People's Republic of China and Record Growth

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1. Do you think China will continue to achieve record growth? What factors could hurt its prospects? I doubt that China will continue to achieve record growth in their economy in the future. The Chinese workers are beyond aggregated with the policies in the workplace for such a thriving economy. They expect more for their labor from a country who has real GDP growth by 8.7% in 2009 and 11.9 to 10.0 in 2010. Eventually the workers will go on a major strike and this will affect manufactures all over china, unless they improve wages and working condition. China cannot thrive on a cheap labor anymore. One major factor that can hurt China in it prospect is to achieve record growth is the fast that China has not moved fast enough in opening up previously protected sectors and has generally favored Chinese firms for large government tenders such as those issued as part of the government $586 billion stimulus package.

2. Because of an abundance of cheap labor, China has been called “the workshop of the world.” Do you think this will still be the case a decade from now? Why or why not? No, I don’t think this will case decades from now, mainly because, Chinas economy will decline and they will learn the value of treating their workers with the adequate needs necessary.

3. What communication and negotiation approaches are likely to work best when foreign MNCs experience demands from Chinese workers for high wages? An effective communication flow that can be utilize for foreign MNCs who experiencing demands from workers, is downward communication. This type of communication is the transmission of information from managers to subordinates. Negotiation is important to settle an agreement with the Chinese workers who are requesting high wages. Specifically, distributive negotiation is a great cross – cultural managing negotiation technique. Distributive negotiation is barraging that occurs when two parties with opposing goals compete over a set value.
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