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Manufacturers Attracted to China With Low Wages, WTO Admission

By Clay Chandler

The Washington Post -- DALIAN, China

In an eight-hour workday, Mabuchi’s production-line workers, nearly all of whom are women in their early 20s, repeat the same motions thousands of times. It is daunting labor that requires clear eyesight, nimble fingers and the ability to concentrate for hours on end. But Mabuchi, like tens of thousands of other foreign manufacturing concerns, has discovered in China a nearly inexhaustible supply of workers capable of handling such assignments -- and willing to take them on for a fraction of the pay demanded by counterparts in more advanced economies.

The women on Mabuchi’s assembly line in Dalian are the vanguard of what many experts predict will prove to be one of the most important economic developments of the 21st century: the rise of China as a modern industrial powerhouse.

China’s emergence as a manufacturing giant is improving living standards here and helping multinationals hold down costs. It’s also roiling the global economy, sucking jobs and investment from other countries, straining political support for open trade and driving down the price of tradable goods in the midst of a global recession.

China’s admission to the World Trade Organization earlier this month will only add to this trend, increasing its appeal by locking in lower duties for products it exports. Companies from Taiwan, Japan, the United States and other countries are seeking to satisfy the demands of their customers for lower prices, and China, with its enormous pool of cheap labor, is fast becoming a factory to the world.

Yiping Huang, an economist at Salomon Smith Barney in Hong Kong, cautions that China’s labor pool is not bottomless. The government’s one-child quota is bound to sap the country of young workers, he said. But executives at foreign manufacturing plants are not concerned.

“This is a big country, with a lot of people who want to work,” said one. “I don’t see that changing anytime soon.”