Global Fastener News

Taylor: China is Net Importer with Huge Consumer Potential

Jason Sandefur

As head of East-West Logistics, Jim Taylor is often asked when manufacturing jobs will return to the U.S. and things will get back to normal. “If you truly believe that (is going to happen), you”re really missing the boat about what”s happening in China and the world,” Taylor replied. Speaking at the conference “Dragon Fire: The Impact of the People”s Republic of China on the U.S. Economy,” sponsored by the Western Association of Fastener Distributors, Taylor and co-speaker Bruce Darling of Porteous Fastener Co. said China has transformed itself during the past two decades from a rural economy into the””world’s factory.”
Some international analysts predict the 21st century will belong to China, Taylor commented. More than $500 billion in foreign capital has poured into China over the past 10 years, driving double-digit growth in the Asian country. “Foreign companies have basically built China’s infrastructure. It’s all being paid for by the rest of the world,” Taylor explained. With cheap land, cheap labor, and basically no taxes on profits, China has leapt onto the world stage as an economic powerhouse with no end in sight. “We think of China as a communist country. In actuality, it is the single oldest, most established culture in history. For the past 2000 years, China has been more capitalistic than any other country. There is no one more capitalistic in nature than a Chinese person,” Taylor noted.
But China is not simply the world”s largest source of inexpensive workers. It”has become a giant consumer that”is gobbling up the world’s resources. In 2004, China will import more goods than it exports. “In our lifetime, it will be the largest marketplace in the world.”
China’s seemingly endless appetite for steel has contributed to worldwide shortages that have affected the fastener industry and numerous other steel consumers. Darling and Taylor told distributors at the conference that price estimates for steel over the next year range from 5% to as much as 20%. “I’m not here to tell you the price increases are over,” Darling noted. �2004 FastenerNews.com