Chinese Economics Thread

[tphuang]

https://twitter.com/i/web/status/1655197317383766017

BYD bringing ESS cost down for everyone. It's winning most of the bids with the lowest bids. Likely to continue as it scales up production

 

[KYli]

why are people so insistence on putting down India on this forum? Both countries can develop on their own timeline. If we think that China has plenty of room for growth with automation, then we shouldn't care about what western media says about jobs leaving China to go to India and ASEAN.

In my mind, China needs to move a lot of lower end manufacturing job or final assembly jobs to Central Asia, ASEAN, India & Mexico. In some cases it's because China doesn't need to do everything on its own. In other cases, it's because it helps to build relationships with these countries and keep them tied to your supply chain. Finally, it allows these countries to open up their market to you and to use them to get around Western protectionism. At the same time, China can move up supply chain

Why not, anyone who has done business with Indians knew that they are difficult to do business with. It has nothing to do with the fact that India is a major rival with China. It is a fact.

In addition, moving a lot of lower end manufacturing jobs is never a good idea to begin with. Those jobs are still vital for China for the next decade or so as many mainland Chinese in the 40, 50 and 60 still can only work in manufacturing. Beside, robotics might be able to replace some of them and give China a edge to provide more high end manufacturing jobs through automation to retain the supply chain.

It is not to say many manufacturing shouldn't move their plants to developing countries but China shouldn't embrace such moves like the West did that automatically destroyed their supply chain.

As for opening up their market, it is extremely complicated and relying more of such countries' own development and stability in society than other things. Western protectionism could still hit Chinese even if Chinese companies move their plants to other countries such as Solar or if the West targeted material such as Cotton or Brand name companies such Huawei or DJI.

 

[BlackWindMnt]

out of topic, but the arrival of automated manufacturing seem to spell certain uncertainty to the development of India..

Sure automation will spread but it might also mean regions might minimize trade with other regions to protect their development of goods and services.

But then again people have been speaking about automation for decades now and I would have expected a hyper automation transformation to have happen in the last 3 or 4 years. But alas there is still a labor shortage in the west.

 

[luminary]

Not necessarily if you look at GDP alone. India can also automate its manufacturing. Of course, the problem then becomes one of social stability. GDP may go up but if unemployment also goes up, then you have a massive problem on your hand.

China's recent rise in youth unemployment is probably an early sign of this. China's industry is massively increasing automation, which reduces the need for labour. If AI does the same to the service sector in the next 10 years then China has a big problem.

But here a gently declining population might actually become a blessing in disguise. India's much younger population will make it much harder for them to manage such an outcome. So that's why I am not so worried about China's demographics as economic growth is increasingly driven by productivity increases borne out of automation. In such an environment, having China's demographic profile might actually be an asset.

I don't see a problem with China's youth unemployment rate. In fact, it's good. Youth are more flexible in terms of lifestyle and location, can change careers and education, and do not have the burdens of a family or other financial dependents. I would be far far more concerned if we saw unemployment with middle aged workers.

In fact, this is really good. Automation has come at a good time for China. This is a wake up call that the youth cannot stay complacent, that the workplace is changing and they must always be aware of new tech and how to automate their jobs, and also instill the idea that adaptability and innovation is the future fundamental tenet of the economy.

Although this cohort of youth may be smaller in size, I am confident that the difficulties and societal conditions they grow up in will create a bolder and more innovative generation.

 

[luminary]

The above infographic uses data from

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to visualize global gold production by country from 1820 to 2022, showing how gold mining has evolved to become increasingly global over time.

The

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Around 31% of the world’s gold production in 2022 came from three countries—China, Russia, and Australia, with each producing over 300 tonnes of the precious metal.

The Outlook for Global Gold Production​

As of April 25,

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were hovering around the $2,000 per ounce mark and nearing all-time highs. For mining companies, higher gold prices can mean more profits per ounce if costs remain unaffected.

According to the World Gold Council, mined gold production is expected to increase in 2023 and could surpass the record set in 2018 (3,300 tonnes), led by the expansion of existing projects in North America. The chances of record mine output could be higher if gold prices continue to increase.

 

[sunnymaxi]

Why not, anyone who has done business with Indians knew that they are difficult to do business with. It has nothing to do with the fact that India is a major rival with China. It is a fact.

In addition, moving a lot of lower end manufacturing jobs is never a good idea to begin with. Those jobs are still vital for China for the next decade or so as many mainland Chinese in the 40, 50 and 60 still can only work in manufacturing. Beside, robotics might be able to replace some of them and give China a edge to provide more high end manufacturing jobs through automation to retain the supply chain.

It is not to say many manufacturing shouldn't move their plants to developing countries but China shouldn't embrace such moves like the West did that automatically destroyed their supply chain.

As for opening up their market, it is extremely complicated and relying more of such countries' own development and stability in society than other things. Western protectionism could still hit Chinese even if Chinese companies move their plants to other countries such as Solar or if the West targeted material such as Cotton or Brand name companies such Huawei or DJI.

Chinese are very smart.

This is exactly China is doing right now. not giving up even low-end manufacturing like textile industry. the total export value of garment exports in 2021 closed at a whopping $170.3 billion. now what's the funny thing ? China also producing clothing machinery and equipment and localization rate reached at 80 percent in parts/components.

at the same time, they are building the supply chain of semiconductor and civil aviation. upgrading shipbuilding, heavy industries , military industrial complex.

President Xi chaired the 20th Central Financial & Economic Affairs Commission.

some important points

1. Focus on high tech manufacturing.
2. Ensuring supply chain security, through industrial upgrade. Sectors should not be given up simply because it's "low-end manufacturing".
3. Improve the quality of the population and maintain a steady population size

https://twitter.com/i/web/status/1655059877017042945

party has strict orders. we cannot let manufacturing go away from us just like West did. we must hold the real wealth. manufacturing made you a superpower.

 

[HumanHDMI]

I don't even understand the whole hysteria about supposedly high youth unemployment rate in China. Plenty of European countries have higher rates, most have comparable ratios. The US has lower youth unemployment because a lot of people there cannot afford higher education ever and hence enter the labour pool early or they get into college\university but have to work to afford the living costs. That's hardly a good thing, plus there's the whole cultural thing about forcing teenagers to seek jobs to earn pocket money.

Most young people of that age bracket in China are focused on education and would be at best looking for part-time jobs, and many of them are supported by their parents anyway. I bet at the end of that age bracket (23-24) the unemployment rate drops to be more or less in line with the rest of Chinese employment rates. I don't see the issue, seems like another dumbass thing that was nitpicked by the Western white propaganda machine like the "Evergrande China's Lehman moment" pieces they were churning each second but then their own banking system started collapsing.

Its because it hasn't been this bad in a while, no. Chinese youth have higher standards and rightfully so, they shouldn't compromise cause elsewhere is worse. Government should and prob will deliver

 

[tphuang]

Why not, anyone who has done business with Indians knew that they are difficult to do business with. It has nothing to do with the fact that India is a major rival with China. It is a fact.

In addition, moving a lot of lower end manufacturing jobs is never a good idea to begin with. Those jobs are still vital for China for the next decade or so as many mainland Chinese in the 40, 50 and 60 still can only work in manufacturing. Beside, robotics might be able to replace some of them and give China a edge to provide more high end manufacturing jobs through automation to retain the supply chain.

It is not to say many manufacturing shouldn't move their plants to developing countries but China shouldn't embrace such moves like the West did that automatically destroyed their supply chain.

As for opening up their market, it is extremely complicated and relying more of such countries' own development and stability in society than other things. Western protectionism could still hit Chinese even if Chinese companies move their plants to other countries such as Solar or if the West targeted material such as Cotton or Brand name companies such Huawei or DJI.

I don't see why that makes it okay to pick out India? Indians has their own issues to deal with, why always focused on their failures? Maybe you should give Westerners a harder time rather than picking on another member of the global south.

As for your second part, opening up factories in ASEAN countries open up those local markets. You have to invest in countries that you want to do business in. Like BYD right now with factories in Thailand and Vietnam and India, looking to build more factories.

There is a difference between retaining supply chain and keeping your market share in low end manufacturing. I'm completely fine with doing more factories in places like Vietnam and Malaysia for export to Europe & America. While you can pick a couple of examples where America has closed loop holes. The reality is that China has been doing this since the Trump tariffs and this offshoring has allowed China to continue to export its products to America and keep up the dependence.

 

[KYli]

I don't see why that makes it okay to pick out India? Indians has their own issues to deal with, why always focused on their failures? Maybe you should give Westerners a harder time rather than picking on another member of the global south.

If you ever have dealt with Indians, then you probably should know that Indians are the most difficult people to do business with. Just because India is part of global south, it doesn't mean we should give it some slack. Beside, India is a major rival for China which it has aligned its interests with the West to contain China. More importantly, after so many Chinese apps that were shut down by India, so many Chinese companies including State owned ones that never got paid and so many Chinese companies that got fined by India for tax issues such as Xiaomi. I just don't see why China should help India in anyway or form even if we are looking at purely business POV.

As for your second part, opening up factories in ASEAN countries open up those local markets. You have to invest in countries that you want to do business in. Like BYD right now with factories in Thailand and Vietnam and India, looking to build more factories.

I never see it a problem for Chinese companies to open factories in ASEAN as long as there are enough potential to justify such investment. I just disagree that Chinese government should encourage such investments. Retaining the supply chain is still the upmost important especially as there are still millions of Chinese that are looking for good paying manufacturing jobs.

There is a difference between retaining supply chain and keeping your market share in low end manufacturing. I'm completely fine with doing more factories in places like Vietnam and Malaysia for export to Europe & America. While you can pick a couple of examples where America has closed loop holes. The reality is that China has been doing this since the Trump tariffs and this offshoring has allowed China to continue to export its products to America and keep up the dependence.

When Xiaomi moved its factories to India for local business, it didn't just move its own factories but also factories of its supply chain. When Apple forced Chinese devices manufacturing companies to move factories to Vietnam, it also asked the whole Chinese supply chain to move to Vietnam.

Moving factories as purely business decision with good reasons are justified but in no way and form should Chinese government encourage such investment because after your factories moved to other countries then your supply chain would also follow them. Why should China make the same mistake the Western powers make.

 

[tphuang]

If you ever have dealt with Indians, then you probably should know that Indians are the most difficult people to do business with. Just because India is part of global south, it doesn't mean we should give it some slack. Beside, India is a major rival for China which it has aligned its interests with the West to contain China. More importantly, after so many Chinese apps that were shut down by India, so many Chinese companies including State owned ones that never got paid and so many Chinese companies that got fined by India for tax issues such as Xiaomi. I just don't see why China should help India in anyway or form even if we are looking at purely business POV.

I have dealt with many Indians and I have not found that to be the case at all. It seems that you have personal grievances with Indians.

Nobody is asking China to help India in anyway. I spend my time on this forum to build China up and not to tear other global south nations down. I don't need to put down India to build up China.

I never see it a problem for Chinese companies to open factories in ASEAN as long as there are enough potential to justify such investment. I just disagree that Chinese government should encourage such investments. Retaining the supply chain is still the upmost important especially as there are still millions of Chinese that are looking for good paying manufacturing jobs.

When Xiaomi moved its factories to India for local business, it didn't just move its own factories but also factories of its supply chain. When Apple forced Chinese devices manufacturing companies to move factories to Vietnam, it also asked the whole Chinese supply chain to move to Vietnam.

that supply chain is just for xiaomi phones sold in India and Apple phones in general. There is still plenty of supply chain left in China for Chinese phone companies.

The reality is if you want to gain market share in any country with ambitions to industrialize, you need to build factories there. Again, that's why BYD is going to build factories in Thailand, Vietnam and Indonesia. If you want to dominate sales of these large industries with national importance, then you have to be prepared to employ locals.

Moving factories as purely business decision with good reasons are justified but in no way and form should Chinese government encourage such investment because after your factories moved to other countries then your supply chain would also follow them. Why should China make the same mistake the Western powers make.

I think you should just relax. Chinese companies are pretty good with maintain supply chain needed for China's own needs. But at some point, you cannot continue to run these astronomical trade surplus against every other nation or they won't want to trade with you anymore