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East Meets East:
A Great Divide on the brink of Healing


When it walks like a duck and quacks like a duck, chances are it's a duck. When a nation gives clear signals it hasn't let go of its imperious past, chances are that it won't. China has been vigorously attracting outsiders to help it build a modern industrial base. But reunification rumblings of the Koreas -- whose families and neighbors have viewed each other across a hostile no-man's land for more than a half-century -- could change that.

Beyond the 38th Parallel

It was assumed a divided Korea never could get together again. But hostilities can change quickly, as evident in Germany a decade ago when the walls suddenly and seemingly overnight came tumbling down.

There are compelling and mutually beneficial reasons for the reunification of the Koreas. North Korea is in a profoundly devastated economic state with its people starving and its industrial base virtually nonexistent.

Brother's Keeper

With South Korea appearing to offer a lifeline to its brothers in the north, it not only could recreate North Korea's industrial infrastructure and architecture as well as benefiting itself, but could set the stage for an unexpected about-face by China.

New manufacturing facilities in the North would use low cost Northern labor, significantly driving down the manufacturing costs of South Korean vehicle makers. That, for example, could make a $10,000 Leganza for the U.S. a distinct possibility.

Caution Sign

While that undoubtedly would please American consumers and joint venture shareholders in the West, there's a more ominous and mostly ignored threat.

A reunification of the Koreas provides an ideal conduit through which readily available high-end Western technology could flow into China next door, all but eliminating the need for a Western industrial and business presence there.

Moving Towards Dominance

For thousands of years, the Chinese, in addition to their own innovation prowess, have absorbed and assimilated, borg-like, all available processes, methodologies and technologies. A reunified Korea could help China become the dominant industrial power of the Asia Pacific.

Why would that concern the West? The answer should be obvious and pose the question: Is another nationalization of existing Western facilities in China the next step?

History keeps repeating itself in China, as in 1949 when former leader Generalissimo Chang Kai Shek was banished to Taiwan. Soft drink giant Pepsi Cola was nationalized in that Communist takeover and was banned from the country for a quarter century. Ford and General Motors, with long business pasts in China, had their investments there expropriated at the same time the West was rebuilding Europe after World War II.

Then there was Boeing, founded in 1916 with the aid of Chinese-born, American-educated Wang Tsu, the company's first chief engineer. Renewed company ties with China followed the 1972 reopening of that country. But Boeing wasn't spared six years ago from the wrath of the world's most populous nation when the U.S. interceded on behalf of Taiwan. China abruptly turned to AIRBUS in Europe to slap the hand of the West for intervening in a dispute it felt was no one else's business.

Going West

Recently, it has almost seemed China was trying to become Westernized. Daily flights to Beijing (originating from the U.S.'s automotive headquarters in Detroit) are commonplace as are the droves of Western executives traveling there to live where they work.

IBM will send volumes of technology to help small, emerging Chinese firms grow, according to Wu Baochun, manager, of the e-business department of IBM Corp., China, as reported earlier by Agence France Presse. And according to news reports, China has been wooing 11 foreign law firms and two from Hong Kong to set up mainland bases - an agreement based on China achieving its long-sought status as a member of the World Trade Organization (WTO).

With the world's most cutting edge technology, and a motivated labor force ready for the rewards of a burgeoning economy, what is to prevent China from capitalizing on those strengths, its relationship with a united Korea and its massive size and sheer numbers of people?

A Matter of Honesty

China hasn't changed. The Chinese are not ambiguous. They will tell you forthrightly what they want, and they have announced to the world exactly what they intend to do. What outsiders need to do is listen with Eastern ears.

 

"Thus it is that in war the victorious strategist only seeks battle after the victory has been won, whereas he who is destined to defeat first fights and afterwards looks for victory." - Sun Tzu The Art of War

Linkology:

World Trade Organization official web site.
http://www.wto.org

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