Back in China for a Business Trip

Its good to get back to China. I'm finally back here for a bit on a business trip. It has been almost 3 years since my wife and I wrapped up our assignment in Shenzhen, China. Time Flies! It is great to be back to visit old friends and see how much has changed since my wife and I lived here.

The rate and pace of change in Shenzhen never ceases to amaze me. It hard to recognize many areas of Shenzhen, but friendly consistencies include construction cranes as far as the eye can see and the amount of young people here seeking a better life. There are many friendly reminders of how the booming economy here continues. I definitely miss this place as I often feel more “alive” here than back in the US – everyday is an adventure in China.

Economic Boom in China
I believe that the current economic boom in China is unsustainable in the long term. Like in the US during the Industrial Revolution I believe all good things come to an end. A specific example is the cost of housing in Shenzhen. Based on the informal data I get from my coworkers the cost of purchasing an apartment in Shenzhen appears unsustainably high. Well over 10x-20x an average professional salary here of $15-30k USD, I think the cost of living at least in this part of China is unsustainable unless there is very high inflation. With the high cost of living comes the heavy push to increase wages. With the higher salaries demanded in China, I believe reduces the demand on outsourcing to China. Its not too far off a tipping point where the appeal of outsourcing to China no longer makes a lot of sense. We aren’t there yet, but if inflation continues in China at 5-10% annually then in my mind we are only 2-3 years or less from the tipping point. The risk may no longer be worth the reward going forward with outsourcing. That is my 2 cents at least.

However the economic boom here still appears to be going strong - so I guess we enjoy it. I don't think its good to invest in China at this point, but rather after or during a significant economic correction.

Related in Temporary Assignment:

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Packing Tips for Extended Family Travel (Oct 14, 2013) My young family is on the move - we are currently living in China on a 6 month work assignment. With the exorbitant cost to ship additional stuff to China we were incented to only bring what we could fit...

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Comments (1)


I agree that the rapid growth just isn't going to hang on. More importantly, look down the road twenty, thirty, or even fifty years from now. Just like in the USA now, all of that infrastructure will be old. All of these shiny new buildings will no longer be shiny and new. It'll be interesting to see if any lessons have really been learned and where we go from here.

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