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Jens Hansegard interviews IKEA China head, Gillian Drakeford. Drakeford an employee of IKEA since 1988, has run the Chinese operations since 2003. She talks about how IKEA approaches the Chinese market. IKEA's Chinese sales in 2011 fiscal year ending Aug 30, were 4.9 billion RMB, 20% larger than in 2010, with 20% growth seen so far in 2012. Its plans are to open in 2nd tier cities with opening stores in Chongqing, and Wuhan. It has opened stores in Chengdu and Tianjin. The way IKEA opens stores is in partnering with its IKEA Centre Group which owns and manages shopping centres. In Wuxi, Beijing and Wuhan it will open stores with shopping centres of this type. The IKEA customer is 25-35 years in age with relatively higher incomes and education who finds a westernized lifestyle appealing. Space is a constraint, and there is the added factor of more stuff needing to be stored with more products available. A multigenerational family may live on 70-90 square metres. IKEA's challenge is to show how to deal with limited space, keep lowering prices to remain competitive with local competitors who are catching up to new retailing trends of IKEA type stores. Because Chinese middle class means much lower incomes than in the EU, the key is to meet affordability goals, and keep lowering prices for value. IKEA's "Lack" table has come down from 120 yuan to 39 yuan, and since 2000 it has cut prices on average by 60%. IKEA uses China's microblogging site Weibo to reach customers- where it puts up announcements and customers ask for tips, suggestions and put up their own pictures....

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DeepSeek China displacing OpenAI/Microsoft in the US, and becoming the most downloaded app on Apple iPhone download rankings, doing the same work at 5.6% of the cost, is leading to a national revival sentiment in China.

Deep Seek is based in Zhejiang province. The state website says of Deepseek's achievement-

“We need to believe that the moon in other countries is not necessarily rounder: Whatever others can do, we can also do it and even do it better.” 

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Efforts to prevent the arbitrary abuses of the judicial system by local authorites in China.

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Canada is joining a club of nations that are dependent on exports of raw materials to China for growth- Australia, Brazil, Malaysia and Peru. This means that Canada's central bank takes its cues from demand in China, India, Korea and other emerging economies when it sets rates. With Canada's growth at around 3.1% in 2010, Canada's central bank is expected to increase rates gradually even as the U.S. keeps its rates low.

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China is closing energy inefficient aging factories. The Chinese government plans to close 76 factories in cement, 279 in paper, 175 in steel, and 84 in leather as part of this effort. This still leaves China with a lot of work to do to acheve the 20% reduction per unit of economic output in 2010 compared to 2005, that its current five year plan calls for. Efficiency went up by 14.4% in the first four years of the current plan, but went down by 3.6% in the first quarter causing serious concern.

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China's July 2012 exports were up barely by 1%, over the same month prior year. Exports to the European Union declined by 16.2%. A big problem is cost increases for land, labor and electricity. By 2004 China's exports were growing at a peak rate of 35%. Since then prices of inputs have increased- wages by 150%, land by 70%, and electricity prices by 30%, according to Dragonomics. The yuan appreciated by 30%. Productivity is increasing by about 8% a year, according to the World Bank. As a result of the price increases of inputs the competitiveness of China, with products exported mainly on the basis of price, is deteriorating.

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Apple CEO Cook and manufacturing base in China deference to China security laws to keep a foothold in China. Under Cook Apple held off on diversifying its manufacturing base in China, leaving a legacy sure to be questioned as concentration of supply chain in China has serious repercussions on the manufacturing base of US, EU and India. No participation from Apple in reversing the dangerous deindustrialization of the US, not even an open discussion at Apple and its partner companies, a legacy that will come more and more in the spotlight long after he is gone.

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During 2012 and 2013 the U.S. put pressure on China and India to cut oil imports from Iran to increase the effectiveness of sanctions. As negotiations eased the sanctions, China increased oil imports in 2014 by 30% in 2014 over the prior year. China's Foreign Ministry sees a "win-win spirit" in the nuclear deal that opens up economic relations with Iran. Analysts say China has setup three new storage facilities on its eastern coast with about 45 million barrels of new capacity, which could be filled with new supplies as its growth slows and demand decreases. China's imports were about 7 million barrels a day in June 2015.

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The actual text of the Feb. 1, 2025 Executive Order  from the White House and president DJT says about the flow of fentanyl that has taken the lives of more of America's young people than the wars- the Korean War, Vietnam War and the First World War combined. That is the astonishing story of what has happened to American society over the last two decades. "The influx of these drugs to our Nation threatens the fabric of our society.  The PRC plays a central role in this challenge, not merely by failing to stem the ultimate source of many illicit drugs distributed in the United States, but by actively sustaining and expanding the business of poisoning our citizens." What the US Supreme Court and Justices Roberts, Thomas, Scalia, Barrett, Alito, Gorsuch, Kavanaugh, make of this one can only guess. One has only to walk from the US Supreme Court Building to the faces from the 1950's at the Korean War Memorial to get a sense of what the Justices have to be thinking.  ...

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A government report gives a second by second account of a high speed train collision in China on July 23, 2011. It shows major equipment failures, human errors, and confusion in communications.

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Robert Reich, a former Labor Secretary, says that instead of "rebalancing" with Chinese consumers buying more American goods and China exporting less to the USA, things are headed in the opposite direction. Why? Because at the macroeconomic level China is devoting more of its country's resources to production capacity. Chinese consumers are taking home a smaller proportion of the total economy. In 2008 personal consumption amounted to 35% of the total economy, whereas in 1998 it was 50%. Capital investment in the same 10 years went up 35% to 44%. Chinese continue to save and these savings are going into infrastructure and manufacturing capacity. There is even a social twist to the savings, with fewer young Chinese women than men parents with boys have to compete in the marraige market and save assets for this. Households are also saving to support more elderly people as population is aging quickly with population policies. All this means that with all the talk (see links to Niall Ferguson and Krugman), the situation will likely roll on in this manner till things reach an impasse, or there is a strong political backlash in the USA which leads to stronger trade actions by the government, or there is a crisis. Meanwhile the trade deficit is headed higher and Chinese foreign reserves will go far above the current $2.3 trillion. And the Europeans will also be getting restless with their trade imbalance, as the euro edges higher and the yuan remians pegged to the dollar, leading to trade distortions. ...

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Researchers at MIT, Peking University, Tsinghua University, and Hebrew University, have released a report on the dangerous effects of air pollution from the dependence on coal for energy in China. The report shows that areas in northern China north of the Huai River in central China -where coal use is much higher with government support than the area south of the river- have about 5 years lower life expectancy than areas south of the river.

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Keith Bradsher visits Guangzhou, China, just as prime minister Wen Jiabao tells the National People's Congress that China is changing its priorities from high growth to sustainable development. As recently as 2007 GDP growth reached 14%! The minimum wage is expected to rise 13% each year under the five year plan. Even with the increase in wages owning an apartment is unaffordable in Guangzhou- a 1000 square feet apartment costs upward of $300,000, showing the extent to which the bubble in real estate prices affects young people who cannot afford to own an apartment. A new graduate with marketable skills such as computer engineering makes about $6000 a year, putting owning an apartmet beyond reach. Another change he notices today is that during visits to construction sites he does not see flood lit sites at night. This used to be the case because builders were scrambling to build. With government policies discouraging the property bubble there is no longer a need for work at night. The focus now has shifted to build low income housing....

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The Bureau of National Labor Statistics in China says China's GDP growth for 4th quarter 2008 was 6.8%. Private economists expect growth to slow to something like 5% in 2009 as the full brunt of the housing downturn and the drop in exports manufacturing is felt this year. Housing and exports were the two engines that helped China to reach 12-13% growth rates for 2007 and 2008. 2008 was also the year of the Olympics, and it now appears that by excessive growth and production capacity in many industries and increasing exports China may have created severe imbalances in the world economy. One way this happened is through the huge and ever increasing trade deficits with the US. By reinvesting the money in US Treasurys, China made a huge wave of liquidity and cheap credit possible in the US creating a bubble economy. The other is through the inflated demand in commodities like oil from the Middle East and countries like Russia, and demand for iron ore and other metal commodities from places like Brazil and Australia. This put upward pressure on the prices of commodities, creating a bubble in the price of oil. With the bursting of these bubbles the economies of Russia, Brazil and Australia and other countries are in a deep nosedive. The effects have operated in myriad ways, including a circular effect of the bursting of the credit bubble in the US leading to a collapse of demand in the US market for Chinese goods. In turn the collapse in demand for German and Japanese goods in China with declining demand, as the effects moved through the channels of the international trading system. The decline in Chinese demand also affects the US ability to make a export driven recovery....

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From 1990 to 2008 most other developing countries did better in increasing life expectancy than China- this includes India, Indonesia and other developing countries.

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Researchers David Autor of the Massachusetts Institute of Technology, Gordon Hanson of the University of California, San Diego, and David Dorn of the Center for Monetary and Fiscal Studies in Madrid, in independent research, studied the impact of trade on 722 clusters of interrelated counties in the U.S. They focussed on the surge in Chinese imports and found a pattern. Counties with higher exposure to Chinese import growth showed higher unemployment and higher expenditures by the government for unemployment benefits, food stamps and disability benefits. Their calculations show the increased government payments amount to one to two thirds of the gains from trade with China. This does not include the losses suffered by people losing jobs who deplete savings as they look for new jobs. Hanson studied the effects of trade and Chinese imports in the 1990's and found the effects were relatively small. This time the effects are large and show counties that lacked local investments in industrial machinery and technologies in which China was still playing catchup such as Caterpillar in Peoria, Illinois, and Boeing in Everett, Washington, were most susceptible to higher jobless rates and in need of government support payments. Autor and Hanson found that from 2000-2007, communities in the 75th percentile- ones with greater exposure to Chinese import growth than 75% of all communities- saw a manufacturing jobless rate of about one-third more than communities in the 25th percentile. The government payments mean higher taxes or larger deficits are needed to support these communities, and long periods of unemployment reduce the incentive to work. Michael Spence, a Nobel prize winning economist from New York University, says the world has never seen such a rapid pace of growth as China experienced between 2000-2011, with rates approaching 12% in some years, making past experience and prevailing theories on trade an insufficient guide to what is happening....

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With the strong positions taken by Clinton and Trump on China in the 2016 election campaign, U.S. relations with China enter a new phase. The strident tone in the campaign on China on trade deficit, women's issues, human rights, comes with the issues relating to China's role in the South China Sea and cyber espionage already in the background.

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GM sells just 30,000 Cadillacs in China. It is one of 8 brands with total GM sales of 2.8 million vehicles in China. The luxury and premium vehicle market is growing in China with 8.5% of the total vehicle market in 2012. GM's 30,000 Cadillac sales makes Cadillac at only one tenths of one percent of its China sales volume, and way behind luxury car makers Mercedes and BMW. GM plans to take a larger share of this market and increase Cadillac sales to 100,000 by 2016. To do this GM will launch a new advertising campaign in China with actor Brad Pitt and increase dealers in China to 200 by the end of 2013. A new Cadillac will be introduced every year through 2016. Cadillac comes in the SRX, a small sport utility vehicle, and the XTS, a full size sedan. A 8 cylinder Cadillac, the SLS, will be discontinued.

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Australia exceeded China in total revenue for GE by $100 million, with $5.8 billion in revenues. GE now sees resource rich countries providing revenue growth of 25% in the next 2 years compared to 10-15% for China and India. The Ichthys $34 billion LNG project by Total SA and Inpex of Japan alone generated $1.1 billion in contracts for gas turbines, compressors and underwater production systems. The Gorgon project of Chevron on the northwest coast of Australia generated $1.3 billion in revenue.