Country Analysis --China

Only available on StudyMode
  • Download(s) : 130
  • Published : September 28, 2008
Open Document
Text Preview
Term Project:
Country Profiles –China
&
Analysis the entry of Manufacturer Industry

MBA 780 W1 2008 Spring
Instructor: Professor Christian J. Delaunay, Ph.D.
Student: Hsiao-Shan Lin
ID: 09784

Table of contents
Sections:
1.Executive Summary……………………………………………………..p.2 2.Country profiles
A, Geopolitical environment…………………………………………….p.2-3 B, Economy………………………………………………………………p.3-5 C. Financial System……………………………………………………..p.5-6 D. Culture…………………………………………………………………p.6 3. Entry of manufacturing Industry…………………………………………p.7-8 A. Labor……………………………………………………………………p.8 B. Counterfeit & Piracy……………………………………………………p.9 C. Quality Control………………………………………………………….p.9 D, Public health & Security………………………………………………..p.9-10 F. Regulatory environment…………………………………………………p.10 4. Nike Inc., In or out of China ? …………………………….....................p.10 5. Conclusion…………………………………………………………………p.11 Endnotes …………………………………………………………………p.12-13

Executive Summary:
The project discusses China’s geopolitical, economic, cultural environment and financial system. Chinese communist party owned the power monopoly since 1949 and controlled centrally not only in politics, but also in finance, media and economy. In late 1970s, China shifted from a command economy to a more market-oriented economy and then enjoyed accelerating economic growth. China attracted huge foreign investment and many MNCs outsourced China for cheaper costs for the last two decades. But the poor quality control and rising labor wage causes the manufacturers raise concerns over entering, staying, or leaving the country. The paper will analyze the various concerns for the entry of manufacturers in China and whether Nike Inc. should stay or leave China for its footwear manufacturing outsourcing. . A.Geopolitical environment

China is the most populous country in the world with 1.33 billion people. Since 1949, the communist party won the control of the country and had ruled the country under rigid authoritarianism until now. The power is controlled by the nine members of the Standing Committee which are chosen through behind-the-scene rather than explicit election. The Congress is controlled by the party as well and meets annually to rubber stamp government proposals. China’s economic growth is at accelerating rate since 1980s; however, its political reform does not match the speed with economy growth. Outspoken dissidents will be jailed and the internet is censored. China is notorious for its neglect of human rights, including Falun Gong persecution, violent repression in Tibet and imprisonment of many dissidents. The media is tightly controlled by the government that any criticism of the Communist party is forbidden. Its Press Freedom Index ranked 163 among 168 countries in 2006 according to Reporters Without Borders. Without scrutiny by press and centralization of the power, corruption is inevitable. Corruption in China is estimated to cost $ 86 billion per year, about 10% of government spending. Political corruption will then cause poor products quality control and rampant piracy because of ineffective law enforcement through bribery. B. Economy

In the late 1970s, China began the economic reforms that it shifted from the central planning command economy to a more market-oriented economy. It then allowed more private enterprises and now only one third of businesses are state run. After its economic reforms, China has become the fastest growing economy in the world with average growth rate of 10 % and has attracted a lot of foreign direct investment. The economy of China is the second largest in the world after US with a GDP of $10.21 trillion in 2006 when measured on a purchasing power parity (ppp) basis. It is the fourth largest in the world after US, Japan, and Germany, with a nominal GDP of US$3.42 trillion in 2007. Despite its fast growing economy,...
tracking img