> Financial Times - March 23, 2006
>
> China's competitiveness hit by energy and labour costs
> By Tom Mitchell in Hong Kong
>
> The competitiveness of China's manufacturing industries has
> suffered serious erosion over the past year, according to one of
> the world's largest trade sourcing companies.
>
> Hong Kong-based Li & Fung group, which manages a $7.1bn a year
> trading business, said price rises crept back into the Sino-US and
> EU supply chains last year, after at least six years of often
> "severe deflation".
>
> William Fung, Li & Fung managing director, reported an average 2-3
> per cent increase in the once unbeatable China price its US and
> European clients were willing to pay. He pointed to a "double-
> digit" rise in Chinese labour costs, the revaluation of the
> renminbi and higher oil and energy costs for the shift.
>
> "China's costs are all going up," Mr Fung said. "It is no longer
> the most cost-effective country in the region. Anything [sourced]
> from China has a higher inflation component than from other places
> around the world."
Can this possibly motivate Beijing to veto whatever Brussels- Washington brings to the Security Council regarding Iran or neutralize it before it gets there? But it seems Moscow is slightly more willing to buck it than Beijing. . . .
Yoshie Furuhashi <http://montages.blogspot.com> <http://monthlyreview.org> <http://mrzine.org>