Le défi Chinois6e3bd40146f86f4031f85308

Thirty-five years ago Jean_Jacques Servan_Schreiber's "Le Défi Americain" (The American Challenge) claimed that Europe was in danger of becoming a branch office for American multinationals. A decade later, Japan's rising commercial challenge seemed paramount. Now China makes people nervous. But today's responses to China's economic challenge may be as misbegotten as yesterday's answers to le défi Americain .

China in 2002 resembles nothing so much as Japan in the 1960s, when it was preparing to become a global competitor, with echoes of Dickensian England and America's "robber baron" era of the late 1800s, when the US first rose to global economic power. What is unprecedented is that something similar should occur in a Communist nation, or in one with such a massive population.

The new China is symbolized by an electronics components factory in Shenzhen in the Pearl River (Zhu Jiang) Delta. When I visited it, the factory had 10,000 workers, each earning about $80 per month. All were young women. None wore eyeglasses. "Don't you have employees with bad eyesight?" I asked. The manager replied, "We fire them when their eyes go bad. They can find another job--that's not my problem." Indeed, those laid off generally do not return to peasant life, but become urban entrepreneurs in the service industries of China's new cities.

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