(Koves and Marer, 1991). The introduction of incentives for exports brought China a step closer to trade liberalization as they reduced the biasness for exports. Chinese government effectively managed trade liberalization using 3 mechanisms in order to improve economic performances. Firstly shock effect; pushes most domestic firms to produce at highest potential efficiency under high competitive market. The increasing number of foreign investors in China will have negative impact on the economy without government’s intervention.
Over the last three decades, China has experienced extraordinary economic growth and development and has been successfully integrated into the global economy. Now ranking as the second largest economy in the world, China’s success has been greatly attributed to the gradual shift towards market systems. Though the overall economic system of China has been significantly revolutionized, the political regime has remained inherently authoritarian and the government essentially monitors the capitalistic practices that occur in many sectors within the country. Nevertheless, this powerful augmentation of the Chinese economic system and the fervent expansion of China’s role in the global economy and political stage has presented the United States with
China is a top priority for multinationals in recent years. MNCs consider it as "a place to source product or build retail stores" (Mehra 2012). In recent times China's economy has developed substantially, the domestic consumption market scale is experiencing consistent growth and legal and environmental policies are being improved to facilitate the long-term advantages of FDIs. China has taken the initiative to guide the FDIs into the "high-end manufacturing industry, high-tech industries, modern service, new energy, and energy saving and environmental protection industry" (Yuyang
Globalization can be defined as the process by which countries and people around the world are becoming more and more connected. This exchange of information and cultures occurs mainly due to the increasing trade around the world. Hence, it can be said that globalization is closely linked with the economy. China’s economic reforms started in 1979 mainly as a response to globalization. As a result of globalization and China’s comparative advantage in inexpensive manual labor, China now enjoys an export-propelled high GDP.
Chinese production of oil is among the highest in the world after Saudi Arabi (Zhao, 2013).This is beneficial to Caterpillar as it will provide the necessary equipment to extract the oil since there is high demand in China. Furthermore size and growth of the Chinese economy has also encouraged increase in foreign direct investment in China ( Dees, 1998 ) .China has a population of 1.2 billion, Over the past years China's economic reform has been rapidly increasing, with purchasing power of the people strengthening and
In addition to easing the policy of birth control and raising the retirement age, the most important approach is to further develop the economy in China. Serving as the material basis of national strength, the prosperous economy can effectively reduce the pressure caused by the aging problem in the
Vietnam's exports different aligned with the world trade, and the world trade growth is proved to be vitally encourage the expansion of exports. The export products of Vietnam penetrate better in the high-income markets such as Japan, the USA and Korea. This is because of the better competitiveness and higher harmonization of those products to the import demand of its trading partners other than the better market access. The dynamic comparative advantage became increasingly evident no matter in some of the
Development of large quantity of electronics, computers, and advanced communications technologies indicate the transformation and modernization process of the Chinese economy. Chinese economy is becoming more effective in the global economy. U.S. administration threatened China to suspend normal tariff treatment because of human rights issues, but had to make a U-turn as the ultimatum was to expire due to China’s increasing influence in the world economy. China’s economic development goes hand in hand with scientific and technological
However, when Chinese government decide to open their market up to the rest of the world, China has become more powerful and richer country than 19th century’s China. Chinese people also get more richer than before. Therefore, economic globalization promote the improvement of the economic benefit, and it could help both developed country and developing
Thus, strategic-asset seeking OFDI enable companies to increase their ownership-specific advantages or decline other companies’ competitiveness. The European manufacturing industry with its modernized technology has prompted Chinese investment during the recent economic crisis in Europe. The investment allows Chinese manufacturing industry to move up its’ value chain and advance their position in the domestic market. Chinese has displayed specific interest in industrial machinery and automotive industries. Companies such as Volvo, Putzmeiser and Ferretti have attracted Chinese