Difference between revisions of "Strict internet censorship in China"

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==Description==
==Description==
China's traditional strengths as an investment or outsourcing destination have been its low labour costs and the government's willingness to facilitate foreign investment. However, as the economy grows, workers are demanding higher wage increases -- partly to compensate for rising inflation that is eroding their purchasing power. Additionally, the Chinese government's introduction of minimum wage legislation in January 2008 means that firms are now legally responsible for increasing wages, even if this is not enforced in practice.[1]<br>
Internet censorship in China is among the most stringent in the world. The government blocks Web sites that discuss the Dalai Lama, the 1989 crackdown on Tiananmen Square protesters and Falun Gong, the banned spiritual movement, among other Internet sites.<br>
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Before 2006, labour costs were rising at about 5% per year. However, between 2006 & 2007, costs rose nearly 16% in a couple of months -- a rate by which China's labour costs will soon reach parity with Malaysia and Thailand.[2]<br>
In June 2009, the government announced that starting July 1 mandatory new software would be installed on all new Chinese-made computers that would effectively monitor a user's every move.
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The Chinese National Bureau of Statistics revealed a rocketing increase in the Chinese people's annual average income from 615 yuan (US$74.37) in 1978 to 14,040 yuan (US$1,698) in 2003. This poises economic problems through increased production costs of manufacturers, increased market prices of commodities, and weakened export-oriented business.[3]<br>
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Employee turnover in some low-tech industries is approaching 50% -- although, thus far, improved productivity has offset higher wages. But economists say those productivity gains are getting harder to find, and manufacturers are beginning to see their margins get hit. That means managers can no longer simply provide eight-to-a-room dorms and expect laborers to toil 12 hours a day, seven days a week; a major change in paradigm for running a factory in China.  McKinsey & Company estimates that only about 10% of Chinese candidates for jobs in key areas such as finance, accounting, and engineering are qualified to work for a foreign company; while China today has fewer than 5,000 managers with the skills needed by multinationals, 75,000 jobs for such managers are expected to be created over the next five years.[4]<br>
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==Enablers==
==Enablers==

Revision as of 08:18, 18 September 2009

Description

Internet censorship in China is among the most stringent in the world. The government blocks Web sites that discuss the Dalai Lama, the 1989 crackdown on Tiananmen Square protesters and Falun Gong, the banned spiritual movement, among other Internet sites.

In June 2009, the government announced that starting July 1 mandatory new software would be installed on all new Chinese-made computers that would effectively monitor a user's every move.

Enablers

  • Fifty Cent Party
    • The party sets out to neutralize undesirable public opinion by pushing pro-Party views through chat rooms and Web forums, reporting dangerous content to authorities. By some estimates, these commentary teams now comprise as many as 280,000 members nationwide
  • International internet companies, such as Skype and Google, change their service to allow Chinese government to monitor users' behavior and opinion on the internet.

Inhibitors

  • Recession
  • Decrease in national GDP/ GDP growth rate

Paradigms

  • Decrease in attractiveness of China as a location for large-scale manufacturing investment
    • Shift to cheaper sites within Asia Pacific such as Thailand, the Philippines or India
  • Increasing importance of Total Cost of Ownership
    • More difficult for companies to successfully determine sourcing costs
  • The world's largest economy feeling the pains of inflation
  • Western countries such as the US will no longer be able to count on cheap Chinese imports to help control inflation


Web Resources

  1. "Internet Censorship in China", The New York Times
  2. "China’s Guerrilla War for the Web", Far Eastern Economic Review
  3. " Chinese censorship of internet 'unacceptable': EU", EUbisness

Revision History

September 2009 Created by Chia Wei Lee
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