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It's incredible how they can plan to create an entire industry by investing so much. It's slightly different from how India approaches such problems by forcing

by harigov 11y ago

It's incredible how they can plan to create an entire industry by investing so much. It's slightly different from how India approaches such problems by forcing companies to manufacture stuff locally. I wonder what approach will work out best in the long run.

hangonhn 11y ago
China does the manufacture locally thing too by jacking up the tariff and then requiring all local companies be majority Chinese owned. It has done wonders for them because that's how they've learned modern manufacturing techniques. Over the past three decades, Chinese manufacturing has improved a great deal now that the premium consumer products are made in China. These massive investments is another tool they have and the track record is somewhat mixed. For example, they completely dominate the solar industry now because of their massive investments in that industry. In addition, they also have the world's largest solar capacity in the world. The problem is that a lot of the capacity is unused because of the lack of transmission lines. So at least their solar investment have generated results but done so with a lot of waste.
fpp 11y ago
"They" can get these almost unlimited monies basically for free from the Chinese banking system while similar funding in the US and Europe ends up with so called investment banking or similar where it will never arrive with new entrants or is allotted to a small group of established players and special interest groups. China is acting similar to what successful (new) raising economies have been doing in the past when they disrupted established (industry) players - my best historic comparison on this would be the transition of Germany from a farm based economy to one of the key industrial nations after the first industrial revolution. While the leading industrial player - the UK - was blocked from progress by overstretched copyright / patent / other protection mechanism of the established special interest groups, Germany provided top down support and access to all necessary means to forward technological progress. Then - while most people in Germany still gained only limited benefits and just a few became very influential / rich, Germany as an overall entity / nation gained massively. At the same time the situation / influence of the UK overall deteriorated - these are of course all longer term developments often spanning more than one generation (30 years).

by harigov 11y ago

hangonhn 11y ago

China does the manufacture locally thing too by jacking up the tariff and then requiring all local companies be majority Chinese owned. It has done wonders for them because that's how they've learned modern manufacturing techniques. Over the past three decades, Chinese manufacturing has improved a great deal now that the premium consumer products are made in China. These massive investments is another tool they have and the track record is somewhat mixed. For example, they completely dominate the solar industry now because of their massive investments in that industry. In addition, they also have the world's largest solar capacity in the world. The problem is that a lot of the capacity is unused because of the lack of transmission lines. So at least their solar investment have generated results but done so with a lot of waste.

fpp 11y ago

"They" can get these almost unlimited monies basically for free from the Chinese banking system while similar funding in the US and Europe ends up with so called investment banking or similar where it will never arrive with new entrants or is allotted to a small group of established players and special interest groups. China is acting similar to what successful (new) raising economies have been doing in the past when they disrupted established (industry) players - my best historic comparison on this would be the transition of Germany from a farm based economy to one of the key industrial nations after the first industrial revolution. While the leading industrial player - the UK - was blocked from progress by overstretched copyright / patent / other protection mechanism of the established special interest groups, Germany provided top down support and access to all necessary means to forward technological progress. Then - while most people in Germany still gained only limited benefits and just a few became very influential / rich, Germany as an overall entity / nation gained massively. At the same time the situation / influence of the UK overall deteriorated - these are of course all longer term developments often spanning more than one generation (30 years).