st be admitted that China’s transition to a high-tech, high-value-added economy will come as
a shock to many companies around the world. The US economy, which has about 7 percent of G
DP in high-tech manufacturing, will be lightly affected by this change.
On the other hand, advanced manufacturing contributes ar
ound 20 percent of GDP in South Korea, Japan, Germ
any and a few smaller European countries. They will be much more directly affected.
China’s transition over the next 10 years will not be pai
nless for its companies or for foreign competitors. But, refo
m and opening-up policies that create more competitive companies and markets are t
he only way to achieve a richer and more productive world economy in the long term.