone can do it?

There is a certain cost threshold required to be crossed before businesses would consider shifting. Also, government policies on the ground affect how friendly it is to new businesses. All these factors contribute to momentum which means businesses won't shift at the drop of a hat but after they can be assured that significant gains are to be made by shifting. Right now Chinese wages are not evenly distributed even throughout China. Jobs are therefore shifting to other parts where stuff is cheaper to produce.

China's Shifting Jobs Keep Migrants Closer to Home

How Rising Wages Are Changing The Game In China

Conclusion: no one else can substitute China's unique combination of competitive wages, high tech manufacturing, and the infrastructure to transport goods to market on time. For your manufacturing needs, please contact a qualified Chinese contractor.

In a truly globalized world, this would not matter. Technology can always be transferred. A Chinese businessman one day figure he isn't making sufficient money from a plant in China. He may decide to open one in Vietnam instead where costs are lower. Expertise can also be found from the local population. If not it can be brought in from outside. Rest depends on how much incentives the receiving country gives to support these entrepreneurs. Ultimately China's wage increase will move its economy from manufacturing dominant to more service based economy.

This stuff is already happening. Vietnam Tycoon Lures China Companies With Cheap Labor

Vietnam’s textile industry: opportunities and challenges


Also, do not underestimate American, Russian, German or Japanese manufacturing tech. Most of the manufacturing base that these countries have been able to retain is because of rapid modernization and automation, which would otherwise have been shifted to China or otherwise be forced to shutdown. High tech products such as aircraft, satellites and communications, cars, defense items etc, are still majorly produced by these nations (partly because of TOT restrictions).
 
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