vol. XVII no. 1

				In Dependence continued The war in Iraq was one of the biggest challenges for Coca-Cola Eurasia this past year. With the declaration of the end of the war, the company is making inroads in Iraq. Importers buy Coca-Cola products from neighboring countries and sell them within Iraq. Future investment is subject to infrastructure developments and stability, according to Bozer, whose additional challenge last year was the integration of the Middle East region into the Eurasia division. The Chinese Century? Further east, China is having its own impact on the U.S. domestic economy. During the past decade, China's economy has been growing in leaps and bounds — some 9.1 percent in the last year alone. The International Monetary Fund ranks China's share of the world's output of goods and services at 12.7 percent, double that of 1991. By comparison, the European Union's output is 15.7 percent and America's stands at 2 1 percent. The Chinese have a seemingly endless workforce on which to draw and a growing mass market. A recent New York Times article pointed out that China, with its 1.2 billion people, is supplanting the United States as the principal trading partner for several countries, including South Korea. With its growing mass market, China holds "the promise of consumption on a much greater scale than in the United States,'' the article estimated, predicting that while today America's mass market is second to none, "someday it will just be second. ''The conclusion: The 21st century is unlikely to be the American century As with Europe, currency valuation is at the center of controversy between Americans and Chinese and other Asian countries. But unlike the escalating euro, the Chinese yuan is being kept unnaturally low, thereby giving China a big cost advantage. The United States has been pressuring the Chinese government to let the markets work and allow its currency to rise against the dollar, a move that would raise the price of Chinese imports in the United States and begin to correct China's huge trade surplus here. At the end of 2003, the Commerce Department placed import quotas on Chinese textiles and tariffs on television sets to help correct the surplus, but it will take a big tariff to slow the $l46 billion of Chinese manufactured goods imported to the United States in 2003. "The Chinese are accumulating huge surpluses in dollars, but where is the surplus going?" White asks. "They have tens of thousands of people overproducing widgets that no one wants in factories they can't shut down.'' White doesn't accept China's dominance as a foregone conclusion. ''When you consider China, it is true that growth and development are taking place, but you have to consider China in the context of things people aren't talking about. For instance, the four major Chinese banks are bankrupt. The Chinese have no common code of law. For several years, their rural residents have been in distress because of high rent charged by the Communist party on local land. They end up in the city looking for jobs, unemployed, floating. Now AIDS is showing up in the population. The society is aging, and they have no social welfare.'' A huge disparity of income also plagues China. ''Yes, some have progressed," White says, ''but hundreds of millions have made little or no progress, What good is it if a guy on a farm has access to television but no access to plumbing or a health care delivery system?'' White — as the head of an organization that conducts conferences, briefings and seminars with international experts and world leaders - has a unique vantage point from which to view global impacts or the U.S. economy. Despite competition from around the world, he judges the long-term prognosis as very good. What trump card does the United States hold? White believes it is that we embrace immigrants. "We are the only country in the world that can accept foreigners and make them our own. The French, who need immigrants to fill jobs in increasing numbers, are running into trouble with Islamic fundamentalists. After 50 years of living in Germany, the Turks there aren't considered German. Japan doesn't even acknowledge the presence of foreigners. "We have a different tradition. If the United States learns to be a team player, to find its place among the other countries of the world, it will prosper and provide the same leadership in this century as in the last.'' In other words, the future of the United States may depend not only on the recognition of its responsibility as a world leader but also on its dependence on the very nations it leads. Top | Back to Beginning

Copyright © 2004 Robinson College of Business/Georgia State University.