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China: Is It a Threat or an Opportunity?

April 12, 2012 | Comments: 0 | Views: 164

Since the 'International Downturn' took hold in around 2008, for the most part, the world economy has been on a downward momentum. In Ireland this downward trend has been exacerbated by the 'building boom/bust' which aligned with the failure of the Irish banking system has left the economy dependent on financial support from the IMF and the EU, and in quite a precarious position that requires drastic action by the government in the form of austerity cuts and tax increases across all sections of society.

In this environment there are are a few schools of thought; all with their own merits, some believe that indigenous small industries is the way forward, others talk of success coming from the ability to increase our exports, others again talk of the need to regain our competitiveness, and more speak of foreign direct investment. All of these are activities that can without doubt assist our ability to recover.

China has the capability to assist or contribute to all three of the above mentioned areas, and it is understandable that people would have a fear of a small country as Ireland being 'under obligation' to such a large country as China.

China has a lot to offer to countries such as Ireland.

First of all it has a huge market into which Irish businesses can export. We have seen missions to China including Taoiseach Enda Kenny with a view to increasing exports and trade, and we have seen a deputation from China including the Vice President Xi Jinping visiting Ireland in recent times which shows that there is a heightened awareness of the potential.

Secondly, China is still a low labour-cost economy, and there is potential for Irish businesses to purchase lower cost components and products, to allow them to reduce their cost base and become more competitive, helping them to remain in business through the current environment. Already many Irish businesses are purchasing from Chinese suppliers, however many are reluctant, having heard 'horror stories' of scams. It is true that there are scam operators in China, but in truth they exist in many other countries too. With due care and attention, and advice from experts, this uncertainty can be removed and the experience can be straightforward and beneficial.

Thirdly, there is the opportunity for Foreign Direct Investment. This is most likely a longer term option, however it must be recognised that China holds a great deal of wealth and not doubt will be looking for places to invest money for a good return. The investment could come in the form of buying bonds, or alternatively in setting up operations in Ireland or buying into Irish businesses. Is this a threat? I don't think so.

Based on the above, from the point of view of the current ailing Irish economy, I believe that China presents many opportunities which should be availed of where possible, and that it will definitely play a part in the Irish recovery. Whether it's a bit-part or a leading role remains to be seen.

Soileire Business Solutions Ltd, Based in Cork, Ireland is a sourcing and importing company. Soileire specialises in sourcing products in China and importing from China to Ireland. We have Irish and Chinese people working for us in China, searching, auditing. conducting quality assurance checks and shipping products.

We can be contacted by email at or our phone details and on the website.

Source: EzineArticles
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