Thursday, January 11, 2007

Most things in the West might seem to be made in China, but North America remains the true workshop of the world. Whilst many companies use China as a manufacturing base, chaging fortunes in the the country are forcing delegation. Manufacture of shoes is labour intensive with each shoe passing through up to 200 pairs of hands on a production line. When it comes to calculating costs, risks, customers and logistics an increasing number of firms are now coming to the conclusion that China is not necessarily the best place to make things. In Indonesia, the Chinese company Yue Yuen , makes casual footwear for brands like Nike and Adidas and is considered the world's largest contract shoe manufacturer. The company produces more than 180 million pairs of shoes a year from factories in China, Vietnam and Indonesia, most of them bound for America and Europe. So when the European Union imposed anti-dumping duties in October 2006 on leather shoes imported from China and Vietnam, the firm was quick to raise its production in Indonesia. China's share of the world's exported goods tripled to 7.3% between 1993 and 2005 and by comparison, with the exception of Russia, every other nation represented at the G8 Conference saw its share fall. It is a similar story with manufacturing output. Whereas China doubled its share of global production to almost 7% in the decade to 2003, most of the G8 saw their shares fall. Interestingly, only the United States and Canada saw their shares rise—with just over a quarter between them. China is the emerging giant, but as costs rise in the industrial sectors of China, (eastern coastal regions around Shanghai and the Pearl River Delta), more investments that are being diverted away from the Mainland China to the rest of Asia. Attempts to develop the west of China (traditionaly rural) have met with resistance. Official figures record 87,000 incidences of rioting and social disturbance in 2005, much of it following the forced appropriation of farmers' land.

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