A survey from 2007 to 2009 in 135 countries by Gallups revealed that 16% of the worlds adult population would like to leave their home country for a country of their choice. This 16% converts to 700 million people and that is more than adult population of entire North & South America!

The most desired country was found to be US, Canada, UK, Germany, Saudi Arabia and Australia. Out of these 700 million majority would like to migrate to North america. Among the countries from where people would like to migrate, Africa tops the list along with other developing countries.

Why is this disparity between countries? Why does the grass on the other side seem to be greener always?

In this context we could say that the people from emerging nations aspire to live one day in a country as developed as US or UK. The IT/ITES revolution of this century have increased the awareness about what a developed country is all about. The standard of living, the ease of transportation and the predictability play major roles in setting a benchmark for choice of a country. People believe that sometime in future their country will emerge as a country of their dream. However, the waiting time for such transformation is huge in most of the cases. This urge of shortening the waiting time can be one of the reason for these 700 million to dream of switching the country.

Rogues

Shall we or shall we not?

A single bottled water in a developed nation like the US may cost as high as $100! People in developing nations do not prefer to pay such huge sums for a bottle of pristine water. Why?

People in Developed nations like U.S. and U.K. have a different set of lifestyles and values. There they perceive

pure water as a very precious product because they have seen a phase where almost all of the available water was promoted, through word of mouth publicity, as not pure. However, in todays context branded water industry is still riding on this wave. The consumers of branded water have adjusted to the fact that bottled water is the only safe water, neglecting the fact that the municipal water available in U.S. is of higher specifications than specified by the law. The standards are so high that this public water is one of the purest among all the nations. And still people buy bottled water.

What are the various factors for such behaviour?

1. Lifestyle: people are proud of buying a premium bottled water

2. Peer Influence: Everybody buys it, so I should follow

3. Convenience: It is available in a portable pack (everywhere)

4. Safety: Because it is the safest water

5. Affordability: I can afford it!

6. Taste: It tastes different

What reason do you have for drinking bottled water?

A recent study has shown that transportation of the bottles account for more than 50% of the cost of each bottle and another 25% for the packaging and promotions. The actual processing costs are negligible. So, you are responsible for paying for the pollution caused by the transportation of millions

of liters of so called safe drinking water.

Rogues

what is manufacturing?

It is value addition to the various raw materials like ores, chemicals, wood etc. Mechanical and chemical operaions like segregation, reaction and size reduction are some of the important operaitions which add value to raw materials. This large scale value addition to the raw materials is termed as manufacturing.

why china is the leader in manufacturing?

Raw material+Utilities+Manpower+Technology = Finished Product

China has the largest and the cheapest manpower in the world. The cost of utilities are still the cheapest in this country. Another factor is automation, which leads to low manufacturing costs.Though this has not reached the levels of a developed country, the cheap manpower and other abundant natural resouces of China makes the overall manufacturing cheaper. China may not be the leader in technologies but world’s technology leaders like Intel outsource most of their manufacturing to this country. Taiwan Semiconductors of Taiwan, worlds largest independent semiconductor manufacturer, gets most of the production done in China. To remain competitive, the best and the largest companies of the world have knocked the doors of China for manufacturing. 50% of world cameras, 30% airconditioners and 25% of the washing machines are made in China. 70% of the metallic lighters sold in the world are made in the city of Wenzhou, China. No wonder China is the manufacturing hub of the world.

So What?

Most of the developed countries like US and UK are facing increased trade deficits of more than 5% after decades, thanks to the sustainable competitive advantage of Chinese manufacturing companies. Most of the companies have made it the rule of the thumb that manufacturing can be cheap only in china. This change in the strategies of outsourcing have increased the bargaining power of China as a whole. Now China has earned the power to negotiate with the most powerful economies of the world, not with weapons but with supply of goods. China has gained what weapons of US could not!

Rogues

This project will cost China $64 billion! much more than the controversial Three Gorges Dams project. However this project will diverge 44.8 billion m3 annually to the northern part of the country. This figure is equivalent to the annual water flow of the Yello river. The project will involve construction of thousands of kilometers of canals including many tunnels and under river passages. The project is expected to be completed by 2050.

History says that such mega moves are important for long term competitive advantage over other countires. Great ports and airports gave advantages to many developed countries like US, UK and Japan. Infrastrucre projects are the most controversial and the most difficult to implement in this environment conscious world. And China has the capabilty and determination to work against the odds. Time will tell how correct these decisions are and how beneficial such projects are for the worlds largest population.

Rogues.