In 2008, according to the World Bank, China had a GDP of approximately 4.326 Trillion. Given that China projected growth of 8% in 2009, that puts them at about 4.672 Trillion for 2009. Continuing this trend, as China is projecting similar growth for 2010, that puts them at a GDP of about 5.046 Trillion this year. Meanwhile, Japan, which clocked in at 4.909 Trillion in 2008, just downgraded its projected growth to 1.3% for 2009, putting it at 4.973 Trillion for the year. As its economic outlook is not looking up, holding steady, this puts Japan at an estimated GDP of 5.023 Trillion for 2010. What does this mean? This will likely be the year that the Tiger ROARS and China becomes the 2nd largest producer of GDP in the world.
So what should you do besides learn Mandarin, if you haven’t already? (You can even start for free at sites like Chinese-Tools.com.) Good Question! While I still adamantly believe that you should not be importing goods from China that you can produce closer to home — as there’s nothing lean about an 8,000 mile supply chain — that doesn’t mean that you shouldn’t be producing in China for the Chinese market. Or that you shouldn’t be tapping the collective knowledge of the almost two million geniuses that live in the country.
But where do you start with the world’s fastest-growing economy? I’m not sure, but a recent article from Knowledge@Wharton on The Road to China that interviewed Harbir Singh, Saikat Chaudhuri, and Lawton Burns on their recent trips to China provided some fresh insights that are worth a second thought.
The economy is barreling ahead in high gear in major cities like Shanghai and Beijing which have literally transformed over the last decade. They have a strong infrastructure, a very strong manufacturing-based economy (as they are the manufacturing hub of the world), and are investing a lot of money to set up firms and an ecosystem to foster innovation. They’re trying very hard to move up the global value chain very fast. Plus, a lot of overseas Chinese are now returning to China — junior people as well as senior people.
However, they’re still a big country with a huge population which collectively has many different types of people with varied interests. As a result, where China is concerned, it’s still about managing diversity. It’s about meeting the aspirations of those people and managing the differences, as much as its promoting some uniformity in a standard of living.
In other words, you probably have to start by diving in head first because there’s so much happening, so fast, that it’s hard to really wrap your head around it all unless you’re immersed in it. But check out the article. Although it’s five pages, it is quite interesting.