Author: raymondusa

Taiwan: Stop Trading with China [Copy link] 中文

Rank: 4

Post time 2006-1-18 07:50:30 |Display all floors

china's leverage

again i said china's consumer spending has to pick up or else companies will start moving to india (80% of companies interviewed by Forbes are prepared to invest more in india)... taiwanese and many foreign businesses in china still hold the management and tech edge, and it's wrong to say that china can sustain a healthy growth without knowledge transfer from taiwanese businesses. even hu jingtao knows how important this exchange is for china's industries... plus when you talk about job growth, the job situation in china is a lot worse... millions of college graduates are unemployed every year. and comparing taiwan's internal and external debts and budget deficits, it's really not bad at all compared to many countries... such as US and the UK... the later, for example has a credit card debt of 80 billion pounds while the former has budget deficits of hundreds of billions.

it is undenialbe though.. that taiwanese people will get a lot a lot richer by opening links with china but to say that china doesn't need taiwan is just outrageous and ill-advised... i know you have china pride, i have it too... but singling out taiwan in china's growth isn't realistic! keep it real fool!

[ Last edited by twchinese at 2006-1-18 07:58 AM ]

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Rank: 8Rank: 8

Post time 2006-1-18 08:34:19 |Display all floors

I criticize some of the Chinese policies, but in private - Ray

Could you voice your distain for American politics in private also?

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Rank: 8Rank: 8

Post time 2006-1-18 08:42:27 |Display all floors

Ray + CD

You make it sound like the world should be happy that China is saving the world.

Did you remember when the world was giving millions of dollars to China when China could not even
feed her own people?

I say China should kiss Richard Nixon. Without that trip to China I think China today would still be poor.

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Post time 2006-1-18 09:24:55 |Display all floors


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Post time 2006-1-18 13:16:40 |Display all floors

When you think this was ridiculous, then I take it as a compliment.  The question was rhetorical, but it highlighted leverage as Taiwan cannot stop trade with China and realistically sustain itself.   It’s the same reason Australia needs to make some practical decisions, if it wants to gain a piece of the domestic Chinese consumption.  Whether you like it our not, Australia has a choice to do business with countries that mainly have cheap labor, or it can do business with a country like China, that in addition to cheap labor, has large domestic savings, and large government spending, stability, and can give countries and companies with the right products and services, a huge market.  Choose wisely, since there are many Taiwanese businesses that have spoken loud and clear as to what they want.  But whether CSB got the message, via the negative reaction to his New Year speech, is questionable!


I’m an American, and consistent with that, I voice my opinions, and examine my own government, openly!  Learn the culture and be consistent will you?  


I agree with you that China will eventually need to unleash that doormat savings onto the world market, in order to keep those FDIs coming, and keep the foreign companies and countries investing!  But the key point here is those whose have savings (China’s liquidity) have the leverage over those who have large debts.  That’s basic finance!   

It’s true that Taiwan’s external, internal and budget deficit is not as bad as US.  Are you looking for a pat on the back?  That’s really not saying much since Japan is the only industrialize country in the world with a higher percentage of debts to GDP.   Is that like comparing an ugly car to an even uglier car, so the ugly car looks better by comparison?  

Taiwan needs to trade with China.  It doesn’t have the leverage to change the regional dynamics.  But I will use your India example just to illustrate leverage.  Let’s say Taiwan is stupid enough to move major operations to India (and this is not disparaging India since I know there are some very smart folks there, but it is to compliment Taiwan because I can see there are smart practical folks there who understand practical tradeoffs over political ideology) China can implement soft power by imposing economic sanctions on Taiwan, and use its leverage to convince other countries not to do business with Taiwan, or it will have no access to China’s markets.  China can also cut off financing since it has substance savings sitting in its Central Bank, and is in fact a world lender.  As Taiwan's debts increase, it will be more vulnerable to lost of financing!        

When you add to that the negative responses by smart Taiwanese business people and how the market dropped after CSB’s New Year speech with the ambiguous language, even you should keep it real enough to acknowledge Taiwan doesn’t have leverage, or it would have used it by now!  Empty threat, but good for some laughs.  Thanks!

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Post time 2006-1-19 09:16:08 |Display all floors

yes, Alexae >>>

Uranium talks
China Daily today reported the uranuium trade:

>>> China started talks with Australia yesterday on safety measures to cover planned imports of uranium from the country, setting the framework for sales agreements.

The talks to ensure that any Australian uranium supplied to China is used only for peaceful purposes will take place in Australian's capital Canberra, and will last for two days.

Great news that China-Australia are trade-friendly powers, now.  It aids Australians, it also helps China.

[ Last edited by chinadaily at 2006-1-19 09:19 AM ]

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Post time 2006-1-19 11:30:15 |Display all floors

It is funny how you say this...

"It aids Australians, it also helps China"

I don't like to be nitpicky but...

how about...

"It aids China, it also helps Australia"

Aid is a very heavy word if you know what I mean.

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