Business, Finance & Economics

China's need for growth

This man shuffles down a street of shops in Dongguan, and it's not what you'd expect to see here in a more prosperous area of China. But he looks like a hobo and he carries his belongings in a small, plastic bag. He says he hasn't eaten in two days and is looking for work. He's lost his ID card and says no one will give him work now. This man listens to that tale and he has his own tale about losing work. He says most plants around here have gone out of business or laid off workers because they're getting so fewer orders these days. There are signs of hard times all around these streets, and more shops are closed than open. Dongguan's woes are not just the result of the current economic crisis. Factories here have been struggling for years because of rising costs, tightened regulation and a strengthening currency which makes exports more expensive. China's economy grew by 9% last quarter and exports were up by even more, but much of China's factory belt was built on the promises of even more growth. An economic stimulus package might help, but probably not immediately. That's a frightening prospect for this factory manager, who says business is off. He says there's been no spike in orders in the ramp up before Christmas, which is a rarity. He says only the strong businesses might survive, which might be good for China's economy in the long run but it's bitter for now.

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