Much of the US population is misguided about the progress China has made and what are future prospects in good relations with the industrial counterpart. Shaun Rein, an America economic researcher/expert, has authored a book, The End of Cheap China: Economic and Cultural Trends That Will Disrupt the World that provides a deep insight into Chinese economy and its relationship with the US.
Both China and America make up most of the world’s economy, not only in production but also in consumption. However, the relationship between the two countries, in terms of business, has always been fragile and has been aggravated to certain lengths of late.
According to Rein, the American public has been misguided on Chinese virtues, business culture and ideology of competition. Most of the experts based in the US are of a vague opinion that the main reason for Chinese domination in production of
world’s most commodities, from electronics to heavy-duty machinery, is due to cheap currency and likewise labour rates.
Rein breaks down the basic structure of both Chinese and American economy in his book. He provides insight into to the trends that have changed in China over the years, especially after the industrial revolution.
According to him, China is not an inexpensive country anymore. The ‘cheap currency’ has appreciated 8 percent since last year. 21 out of 31 provinces in China have increased their labour wage rate to 22 percent. Office space in Shanghai is more expensive
than in many of the Western capitals. He further asserts that currency rate is not the only factor that contributes in higher production.
Rein notes that boycotting Chinese products, or as billionaire real estate magnate Donald Trump suggested forcing tariffs on Chinese imports, will not assist in better employment rate in the US. The reason for cheap and large production capacity in
China is the infrastructure that has evolved over the years.
Moreover, he adds in the book that China is one of the biggest consumers of goods in the world. By 2012 it will become largest Intel customer. Apple and Dell products are already trending in the mainland and Hong Kong.
Rein has Master’s degree from Harvard University and specializes in Chinese economy. He has spent majority of last 15 years in China and co-founded
China Market Research Group and currently serves there as the Managing Director.