At the risk of setting the wrong tone right from the start, allow me to begin this blog with a review of a recent newspaper article I read.
Since the original is in Dutch, I’ll present you with the translation of only those remarks that struck me as surprising – no big deal, I’m a simple man – and those that seemed shortsighted or were even on the verge of being wildly incorrect or utterly beside the point. I had a hard time at selecting those which bothered me most.
As is customary in newspapers these days, the article starts with an introduction of the interviewee, a professor who obtained his PhD in the USA and is currently working in Canada. He’s also characterized as being ‘the’ specialist in worldwide production networks.
Pooh. Dare I say more? With these credentials, surely everything that comes out of the mouth of this oracle must be true. Even his opinions must be considered to be hard facts. Even his statements outside of this domain of expertise should be above all doubts.
I should probably stop here. Any normal human being would. Alas …
Let’s examine some of the remarks and statements and try to assess their value:
- ‘The specialist in world-wide production networks nuances the populist disaster scenarios about a rapid shift of all high-tech production to China.’
– As indicated above, ‘a specialist’ would have been so much nicer to all his colleagues, but this lapse may be attributed to the journalist and not to the professor himself.
– What really surprises is the ‘populist disaster scenarios about a rapid shift of all high-tech production to China’: Populist disaster scenarios? Obviously the professor and I do no frequent the same circles, because strangely enough – when talking to the (wo)man in the street – I only hear echos that remind me of the frequent remarks that were made about Japan until the 90’s of the previous century: ‘Fortunately for us, they can only copy. They do not invent. They’re not good at sophisticated products.’
- ‘Researchers estimate that hardly half of the value of the total Chinese export is really produced in China.’
– I really, really hate it when researchers start estimating. I do not need researchers for estimates. I can do that myself very well, thank you. (Sorry for the rant.)
- ‘The impression that the transition to high-tech by the Chinese is going much faster than in other developing countries does not fit the figures.’
– No figures whatsoever are offered to support this statement. Which countries is the professor comparing with? The other members of the BRICS? Or is he referring to Asian Tigers such as Japan & South Korea? Maybe a historical comparative study involving the USA & Western Europe is implied?
- ‘Increasingly the added value of an offer is not in the hardware, the product itself, but in the software and the service around it. And there, to my opinion, Western countries still have an edge, especially on their own markets.’
– Anyone having visited China knows that they will try to sell foreigners crap at a premium. Who could blame them for trying?
– Anyone having visited China also knows that competition amongst Chinese is fierce and for the past decades, service has been the distinguishing feature for the Chinese entrepreneurs.
– Talk to any Chinese expatriate in Europe and you will hear them complain about the lack of service in Europe, about how companies here take their customers for granted.
– That we still have an edge on our own markets, for software and services, is a meager comfort when considering the shrinking markets in the West in contrast to a rapidly booming Asia.
- ‘It is a myth that Western companies massively move their production to China because of the low ages and subsequently ship those goods back to their home countries. What those Western multinationals export from China, mainly goes to the rest of Asia. Out there, they primarily produce for the Chinese and the other Asian consumers, not for us.’
– Again: should this comfort us? Western companies have been moving production to China. And yes, they are not shipping it all back to the West. But that means, they do NOT provide employment here and they do NOT offer their inexpensive products here neither. There is no profit to be made by local sales representatives or small shops from selling these goods or services.
Read the original article in Dutch here: