Next up in the Doing Business in China series: a clip that gives a brief look at one of several central, and complex, parts of the US-China business interaction. This clip has some worthwhile shots of the insides of several Chinese factories -- a relatively new one, and a ponderous old state-owned metal works.

It also introduces an aspect of the "outsourcing" wave that I discussed two years ago in "China Makes, the World Takes": that factories in China, serving US and other foreign customers, are providing a lot of jobs for Chinese laborers, but are also providing a majority of the profits, plus most of the associated design, marketing, R&D, etc jobs elsewhere, especially in the US. The furniture company featured here had never done production inside the US: it was a pure startup, with factories in China and design/marketing/management in the US, to serve a mainly US market. The ramifications of this overall division of labor, and how it might change in the future, obviously go beyond the bounds of this clip (and are considered in the series as a whole, in my book, etc). But this is an opening look.    

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