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July 05, 2011

The Chinese competitive advantage

International Journal of Sustainable Strategic Management - The Chinese competitive advantage by Jack McCann

This research evaluated how China is creating its own competitive advantage within the global economy. The concept of competitive advantage as presented by Michael Porter is utilised as the model for the creation of competitive advantage and a benchmark for comparison in this research. A description of how China is creating a competitive advantage politically, culturally, legally, economically, and through its alignment with the USA, EU, and the global economy is described. In addition, the sustainability of this competitive advantage is considered.

Eurekalert - Research from Jack McCann of Lincoln Memorial University, in Tennessee, suggests that China could become the dominant economic power within a few years if it exploits the competitive advantages it is creating politically, culturally, legally and economically.



"On paper, globalization poses the long-term potential to raise living standards and reduce the costs of goods and services for people everywhere," says McCann. However, globalization does not mean equitability. China currently produces almost three-quarters of the world's today, nearly two-thirds of its bicycles, a third of its television sets and air conditioners, and half of the world's microwave ovens. "China's pool of cheap labor may dominate world labor markets for decades, giving it a monopoly on cheaply manufactured goods," McCann explains.

There is an intriguing undercurrent to China's development and trade practices that concerns those in the West. "Competitive strategies, currency manipulation, and piracy of intellectual property are causing concern in the global economy and creating protectionist reactions in many countries," adds McCann. It is interesting to note that as China utilizes its various competitive advantages, not least those ethical considerations, it has in recent years become the world's second-largest oil consumer after the US while the US trade deficit with China increases year after year into the hundreds of billions of dollars. Globalization has wrought new opportunities for many nations. China is no different than any other in attempting to make the most of this emerging world order.

Jack McCann webpage at Lincoln Memorial University

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