China has started to take up his works and factories and again to reciprocate the work but their hurl back will not be the twin.
Regardless of, China was the world’s beloved economy for the past 40 years, the stability of economic strength has begun to move in direction of someplace that we somehow can’t anticipate. In reality, we began to observe the indication of more nations growing up in a way to obtain little of china’s manufacturing Heroism.
What is the impact of the future generation?
And god knows, we will be the witness of the modeling of the future generation of Economic imperium.
But the cause of this happening is very composite .it has starts many decapods ago in the 1970’s china just when the country starts to transfer its economic policy apart from communism, and extra towards capitalism.
And early they started to prepare some fixed economic zones where they would able to build the ports and factories which leads to an increase in productivity and efficiencies. And at the time when these economic zones were unlocked for foreign trade and investments. The economy of china started increasing rapidly.
What used to happen in the early times?
In the 1980’s round, 500 companies have started preparing their products in China, and the reason was that china made their products with Some How of equal properties, but the production cost was lower than if the products were produced in the west.
And this happens for the reason that the wages of the workers in China were very less in comparison to the west. So suddenly, if the challenger will produce their product far from china, then that will leads to the perfect price competition and china’s competitor can’t compete for the price, and this will bring the monopoly of China.
And due to all of these things, till 2010’s all the goods were on the earth were produced in China.
During the time of 50 years, China has converted its economy from an unknown economy to the second-largest economy in the world, Some How behind the United States. However, some unusual things started occurring in the past few years.
So the question arises is; what would be the situation of the country, who increased its economic condition with the help of low labor cost, and suddenly becomes victorious and rich?
Describing the state and condition
During 1990, the average annual wage of Chinese labor was near to 150 USD. In 2005 it was 2800 USD. In 2015 – 8900 USD and the beginning of this year, the average income of Chinese labor is around 13500 USD.
That was huge growth that was ever seen in the average wage rate of the labor has increased by 8500 percent in the 30 years.
And this specifies that the cost of manufacturing products in China had become much more costly in comparison to the past years. And due to this, we observed the decline in the production process in china during the year 2016, for the very first time in the past 50 years their production output was decreased by 2 percent.
But that was not a very big deal, after 2016, again china increased its production unit. As late as the United States implemented traffics on the imports from China. This leads to a fall in Chinese imports to the United States by 7 percent during the year 2019. and pushed many companies to start searching product sourcing in other different countries.
How china came to play?
From then china started participating in the world’s tech sector.
And from that time, the Government of every country was continuously trying to propel the Chinese technology out of their geographical boundaries. And also providing funds and motivating their domestic business to manufacture their product instead of using Chinese products.
The matter of fact is that the last week, the justice department in the united nation has pleased to FCC to bring to the end that China’s telecom authorization in the US, mention it as a national security risk.
We can see that even with all these complications China remains the largest producer in the world.
Due to the pandemic, the manufacturing sector is stopped in china, and countries that depend on China for their manufacturing process are now helpless. They are dying because they can’t produce things in their own country. They have no backup now.
China is the second-largest manufacturer of drugs and medicinal ingredients and equipment in the world.
During the year 2000 the country named Vietnam going through extreme poverty with all over its population of one million people. The per capita income of Vietnam was around 390 USD at that time. The payroll companies like NIKE and others started to manufacture their products in the country because that leads to the low cost of production because of poverty. When other companies noticed that the manufacturing sector is cheaper in Vietnam in comparison to China, they also shifted to Vietnam. And this leads to a decrease in the manufacturing sector of China.
After that Vietnam is counted in a good income country and its GDP Raised to 3000 USD.
Mexico also gets benefitted from the decrease in the china manufacturing unit during the last two years. In the future, Mexico will become the manufacturing hub of the world.
India is having a nearly equal population to china. But more than half of India’s population is dependent on agriculture for their livelihood but the GDP of India is increased by 1690 USD in the last 18 years. India’s increment has come from the service providing works like banking, etc.
But during the year 2014 India has started manufacturing smartphones and at the end of the year 2019, India became the second-largest Smartphone manufacturing country in the world. In India, big Smartphone companies like Apple are establishing their manufacturing industries in Chennai. This will work for the development of the country. In the future, many more manufacturing industries will set up in India because the cost of production in India is lower than the coast of production in China. Because the wage rate in India is lower than the wage of china.