Business Opportunities for establishing a company in China

ABSTRACT

In this paper, China does indeed appear to offer the new marketing bonanza among which the other WTO members seem to think. This despite the fact that, even with political concessions and further open access to outside foreign direct investment, the Chinese landscape has enough bureaucracy and is still xenophobic enough in nature that there will continue to be substantial barriers to entry for years to come.

The Chinese, however, have already started to learn how to play the game outside of their borders by purchasing into new resources and establishing business presences outside of China. This unbalancing of access may prove to be a powerful competitive advantage for China in its progression from a planned economy to a market economy.

Long term, the principles of Guanxi and the strong relationships that develop as a result may serve to undermine the economic power of the US within two generations. This is a potential outcome primarily due to the progress that seems to be taking place within China, especially in areas such as pollution control and environmental sensitivity which seems to be playing a major role in development activities.

Short term, China is going to solve the challenges discussed in this assignment successfully and that it will be become the world leader in business. Increased access to the cash economy will create clashes between poor rural workers and more upwardly mobile urban jobs. As people try to move from the rural areas to the more urban areas, we will see an increase in the truly impoverished and greater class distinctions as both incomes and consumerism increase. While this will create greater opportunities for outside businesses, the unrest it will create politically may prove to limit China's competitiveness until these changes find their own equilibrium.