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Sec.B
CHINA
About country:
• China’s economy is the third largest in the world, after the United States and
Japan with GDP of US$4.91trillion.
• Its per capita income has grown at an average annual rate of more than 8%
over the last three decades.
• It is the largest trading nation in the world and the largest exporter and second
largest importer of goods.
• Chinese money is called Renminbi(RMB),it means “People’s Currency”.The
popular unit of RMB is Yuan.
• Beijing is the capital of China,is located in the 8th zone.”Beijing Time” is the
standard for the whole country.
SWOT ANALYSIS:
STRENGHTH:
5. It will continue to dominate light and medium-tech industries because of the large
market in China and the pool of labor.
Key Money Recipient and Direct Foreign Investment:
3. According to World Bank China will be one of the world's six largest economies by
2020 with Japan, Indonesia, India, and Korea and the U.S.
National Resources
2. Chinese prefer to work with U.S. companies for oil exploration and coal mine
development.
2. 1.2 billion citizens in China and 2.75 billion in the Asian Pacific Region which
equals 10 times the population of the U.S.
4. World's most lucrative market of which China represents one-sixth of the world's
population
Available Labor Base
1. Surplus labor in rural areas and impoverished farm lands and growing 10 million
per year. Estimated to reach 250 million by 2000.
WEAKNESS:
3. Energy, transportation, and important raw materials have remained issues slowin
growth
.
4. Agriculture lacks staying power. Production in cities has displaced rural workers.
5. Average inflation is 15%, and surplus labor has resulted in rising unemployment
and inequalities in income distribution.
3. Roads are jammed with thousands of bicycles, buses, trucks, and taxis.
4. According to World Bank East Asia needs to invest between $1.2 to $ 1.5 trillion
dollars in roads, ports, telecommunications, and power systems during the next
decade.
Education:
Shortages :
2. Transactions are often at a premium over the official exchange rate quoted by the
State Administration of Foreign Exchange Control.
5. Lack of modern pollution control. Sewage, industrial waste, and pollution are
growing problems, and China is home to four of the world's ten dirtiest cities.
OPPORTUNITIES
3. Equity and contractual ventures provide quicker access to the market. Partners in
China can help with the bureaucracy, customer base, and distribution.
1. Opportunity to increase the available electricity to more than 120 million rural
citizens without electricity.
2. Need for $10 billion in foreign funds (about 70% of the total project costs) to build
a dam across the Yangtze River as well as build a hydro station.
3. Demand for foreign loans to construct more than 30,000 km of rail lines and to
build expressways and classed roads.
4. Need for overseas investment in coastal ports since more than 90% of exports are
carried by sea.
1. APEC, the Asian Pacific Economic Cooperation Forum, leaders have a vision to
create the world's biggest free trade region for developing countries in Asia by 2020.
Long-Run Success
3. Lack of modern financial reporting makes the economy less attractive to foreign
investors.
2. Advocate collectivism and not individualism. Citizens have a long-term view and
the rigid educational systems stifle individualism.
6. Must hire Chinese managers to better understand the role of courtesy, sensitivity,
and perception in the culture.
Uncertain Advertising Market
1. Strict advertising rules that ban superlative claims and comparative advertising.
Political Risk
3. Bringing China's mixed market and centrally planned economy into World
Trade Organization GATT.
4. Risk from further market-oriented reform. Revelations between the central Chinese
government and fast growing provinces.