China Is A Developing Country

968 WordsDec 8, 20164 Pages
Because China is a developing country when it comes to logistics, it opens up a lot of revenue and business to foreigners and is rapidly expanding its economic health because of trade. The Chinese government is investing strongly into logistics and is also urging investors to do the same to allow for more economic growth. China also has an issue with a corrupt government which could potentially deter potential investors from the country, however, besides the drawback mentioned above, there are many benefits to companies creating production facilities in China rather than export products from US to China. One of the biggest benefits to the US is the location. It will be cheaper for a US company to create a production facility in China than to export because of the distance in travel. Since China is a part of the WTO there are easier entries to barriers to US firms seeking to open production facilities in China. Through the creation of the special economic zones, in which there are no tariffs, substantial tax incentives and low prices for land and labor, government has attracted many foreign investors bringing in billions of dollars in new equipment, technology, and managerial know-how and have increased local economic prosperity. Since China has a big imbalance in trade deficit, meaning it exports more than it imports, many European and US companies are looking to set up production facilities in China for exporting and this may help with China’s imbalance. China also
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