Chinesese manufacturers have come to dominate world markets with their brand of low-cost, low-price production. But with inflation soaring to a two-year high and businesses passing on the costs to consumers, is the “workshop of the world” losing its competitive edge?
This week’s beyondbrics chart breaks down China’s Purchasing Managers Index into its individual components and shows how these have changed between December 2008 and 2010. The chart makes grim reading for Chinese manufacturers: while costs continue to soar, translating into higher prices, export growth has begun to slow.
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