World economy enters deep transformation period (2)

Unshakable status as "world's factory"

Reporter: Certain Chinese manufacturers have moved their production facilities abroad due to domestic economic restructuring. What do you think of this phenomenon?

Nigel Gault (chief U.S. economist at IHS Global Insight): China's rising labor costs in recent years are a potential problem for the country's economic development.

However, consumers also have more money to buy what they want, which is conducive to the country's shift from an export-driven economic growth model to a consumption-driven model. Chinese manufacturing jobs will transfer to some other countries where the labor is cheaper to a certain degree.

The U.S. manufacturing sector will recover at a faster pace, and certain manufacturing companies have returned from China due to higher productivity in the United States. However, this does not mean a large number of new jobs for Americans because most of the U.S. manufacturing companies that have returned are engaged in capital-intensive industries.

Xie Dongming (economic analyst at OCBC Bank in Singapore): China can totally move up the global value chain in the future. Although the country's labor costs are rising steadily, it is generally believed that its status as the "world's factory" will remain unshakable in the short term. Labor costs are just part of manufacturing costs, and productivity, infrastructure, the supply of raw materials, quality of management personnel, and soundness of the legal system can all influence the manufacturing sector. There are few, if any, countries in Southeast Asia or other parts of the world that meet all the above conditions and can replace China as the "world's factory."

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