Businesses all over the world have seen China gobble up the toy industry, and they now look on in horror as it does the same for shoes, fridges, microwaves and air conditioners. This country of 1.3 billion people has an apparently inexhaustible supply of workers, willing to work long hours for pitifully low pay. Boosted by its accession to the World Trade Organisation, China is sucking in foreign investment by the bucketload-last year, it became the world's biggest net recipient. How can anybody compete against this gigantic new workshop of the world? There is no doubting the immense impact of a surging Chinese economy; or denying that for many, adjustment to the arrival of a new industrial goliath will be painful. But most of the economic fears that China arouses-that it will drive everybody else out of business, that it will always be super-competitive in everything, that it will cause mass unemployment-are plain wrong. They ignore all the benefits of China's growth. They also ignore elementary economics.
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