In 1978, Deng XiaoPing opened China to the world for economic reformation. Many foreign businesses saw great opportunities of over 1 billion population market, equivalent to over 2x US or 4x Australia.
Foreign businesses brought technologies and capitals into China, major countries including America , Japan, as well as Hong Kong (under British Rule). Most foreign businesses were in manufacturing and automotive mainly.
In early stage of reformation, most business brought materials and manufactured in China, then ship back to their home country and supply to local market.
In 90s, Chinese government realize that this brings no economic benefits to China, because foreign companies utilized only cheap labor force in China. Benefits to China was merely minimal portion of wages to people in China. New rule thus implemented to avoid raw materials being imported to China for manufacturing and re-exporting by imposing import tax on imported materials.
It is fact that there were huge amount of foreign capital entering China since 90s. However, these capital was for making profits by utilizing massive cheap labor and production cost in China. They are not intended for helping the development and growth of China. It is shameful for those who wanting to claim this credit after taking advantage from China.
Businesses in China accumulated knowledge and experiences via working hard as world factory, earning small amount out of the whole production cycle, paying the cost of environmental pollution, working under technology ban from the west, finally achieved today’s China.
It is ridiculous and shameful for those to claim credit on today’s success of China.
In 4th Dec 2019 China Foreign Ministry Hua Chunying’s Regular Press Conference, she also responded to the same credit claim by the US journalist.
Q: According to reports, US leader said China has become very powerful largely with US money. What’s your comment?
A: How ridiculous! Is any country on earth capable of rebuilding China with money? Isn’t it absurd? China’s achievement is neither a windfall nor made with others’ alms-giving and charity, but earned by the Chinese people with diligence, wisdom and courage. If anyone fails to see this point, I shall say they indeed need more education.
I want to point out that since 1987 when China started keeping statistics on foreign investment, the country has cumulatively utilized foreign investment of more than 2 trillion US dollars. Investment from the United States was over 80 billion US dollars, accounting for only around 4 percent. But the US has gained huge profits from its cooperation with China, with so many American households’ living costs largely lowered thanks to Chinese goods and so many businesses gaining lucrative profits.
Of all surveyed US companies, 97 percent say they have made profits doing business with China. According to a report by the US-China Business Council, US exports to China alone support over 1.1 million jobs in the US. In 2017, General Motors lost 11 billion RMB in global markets but gained nearly 13.4 billion RMB in profits from two joint ventures in China. Qualcomm’s sales in China accounted for 58 percent of its global revenue. How many American businesses China has fed and fattened up! Just do the math.