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The Rise of the Far East

China has climbed from an isolated backward country into one with a growing influence capable of becoming a superpower rivaling the United States.

In recent years, China has bought, borrowed, or stolen technology, which has catapulted its military capabilities into the modern high-tech arena. No one can match China for sheer numbers of people, and now it can challenge most of the world in technological achievements. The Clinton administration blindly sold sensitive technology to China and reportedly received campaign financing in return.

The human rights abuses have received less attention lately as various foreign leaders flock to pay state visits to the country and give little or no condemnation of China's human rights record. It seems that it is more important to placate than to demand reform. In the meanwhile, forced abortions and sterilization continue to be state policy, and political and religious persecution continues unchecked.

The "red dragon" no longer sleeps. It is already anticipating a war with the United States in the next decade or so and may one day prove to be a mighty adversary for anyone who gets in the way.

Just as China has emerged as a mass manufacturer, India is emerging as a giant in services. Technical and managerial strengths in both China and India are becoming more important that cheap assembly labor. And, their relative strengths are complementary, not competitive. For example, China has excelled in mass manufacturing, with multi-billion-dollar electronics and heavy industrial plants; India has specialized in software, design, services, and precision industry. Their efficiency in back-office processing alone is legendary and outsourcing such work is expected to quadruple by 2010 to over $56 billion per year!

These two emerging giants will transform the entire global economy. China and India account for one-third of the worlds population. For the past two decades, China has been growing at 9.5% per year, and India at 6% per year.Both are projected to continue at an annual rate of 7-8% for at least the next ten years. By mid-century, China should overtake the U.S. as #1. Together, China and India could account for almost half of the total global output.

Indias younger workforce will give it a chance to catch up to China. Due to its one-child policy, Chinas working age population will peak at 1 billion in 2015 and then shrink steadily. India has nearly 500 million people (twice the population of the U.S.) under the age of 19 and higher fertility rates. By mid-century, India is expected to have 1.6 billion people, 220 million more workers than China.


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