A few years ago, China started to become the dominant world supplier of goods such as microwave ovens, photocopiers and artiﬁcial Christmas trees. Now it is producing signiﬁcant quantities of fairly sophisticated items like memory chips, computers and mobile handsets, and moving into new territory such as telecommunication switching systems. The software for these products might also easily be developed in India where all sorts of services are being provided.
Can these giant economies maintain their advantage?
The growing competitiveness of Chinese manufacturing means that companies are increasingly relying on China as a source of products and components. Sometimes this is achieved through subsidiaries and in other cases by sub-contracting to Chinese companies.