Final research paper
JiaBiao Zhang
MBA 551
Dr.Jordan
December 11, 2011

Final research paper
Introduction
China has become one of world's most promising economic power. Since 1979 Chinese market has a great and quickly growth. Enter the twenty-first century, the Chinese economy has maintained steady growth. Although less than expected, but China's GDP growth still reached 9.1% in Q3 2011. "China's gross domestic product expanded at the slowest pace in nearly two years in the third quarter. GDP growth moderated to 9.1 percent in the third quarter from 9.5 percent in the second quarter. On a seasonally adjusted quarter-on-quarter basis, GDP rose 2.3 percent following a revised 2.4 percent gain the second quarter". (www.TradingEconomics.com) This situation shows China's economic growth is still high. Why China has this success, because China has many advantages. For example, low cost labor and a huge mark.
China's economic advantages China's main advantage is the production capacity and low cost labor. The main reason is China's huge population, and the rich natural resources. Today China has become the famous factory of the world. China's cheap labor and huge market has attracted a lot of foreign investment. These investments have brought to China a lot of money, but also provides science and technology and management experience. First, Chinese low cost labor. This is China's primary advantages, most Chinese factories are located in the eastern region, mainly due to convenient transportation and a good industrial base. In China, many poor people are come eastern areas looking for opportunities, this has resulted in a lot of labor resources. Because these workers come from poor areas, so they only require very low wages, the wages of the Chinese people are often lower than the United States a quarter or more. "Banister concluded China has about 38 million city manufacturing workers. The 30 million on whom she found data earn an average $1.06 an hour. Another roughly 71 million suburban and rural manufacturing workers earn an average 45 cents an hour, for a blended 64 cents. In the current BLS survey, Mexico's $2.48 hourly compensation is the lowest".( http://www.businessweek.com ) Many foreign companies choose to invest in China because this country is very cheap labor, while China has a huge market. This is another important factor in the success of China. As we all know, China is the world's most populous country. The development of recent decades is also very good, so many Chinese people began to wealthy, some people even very rich. In China, many people purchase standard is expensive goods is good. In addition, a large number of factories make many workers need to purchase goods. A huge market is that many companies like. These investment or consumption will bring to China a lot of taxes and promote consumption. Chinese companies is China's another advantage. Many small companies take a lot of outsourcing, many famous brands choose China's outsourcing services. For example, Adidas, Nike, Apple. This will also increase China's economic strength, but this situation also will make other counties lose jobs. Of course, outsourcing profit is very low. However, a large number of Chinese workers and low cost make this income looks like very huge.
China's other advantages In addition, China also began to enhance the technological advantage. In China, education always is an important topic. Many parents want their children to get a good education, and China needs a lot of technical talent. These investments in education have begun to produce results. In the past, China's lack of sufficient technical and scientific talent, which resulted in advanced industrial investment in China is difficult. For example, in my father's era, he was a worker for a refrigerator company. After the company purchased a foreign production line, the company's managers found almost no one know how to use these devices. Finally, the company had invited many foreign experts to guide, the result is not very satisfactory. The company's products are often have some problems, the main reason is the lack of skilled workers. For these companies, in the past, found a skilled worker is very difficult and with a high wage. But now the situation has improved. "The Chinese government pledged last year, in its 11th five-year plan, to pour 14bn Yuan (£920m) into vocational training between 2006 and 2010, and to skill an extra 36 million workers. It is a U-turn on previous policies, which cut the budget for vocational education. The government anticipates that the number of students in vocational schools will soon be equal to those in the more academic equivalent, senior high schools for 15- to 17-year-olds".( http://www.guardian.co.uk ) advanced workers can even read English. China has also demonstrated technical advantages in some areas, it is conceivable cheap workers and leading products, how much will have a huge advantage. Of course, this advantage is not obvious, China still needs some time to improve this advantage. About China's political problem, this is indeed a sensitive issue. China has an authoritarian government, which cannot be denied. However, such a government will have some advantages. Typically, the Chinese government can focus on the completion of some projects. Many important decisions are very fast, also has sufficient funds. In fact, if Chinese government wants to do something, then no one in China can stop it. The Government can quickly adjust their policies, and focus on enhancing economic strength. About Chinese culture, this is interesting problem. China has a long history and culture. This will cause a lot of advantages. First, tourism an important industry in China, the Imperial Palace is a famous tourist destination, China also has many other historical or natural tourist destination. The trend of globalization, many foreign tourists want to travel to China, which is Chinese an important income, and even many region the most important income. Chinese culture has some very good parts, for example, patience, hard work and savings. These are very important factors. If a country's people with these characteristics, then for a country's development is certainly a great help. In many times, employees will choose to Chinese to complete its work unpaid overtime, and the difference from American workers, even during the holidays many Chinese people continue to work, of course, there are many purposes, such as money, promotion and hobbies. Chinese employees are able to withstand harsh working conditions and heavy work, these features are valuable. I was worked for a TCM company, this company needs some staff to process raw materials. This process is frightening, it will produce large amounts of dust and odor. These workers describe themselves as Terracotta Warriors, because when they complete this process, others almost impossible to distinguish their faces. However, these employees still work for this job.
China's dilemma Chinese also has many difficulties. Many regions of the country is still very poor. Many Chinese workers want to increase income. China's economic development also has some big problems. In addition, the natural environment is also a problem cannot be ignored. First problem is poor. Many parts of China are very poor, China's developed areas are concentrated in the east. This makes other areas is difficult to get a good opportunity. These areas people are very poor. In China, anyone can find a lot of poverty alleviation activities, there are many examples. However, poverty cannot solve the problem of poverty can only help the poor to ease the difficulties. The Chinese government also began to develop these areas, the effect is not very satisfactory. Transport and education in these areas are very poor, limiting the development of these areas. This is the Chinese government does not want to see, it also affect China's economic situation. This situation is a financial burden, every year the Chinese government require a lot of funds to help those areas, if those areas are not poor, China will have more money to develop the economy. However, in fact the people in these areas due to lack of education and opportunity, will become poorer. In addition, the Chinese Government to adopt some special means to eradicate poverty, the poverty line in China often is controversial. These false means only the eradication of poverty in the paper, cannot solve any problems. " With at least 8% of the whole population still living well under the international poverty line, China has a long way to go to become a truly well-off society, despite the sharp increase in the number of multi-millionaires, despite the prosperous outlooks in coastal cities, and despite inflating nationalistic pride in the country's growing economic muscle". (http://www.atimes.com) Second problem is low wages. Many Chinese companies only give a very low wage employees. In fact, after these companies can offer higher wages, they can still get a lot of profit. Many Chinese people want to pay rise, and pay rise by more than inflation. This situation is growing, companies and employees the conflict increases. In addition, China's demographic dividend is weakening. These have led China's labor costs began to increase." The wage issue has started to affect how companies operate in China. U.S. corporations and their suppliers are starting to rethink where to locate facilities, whether deeper into the interior (where salaries and land values are smaller), or even farther afield, to lower-cost countries such as Vietnam or Indonesia. Already, higher labor costs are beginning to price some manufacturers out of more developed Chinese cities such as Shanghai and Suzhou. "There is a break point where people will say this is too expensive," says Michael Barbalas, general manager at the Suzhou plant of Andrew Corp. (ANDW ), a Westchester (Ill.) maker of wireless networking gear. At his factory, he says, wages have been rising by 10% annually". (http://www.businessweek.com) Last problems are the environment and unhealthy economic situation. If a country wants to sustainable development, then cannot ignore environmental issues. This problem always affect China, many cities in Chinese, air pollution has reached intolerable levels. For example, in my hometown - Tianjin, only in big windy weather, we can see the blue sky. Other regions also been contaminated drinking water, which is a terrible situation. Although the Chinese government began to address this problem, but they pay more attention to economic issues. China's economy has a serious problem. Excess real estate development. Many Chinese people's life savings can only buy one apartment, and even many decades loans to buy real estate. This creates a problem, these people spending money only to the real estate industry. Now, China's real estate prices are 5 times of 10 years ago or more. This is a very serious problem and crisis.
Summary
In the next few years, China will continue to maintain high-speed development. China will remain a world factory, take a lot of outsourcing work. However, China needs to adjust and improve the living standards of Chinese people and the develop the domestic market. China's low cost labor will decrease, will face some financial problems. Chinese government to solve these solving abilities and methods, will decide the future of China.

Reference http://www.tradingeconomics.com/china/gdp-growth http://www.businessweek.com/magazine/content/04_50/b3912051_mz011.htm http://www.guardian.co.uk/education/2007/dec/04/schoolsworldwide.schools http://www.atimes.com/atimes/China_Business/KD09Cb01.html
http://www.businessweek.com/magazine/content/06_13/b3977049.htm