These make China’s export cheaper, and thus more attractive. China believes fixed exchange rate policy can achieve to sustain a high growth rate. The exchange of yuan manage in low, the China has a large degree on export. Fixed change rate eliminates part of the exchange rate uncertainty for Chinese exporters and importers and their trading partners. The fixed change rate creates
That is, China has to face the transitional risks. Since the market of China is opened to the world as RMB internalization, the economy of China is highly correlated to the economy of the world. Thus, anything happened in the global financial market will have influence on the economy of China, especially the exchange rate market. If there is a difference between the nominal exchange rate and the real exchange rate, then there will be an arbitrage opportunity. This will stimulate the short-term speculative capital from the global investors to the exchange rate market and therefore have an adverse effect to the stability of Chinese economy.
Chinese are known for their low cost advantage throughout the world and is acting as a disruptor for other firms as they have changed the whole landscape of BOP market by their offerings. Earlier differentiation and focus strategies were used by the players to offer products for specialized high end segments but now even with these policies they cannot fight against cost leadership strategies of Chinese
This can be attributed to the fact that the overseas Chinese have medium to small-sized firms. The other reason for this is the high transaction cost which is precipitated by the imperfect legal protection and vague operating rules and ill-defined customs are very costly in the long run. This can pose a high transaction cost for the non-Chinese investors. Therefore, a problem which can be easily be circumvented by the overseas Chinese who can take advantage of their cultural and linguistic advantage. 4.2.2 Sector distribution of FDI in China There are a lot detailed sectors distribution of FDI in China.
2.4 Exsisting findings and debates An increasing number of premium luxury brands developed accessible sub-brands (The Affordable Luxury Opportunity in China, 2013). Brand extension strategies may influence the brand image after the extension and that variables such as the brand image prior to the extension, the perceived quality of the extension and the fit between the parent brand and the new product also affect the image. The reason why this strategy has been popular is the fact that it decreases the risk of failure of new products (Martínez & Pina 2003). F. Müge Arslan illustrates that brand extensions affect the product brand image negatively, whereas the fit between the parent and extension brands decreases the negative effect (Arslan & Altuna 2010). Thus, based on the theory of customer-based brand equity (Aaker 2009), the research will study the impact of brand extension strategies on brand equity so that to get theoretical support to create and maintain brand image.
The reality that their firm's approach to hiring is slower than the growth rate in China. (Expand points) Very often they put a global freeze on headcount budget if there is an economic slowdown in the headquarters, but in most cases, the china market is still flourishing and so, they have to understand and needs and demands and growth rate in china. One significant point to note is that all the rules foreign companies have in their headquarters, does not work in China. There is a huge, fast growing, expanding market in china and failure to adopt will reflect badly on its image and success rate. The headcount budget that a company does not want people in china to adopt happens to be the one working well here.
2.2. Chinese Theories Compared to Western theories, Chinese theories are not so complete but they are more suitable for Chinese companies’ condition. In China, from the early nineties of last century, some Chinese economists began to study on the global enterprises management theories and application. For example: National Borderless Business Concept (Qiuzhi XUE, 1997); State-owned Multinational Enterprises Structure (Junjiang LI, 2001); Knowledge Flow Framework (Guoliang XUAN, 2003)... Due to the late start and a complex macroeconomic environment in China, international corporations face huge difficulties and challenges. Both the internationalization theories and applications remain to be improved.
The main thing of them is the low level of the efficiency of technological conversion. In the international competition, the capacities of technological innovation of China were always in unfavourable and marginal position. This situation has already influenced the economic development and the advance of the reforms of the country. Contrary to the innovations, China is a technological empire, which imposes its standards with more than 46 Billion euros possessed by 3 Chinese builders ZTE (Zhongxing Telecom), Lenovo and Huawei Technologies. Levels of activity to set seriously.
Rather than reducing social and economic inequality, China’s rapid economic growth magnifies the gap of benefits received by people in different socio-economic groups. As we will see, social and economic inequality are two sides of the same coin and is not solely the product of economic development. In addition to pure market forces, state policies play a significant role in contributing to the high levels of inequality China experiences nowadays. Despite the government’s concern towards inequality, recent interventions are not sufficiently targeted at the main causes of this issue which result in the continuing climb of China’s inequality figure. Nevertheless, contrary to conventional wisdom, the threat of inequality to China’s social and
China’s competitiveness shows how the supply of cheap and standardized goods can win markets helped by low assets but intense knowledge. It shows the intense, tremendous and autonomous role which trade unions can play in the industrialization of the country. It shows how decentralization and local autonomy can invoke both corruption and boost productivity with equal probability. The story of China shows, like Michael Porter’s all other examples how adversity for a community in a country can work wonders for its