Essay Preview: LifeReport this essayChantal GuedonGlobalization and Global GovernanceDoes Integration Brighten Chinas Economic Future?Currently, China has one of the largest economies in the world and every year it is impressive to see the growth that the country endures politically, socially, and economically. The progress of China is due mostly to globalization and the integration and support from the west. With the size and potential of China there was always a question of whether or not it would be appropriate to expedite Chinas integration into the modernized world and if there would be a backlash against what was inevitable. Since the fall of Communism following the Second World War, China has resorted to a socialistic economic standpoint which has increased its productivity and the cash flow within China itself. It is hard to argue that globalization and the opening up of China has been nothing but beneficial. However, the intense growth that China has endured over the past few decades has been so fast that there are many loops in its economy leading to detrimental ramifications to Chinas people, labor market, and fiscal sustainability.
A nation who is subject to globalization is seen as a nation willing to adopt a homogeneous viewpoint on all economic and political issues while giving freedom to foreign investors, jeopardizing domestic industries. China has done many things to benefit the world economy and has definitely been a great support system as it has slowed down in recent years. Although the progress that China has made is amazing, there are still many aspects in its policies that are beneficial for the global free market economy; however, these economic structures are detrimental to local businesses. The openness that China has agreed to has allowed a taxing amount of foreign investment that is more than likely to squeeze out all of local Chinese investors, companies, and competition. According to author yang this type of foreign investment has lead to the “flounder of investors” of local businesses (Yang 2004, 118). Another argument is that and the process of globalization went too fast and China was unable to keep up with the changes, resulting in a poor labor market outcome. This argument is mainly based around the fact that unemployment is increasing while the most of the major industries are controlled by the government leaving a limited amount of room for local business to thrive in the market. In the long run, unless the Chinese government takes action to increase the private sector then the largely expanding economy of China will come to a halt and quickly reverse itself. Other than the local business being hurt by foreign investments and industries, the labor market in China is suffering from major unemployment. According to a paper written by an International Monetary Fund official, “the unemployment problem is in fact likely to worsen over the next few years due to restructuring in the rural and state enterprise sectors” (Prasad 2004, 6 ). The type of restructuring that the author notes is what has been mandated upon China by the World Trade Organization. The WTO was too big of a restructure step for China. In a global sense, Chinese involvement in the WTO is great for foreign investment and bad for local investment because “one of the first laws enacted in the reform era was designed to attract and protect investment from overseas” (Yang, 2004 307). However, the real detriment is with the local government in China not receiving proper adjustment to Chinas globalization. While the Chinese Central government is doing well with WTO policies, many of the local governments are being left in limbo between their old policies and their new ones. There is a great amount of “underdevelopment” in Chinas legal system and local governments which “has required significant adjustment on the part of China.”(Yang, 2004 307). As stated before the Chinese Central government is doing well with these adjustments there seems to be no force on the local governments at any level, leaving them in their state of underdevelopment. The harsh effect of this is the lack of faith by the people in their government and also the failure of local government investments.
The unemployment issue leads to a bigger issue. With the lower classes in the Chinese society reaping the bad effects of Chinas integration and the upper classes gaining all the rewards, there is a definite social strain on the Chinese society. According to authors Street and Maelski their biggest argument against China joining the WTO is the cultural ramifications because currently Chinas WTO involvement has “cut deeply into the fabric of Chinas social order” (Street, 211). The specific ramifications that they speak of is the enlargement of the gap between the rich and the poor and as a result of this “social unrest may spiral out of control” (Street, 211). This proves that the government is currently condoning the needs of the Chinese people.
Consequently, many Chinese organizations are considering that a new “Chinas” treaty is really necessary. This would mean strengthening the rights of civil society organizations, strengthening the “nationalized” system such as the People’s Republic of China, and creating a kind of theocratic/communist system with less to gain from joining and reaping the benefits of international trade. If these changes occur, there probably will still be a chinese government which would be better able to support and support all of these movements.
Another argument is that the Chinese are better off without their labor systems and the way they organize their own society.
But the truth is, you can’t actually get into that if the Chinese don’t. So the best way to deal with this is through the Nationalization of Labor in the Chinese economy, or even if it means changing the laws on labor and some other matters.
One of the most commonly used forms of workers’ control in China is the Nationalized Labor Contract (NOL) system, which is a trade union. This is one of the oldest forms, but is considered one of the major forms in trade unionism of the 20th century. NOLs are labor workers who organize their own organizations to improve workers morale, to make sure better wages do not come through in their communities. In some places, these people manage to get together to negotiate a wage, but they cannot do it without unions, so many work outside of their existing structures, meaning that they lack a true union. In countries outside of China, when working under NOLs the prevailing wage is often paid by labor, and often by the employers which may or may not have a national working relationship to the government. NOLs must also pay for training, equipment, etc. and for being able to work under NOLs (Street, 216-217).
Many working class and non-working classes are frustrated and upset with the state of their conditions. They believe the Chinese government is doing good by forcing them to pay for labor, even though it is very bad by not doing so. This may be why some feel the Chinese government is “reaping the good effects of Chinas unionization” and the rest blame the government for causing the problem, or it may be because they think others are doing the same stuff on their own.
But one cannot control the way of how workers organize without government control. When people do strike or strike, the government takes action against the labor unions and is expected to do things accordingly. So it might be argued that the Chinese government is not doing good by doing this, but in practice it is doing all the things it sees fit in the Chinese way. To be specific, a new NOL might be needed every 12 months so in this case it would have to be renewed every 2–5 years. The Chinese government is supposed to do this every year through the system of Labor Law. The Chinese government is also supposed to have NOLs (Street, 217), which should
One argument that justifies the positive effects of globalization in China is the increased GDP and the fact that China is the worlds sixth largest economy. Supplementary to Chinas globalization with the rest of the world, in 1999 China signed and agreement with the United States allowing it to be a part of the World Trade Organization. Not only has Chinas imports and exports been increasing by dramatically every year, their addition to the World Trade Organization has increased that percentage even more. Chinas growth in terms of imports and exports have surpassed the growth of world trade. Chinas choice to integrate also leads many to the conclusion that the increase in competition between companies is directly beneficial to the Chinese people. The reasoning behind this is economically viable. An increase in competition means the lowering of the pricing of goods, which is, as a result, helpful to individuals because they are presented with a larger selection and choice of product.
Chinas accession into the World Trade Organization has proven most beneficial to the rest of the world rather than China itself. While China is changing its internal policies and undergoing substantial change that is hurting Chinese businesses, the rest of the