China Has Always Been the Lead In Manufacturing , but What Is It That Makes China "top Dog"?

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UNIVERSITY OF HUDDERSFIELD[pic 2]

School of Art, Design and Architecture Department of Textile

TD 1055

China has always been the lead for mass production, but times are changing, what is it that makes China “Top dog”?

A Dissertation submitted in partial fulfillment of the requirements for

BA (Hons) Textile design for Fashion and interiors

 Rachel Ann Addy

The candidate confirms that the work submitted is his or her own and that appropriate credit has been given where reference has been made to the work of others.

16th December 2011

Ch1 Introduction

Throughout this dissertation the author will look into the arguments for and against China as lead mass producer and economic power, combined with its development strategies over the years and how it will improve and grow in future. China has changed dramatically since its industrial revolution in 1966, showing many signs that its improvement process and growth has not ended. The sheer size and capacity of the country gives China an advantage over many competing traders such as Turkey and Cambodia. This study of China’s evolution will allow us to see if there are any patterns in the growth over time and what it is that has given China the strength to now become one of the world’s leading superpowers.

It seems that China has developed rapidly in a short period of time, described solely as a manufacturing boom. China has enjoyed growing foreign investment and receiving business from failing competitors. The growth of China is leading many people to question when it will end; will China one day be able to lead the world in this economic climate or will history repeat itself and yield under its fast developing new economy?

There are many arguments for and against China’s recent changes and developments leading to its position in today’s markets. Looking at people’s opinions on why businesses have moved to China, and what attracted them from abroad and how this decision has affected their trade will help to understand the evolving position of China in the world.

There are many questions about what will happen to China’s development in the future, difficulties such as; rising labour costs, inflation and cost of raw materials, have all led to manufactures looking for a new location for their mass production. China is classed as Britain’s most reliable mass producer, and with the current economic down turn it is difficult to see how China will be able to remain this position.

China’s government has had a large impact on how the country has grown and developed. Having a large investment in the country’s leading organisation means that they are able to keep close control of what is happening in the primary markets. China’s government force local producers into foreign trade unnecessarily. China could afford to trade solely within its own frontiers, however the government relies on its foreign trade to keep their position as a world power. The world now needs to produce its good in China, and this need is allowing China to keep the upper hand.

1.1 Aims and objectives:

• To develop an understanding of industrial development, and what attracts overseas markets to China.
• To find out how quickly the production markets stability can change, and understand what influences the increase and decrease on such a rapid scale.
• To understand what attracts businessmen to begin their business developments in China.

1.2 Chinese history, disciplines and attitudes

China has had a dramatic timeline of events that have helped them to develop as one of the world’s leading mass producers. A cultural revolution in 1966-78 opened the gateway to China’s foreign investment in December 22, 1978, the party leaders decided to undertake a program of gradual but fundamental reform of the economic system. Politically China became a strong nation, controlled largely by their government and its beliefs, the people of China followed the direction in which they were lead. The government had a strict control over elements such as foreign trade, publicly exploiting, and freedom of speech. China’s government realised that in order to improve their country’s infrastructure they would need to invest time and money in educating their people and managing their assets. As a result China pursued an educational strategy designed to ensure it could offer a technically skilled work force.

China’s ability to pour money into education and infrastructure has shocked others with its growth and development. However as New York Times columnist Thomas Friedman say,

“Remember what Grandma used to say; never cede a century to use a country that censors Google”(1)

It is often remarked that the Chinese government is preventing its people from seeing too much. Having once banned Google, and now banning Facebook is causing the Chinese communities challenge this. During a visit to China it is easy to see how they find a way around all situations. However is the censoring going to with stand with the new generation? With the Chinese youth being more outspoken and adventurous, just how long can the government keep such a control over its people? There are many fears as to what will happen to the stability of China once the new generation takes over, and the old traditions are laid aside.

Chinese culture gave the government a strong advantage; their passion and drive meant that they wanted to be educated in order to become successful. The sheer size of China gave it an advantage; with a population of 975.23 million the government has something to offer to its foreign markets; a fully educated and enthusiastic workforce.    

1.3 Labor costs

One of the main impediments China has come across recently is raising labor costs. The Chinese people are now becoming very aware that the employers need them. Most Chinese workers are migrants, coming from the countryside and small towns to work in the big industrial cities. During Chinese New Year the migrants are able to return home for approximately 3 weeks, during this time factories are constantly worried if they will return. It is known that China’s cheap labor built its economic miracle. However, with its struggle to keep the work force, China may fail to maintain its title of cheap producer.