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Andrew Leung International Consultants Limited

Andrew Leung International Consultants Limited. Global Dynamics of a Rising China. Walmart Symphony EDLP (‘China Price’)= global supply chain super efficiency $260 b, 108 hubs, > 3,000 stores, Swiss GDP from China p.a. RFID Just In Time manufacture and delivery (e.g. hurricane signals)

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Andrew Leung International Consultants Limited

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  1. Andrew Leung International Consultants Limited Global Dynamics of a Rising China

  2. Walmart Symphony EDLP (‘China Price’)= global supply chain super efficiency $260 b, 108 hubs, > 3,000 stores, Swiss GDP from China p.a. RFID Just In Time manufacture and delivery (e.g. hurricane signals) Without Intermission or Finale UPS synchronisation 2% of world GDP 240 aircraft, 11th largest fleet In-sourcing – 3rd party logistics e.g. internet retail + repair + delivery DIAD (Driver Delivery and Acquisition Device) E-Bay – ‘International community’ 105m registered users, 190 countries Turnover US35 b Rolls Royce Competency from cars (licensed to BMW) to gas turbines 75% components and > 60% R&D outsourced ‘A German company? A Singapore company?’ Boeing - outsourcing includes Russian MIG engineers HP – 142,000 employees in 178 countries Lenovo– Chairman/CEO/COO/CFO - My consultancy input ‘The World is Flat’ Thomas Friedman

  3. The World’s Back-Office v The World’s Factory 60% of offshore white-collar jobs 3.3 million US jobs outsourced by 2015; I/T component 23% by 2007; to surpass US in software and tech-service jobs by 2010 HSBC, Lloyds TSB, British Rail, Aviva (UK’s largest home & car insurer); BT; legal documentation, British Trade Union: ‘Only up to 5% service jobs are geography-tied’ Helps to reduce the West’s pension burden? Bangalore > Silicon Valley in high-tech employment 85% of India covered by broadband Intel/Cisco/IBM/TI R&D centres >1,000 patents CMM Level 5 certification > US Indian computing companies training > 20,000 students in China Vinod Dham, ‘Father of Pentium’, Vinod Khosla co-founding first CEO Sun Microsystems;Amar Bose, founding CEO of Bose Group; Indian engineers 20% US Microsoft & 25% Ciso staff IIT rivals Harvard/Princeton/ MIT; > 800,000 I/T professionals; 2 million university graduates p.a.; 54% population under 25 (555m) 250,000 ‘accent-neutralised’ call centre staff e.g. AOL 400,000 US tax returns Remote PA/EA BPO (e.g. GE’s US 35 b global invoices) Wireless, end-to-end business solutions, composite materials, MRI scans, genetic engineering, econometric modelling, book publishing, Wall Street research, computer-aided designs for cars, aircraft, IC, supercomputers, fast-breeder nuclear reactors, state-of-the art remote-sensing satellites, fifth-generation combat jets and stealth warships etc Top medical care at low cost :heart surgery @US$8,000 inc airfare and a month’s hospitalisation (Blue Cross/Bleu Shield/BUPA ?) Bioinformatics (image analysis; data mining; workflow) e.g. GSK + Ranbaxy (early clinical trials) National Telemedicine Network accessible by 600,000 villages World champions: Mittal, world’s single largest steel group Tata (developing people’s car @US2,200) Largest exporter of generic drugs (60 FDA certified manufacturers NIIT expanding IT training in China to 500 centres by 2007 Newgen sells more advanced colour-compression technology to Canon Nokia mobile brain-chips But High-Tech sector + Manufacturing = 2% of employment Rising Elephant Ashutosh Sheshabalaya

  4. Individuals empowered Value Migration New value creation Originality & creativity Ideas & Insight Cutting-edge knowledge Competing with the World Race to the Top No job is indispensable/immutable Attitude, Aspiration, Ambition + Hard work New business paradigms

  5. US consumes 25% v China 8% of World’s oil China accounts for 1/3 of World demand growth but consumes @ 1/25 of US Both sit on < 3% of world’s oil reserve World proved oil reserve largely in Middle East: Saudi Arabia (22.1%), Iran (11.1%); Iraq (9.7%); Kuwait (8.3%); UAE (8.2%); Venezuela (6.5%); Russia (6.1%); Others (28%) China imports 40% of its oil but relies on highly polluting domestic coal for 77% of its power Vehicles consume 1/3 of China’s oil, rising to 65% by 2015 China’s uses 4.3 x US and 11.5 x Japan per unit GDP China to up nuclear power dependence from 2.3% to 4% by 2020 (30 x plants) China is World’s 3rd largest bio-fuel producer: Heilongjiang, Jilin, Liaoning, Anhui, & Henan produce 1 b g ethanol p.a. Mandatory use of mixed fuel in some farming provinces But renewables (inc hydro, wind, solar, biomass, subterranean, ocean etc) account for only 3% power consumption China’s external oil acquisitions causing increasing tensions with competitors especially US (over ‘rogue’ countries) and Japan (East China Sea) China, US, EU, Canada, Japan, and Russia on ITER (International Thermonuclear Energy Reactor) project on hydrogen fusion Shanghai to build World’s first eco-city in Dongtan in 2010. Energy

  6. Within China : 2005 NPC: Rural v Urban; Human v Environmental; Economic v Social; National v Local; Inward v Outward Investment Coastal v Inland Export v Consumption Rich v Poor Growth v People In the World : Western consumption v Eastern saving Globalisation v jobs Tradition (Entrenched culture) v Modernity Interdependence v Conflict (China/US; China/Japan; Mainland China/Taiwan) Oil power v Geopolitical stability Nationalism v International harmony Growth v Environment Energy v Sustainability Fundamentalism v Tolerance Cultural Diversity v Alienation Prosperity v Poverty (1990- 2015: Asia -500M, Africa + 120M) Development Imbalances

  7. Coordinated Balanced Development GDP to grow at 7.5% p.a. Population to stabilize at 1.36b Urban social security insurance to reach 223m people Rural medical care coverage to reach 80% Resource efficient and environment-friendly society Energy consumption per GDP unit to decrease by 20% Water consumption per GDP unit to decrease by 30% Main pollutant discharges to reduce by 10% New Socialist Countryside Productivity; Well-being; Civilised culture; Cleanliness; Democratic Governance Arable land to be maintained at 120m hectares Forest coverage to reach 20% Restructuring Growth – Service sector including consumption Building a Nation of Innovation – R & D expenditure to reach 2% GDP Scientific Development; Productivity/Efficiency > Scale; Sustainability; Harmony; People and Civil Society Deepening Market Economy Reform and Opening-up 11th Five-year Plan 2006 -2010

  8. Technology & Trade Harmony between growth v environment; people in society; between countries; modernisation v heritage Democracy with Chinese characteristics National Branding Rule of Law; Transparency; Accountability; Civil Society History & Confucianism International Partnership: USA & EU Japan, Russia & India Asia : ASEAN plus, Asian Currency, Asian Community Less Developed Countries especially Middle East, Near East, Latin America & Africa ‘Responsible stake-holder’ in global affairs: Global Security Climate Change (e.g. Alternative Energy, ITER) Poverty Relief China’s paths in the 21st Century

  9. Thank you www.andrewleunginternationalconsultants.com

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