Towards a conception of the systemic impact of China on late development

Abstract

The tremendous expansion of the Chinese economy since the turn of the century, especially in terms of its external dynamics, is of world-scale significance. It seems to justify the quest for appropriate conceptions of China"s systematic impact on late development worldwide. A large number of scholarly studies have coalesced to analyse two crucial aspects of the impact, namely: impact on the performance of industrialization and the condition of labour in the developing world. This paper seeks to critically appraise and reinterpret the existing studies. The appraisal is not so much a critique but rather an attempt to appropriately position the studies in the systematic context. It is submitted that the existing studies" focus on market competition, as the main form through which China"s impact manifests, needs to be complemented and underpinned by the more fundamental consideration on productive investment. In the direction of constructing a systematic conception, it is further submitted that the China impact can potentially serve as a countervailing force against the prevailing dynamics of the world economy under neoliberal globalization -i.e., the rising predominance of speculative finance that tends to crowd out productive investment, thereby hampering industrialization and worsening labour condition in the developing world.

After the Foxconn Suicides in China: A Roundtable on Labor, the State and Civil Society in Global Electronics

“…Hundreds of millions of ‘new workers’, the majority from the countryside, were drawn into manufacturing linked to global supply chains. In 2018 China’s world share of merchandise exports reached 13%, exceeding that of the United States (8%) and Japan (4%) combined (Lo, 2020: 862). The diversification and dynamism of the ‘Chinese model’, characterized by a hybrid economy of foreign, private and state capital, has simultaneously given rise to profound class and income disparities.…”

“…Foxconn is the largest player in electronics assembly and manufacturing. Dic Lo (2020), considering the contributions of state-owned and domestic private enterprises as well, cautions against characterizing the ‘Foxconn model’ as typifying China’s development. He notes that between 2000 and 2017 real urban wages and the real wage for migrant workers ‘increased on average by 10.7% and 9.7%, respectively, per annum’ (Lo, 2020: 862).…”

“…Dic Lo (2020), considering the contributions of state-owned and domestic private enterprises as well, cautions against characterizing the ‘Foxconn model’ as typifying China’s development. He notes that between 2000 and 2017 real urban wages and the real wage for migrant workers ‘increased on average by 10.7% and 9.7%, respectively, per annum’ (Lo, 2020: 862). Facing competition, Foxconn likewise raised wages to recruit young workers while slashing subsidies and bonuses to offset the costs.…”