Just got back from China where it is obvious that the economy there is white hot and that the 1.2 Chinese are living a better life: cars, not bikes, western clothes not revolutionary garb and a thirst for learning English and perhaps even going to the States.
There is a price that has been paid for this rapid growth: smog hides the sun, traffic congestion is maddening, huge cancer rates, and growing unrest over public corruption, faulty building codes and fear that the economy is headed for a huge bursting of the growth bubble.
But for all the concern we have in the United States about the Chinese owning the US debt, the massive trade deficits as container ships leave Hong Kong harbor headed for Wal-Mart, and the strength of the Chinese currency relative to the dollar, we just may be winning the war, the so-called soft power war where our brands dominate the thinking and lifestyle of China.
The Colonel, that is the Kentucky Fried Chicken Colonel, is everywhere in Beijing. It is safe to say that I saw the huge neon picture of the Colonel more than the revolutionary hero Mao Zedong. In Shanghai, the trade capital of China, government officials and the upper class ride around in Buicks; in fact there is a huge Buick assembly plant in Shanghai. Last time I looked it was nearly impossible to convince Americans to buy a Buick. And in Hong Kong, ads for Apple products are everywhere, especially for the IPad; in fact there was a riot in Beijing and Shanghai when the new Apple store could not meet the demand of customers for the new phone.
China is clearly on an economic roll, but beneath all the confidence about their yearly growth rates in the 8% range, there is an unease in the country over the future and a recognition that although the United States may have hit a rough patch the last few years it is certainly not down and out.
China is expected to surpass the United States as the world’s number one economic power by 2020 or 2025 but those dates have recently been pushed upward as signs point to a softening of the Chinese economy and a recognition that power is not only economic, but cultural as well. The Colonel, Buicks and the Apple are signs of our power and also our ability to innovate, compete and create products that are in high demand.
After leaving China I am more convinced then ever that we are still a formidable economic power and may very likely never give up the # 1 position.