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The Rise of East Asia: Threat or Opportunity
China has turned into an exporting superpower. China produces two-third of all photo copiers, microwave ovens, DVD players and shoes in the world. It produces half of all digital cameras, two-fifth of all personal computers, one-fourth of TV sets and 1one-fifth of car radios. Most of course, are made to be sold as brands, European and American brands in brandless factories by a work force which is paid rather less comparatively than our own industrial workers are paid in the Industrial Revolution. That said, 400 million Chinese have been lifted out of poverty by China's extraordinary economic assent.

When I went to Hong Kong in 1992, the average tariff in china were 41%. Since China joined the WTO in 2001, negotiations in which I was tangentially involved as a European Commissioner, Chinese tariff fell to 6%. China has the lowest tariffs of any developing country. So China is not only a huge exporter but a huge importer as well.

Over the last 5 years, China has been responsible for over 1/3 of the total increase in world import volume. In the next decade, China is likely to be the largest importer and exporter in the world. In the last couple of years, China and America has been responsible for half the world's growth overall. China, because it manufactures often below cost what the rest of the world wants to buy, worth noting that Wal-mart is a larger trade partner of China than either Australia or Russian. And America's contribution, because America is able to borrow spectacular amounts in order to buy whatever the rest of the world makes. The saving of Chinese peasants in a bizarre twist, are pooled into the purchase of American Treasury bonds.

So China tears along at a breakneck pace, about 9 ½% a year at the moment, attracting more foreign direct investment than anyone else, between 50-60 billion dollars.

Should we believe those Chinese statistics? Well, the usual response, of course, is that we shouldn't. On the other hand, China did discover a few months ago, that the economy was actually a lot larger than were previously thought. The Chinese Authorities discovered an uncounted economy about the size of Turkey. So whatever you say about Chinese statistics, the right reaction, it seems to me, is what is happening in China is what Christopher Columbus wrote on the margins of his copy of Marco Polo Travels, mercacciones innumeras "an incalculable amount of trade."

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