Why are Western Companies Investing in China? There are a few different reasons that the Western Companies are doing this. First, it is a market that is much more open to foreign investment than say Latin America or India. It would not be surprising if a Western company would start an Office in China and make lots of money from doing business there.
Second, they like the country for its great economic growth and it has shown that it can do so. China’s economy is growing at about 7% a year. That is faster than all the other major economies combined. So China has a very important edge over the U.S. and other major economies when it comes to being able to sell products on the world market.
Third, they see opportunity in the growing consumer market in China. China has been one of the fastest growing markets for all types of goods and services. That means that consumers around the world can find just about anything they want to buy at a lower price than back home. This has been a boon to companies like Wal-Mart and other brands that have been looking for new markets to sell their products in.
Lastly, they are coming because China has an enormous internal market that can provide a huge advantage over any other market. The Chinese people are extremely competitive and they will eat up any opportunity to take what is available to them. No matter what Western Company thinks, the Chinese people are always going to be buying more. There is no escaping the fact that.
There are reasons that all companies should be investing in China right now. If you really think about this for a moment you will realize that it is so logical and makes so much sense. Just look at the simple economic principle that we were talking about earlier. How could a market have an economy where everyone gets what they want? That just does not make sense.
So yes, Western companies should be investing in China right now. If you disagree with that, then I would like to point something out to you. Would it not be better if all companies followed the strategy of driving up the price of something so they could make more money? That would be the exact same thing as what the Chinese are doing and it is working out very nicely for them.