An article published recently in New York Times by Steven Rattner (2018) on whether China’s version of capitalism is winning is particularly relevant to the week’s readings. In the article, Rattner claims that the move by President Donald Trump to refuse to cooperate with China is uncalculated. It ought to be considered that China is densely populated, and the more the number of people, the bigger the market. US investors could potentially lose the Chinese market.
In the week’s readings, any country that seeks to do business and gain a significant portion of revenue ought to address three critical issues; what to produce, how to produce and whom to produce for (McEachern, 2016). Rattner argues that while the US continuously works towards frustrating the efforts of China, the Chinese government has structure in place to gain a favorable global market share. For instance, China has embarked on upgrading its infrastructure. The country is building competitive subway systems, airports, as well as, renewable energy facilities. That means that the country will have a competitive transport system, which will help in exporting its products.
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China is not only improving its infrastructure but also competing with the US in the field of technology. Although the US is regarded as the leader in Artificial Intelligence, China has also immersed itself in the field and is expected to offer the US stiff competition in the future (Rattner, 2016). As much as China is producing goods and improving on its mode of delivery, it is also acquiring a sizable global market, particularly in Africa. Additionally, China remains relatively neutral on various world matters; the country’s concern is to do business.
Conclusively, Rattner notes that China has a mixed market economy which plays to its advantage. Such a type of economy makes it even more challenging for the US to estimate the potential of the Chinese economy. The Chinese government controls some of the country’s business while it leaves some unregulated. Additionally, China seems to have tough regulations on foreign investors but allows its citizens to thrive. Rattner cautions that although China imposes tough regulations on foreign investors, the US should be cautious when dealing with the matter.
References
McEachern, W. A. (2016). Economics: A contemporary introduction . Cengage Learning.
Rattner, S. (2018). Opinion | Is China’s Version of Capitalism Winning? Nytimes.com . Retrieved 31 March 2018, from https://www.nytimes.com/2018/03/27/opinion/china-economy-state-capitalism-winning.html?rref=collection%2Ftimestopic%2FEconomic%20Conditions%20and%20Trends
