Small Business Labs

"The Elephant and the Dragon" - The Rise of India and China

Recently read the book "The Elephant and the Dragon - The Rise of India and China and What It Means for All of US".  It provides a easy and fun to read overview of the amazing growth going on in both China (which I discussed in a previous post) and India.  The book has lots of interesting data like:

"...in 2000 30% of the world's toys came from China.  Five years later, a stunning 75% of all new toys were made in China."

It also discusses how the economic growth of China and India is reducing global poverty.  Key quote:

"The combined growth of India and China during the past two decades has cut the portion of the world living in extreme poverty from 40 percent to 20 percent..."

It is obvious that China and India will both have a major impact businesses of all sizes over the next decade.  They are already providing stiff competition for a variety of US businesses and industries, but their economic growth will also create new markets and new opportunities.

 

MSN Series on China - Keeping Up With The Wangs

MSN has a series of articles on China and the growing Chinese middle class.  It is in their investing section, which is interesting in its own right in terms of how we tend to think of China.

The continuing growth of China and the scale of the growth is hard to comprehend.  My favorite part of the series is called "Four New Manhatten's a Year" - called that because China is basically adding 4 urban centers the size of Manhatten each year.  They describe the growth of Shenzhen, a rapidly growing city in southern China that was a small fishing village 20 years ago.  Key quote:

"So rapid has been its growth that virtually none of its 9 million official residents (or its estimated 8 million illegal and unregistered ones) were born here."

I visited Shenzhen in 1990.  My guess is at that time it had no more than 5000 residents and I only saw one car in town.  There were no signs of industry or commercial buildings of any size.  It was simply a sleepy fishing village.

Shortly after my visit it was named a special economic zone and targeted for growth by the Chinese government.  I returned in 1995 and there were over 1 million people living there.  There was a downtown area with large office buildings, new factories and warehouses in various stages of construction ringed the downtown and auto and truck traffic choked the streets.  Now it has over 15 million residents.  Simply amazing.

Everyone, including entreprenuers and small business owners, needs to be aware of what is going on in China (and India).  The size and growth of these markets is fundamentally changing global economics and greatly increasing the forces of globalization. 

GEM on China and India

One of the most interesting findings of the 2007 GEM report (see prior post describing GEM below) is the entrepreneurial differences between China and India.  According to the GEM report:

"The world’s two largest emerging economies, China and India, exhibit significantly different levels of high-expectation and high-growth entrepreneurship.  The difference between China and Indiais over sixfold."

You have to actually dig a bit to see what they mean by this, but if you do you will find that the percentage of high-expectation and high-growth entrepreneurs is 6X higher in China than India (see prior post on GEM or the GEM Report for definitions).  If these differences sustain themselves over time, the two countries will have a very different economic structures and impact the rest of the world in very different ways.