CHINA: PHARMACEUTICAL PRODUCTION AND CONSUMPTION IDEOLOGIES JUAN SEBASTIAN BETANCUR MONSALVE ANDRÉS FELIPE RAMÍREZ GARCIA CATALINA CASTRILLÓN VALDERRAMA UNIVERSIDAD CATOLICA POPULAR DEL RISARALDAFACULTAD DE CIENCIAS ECONOMICAS Y ADMINISTRATIVAS NEGOCIOS INTERNACIONALES PEREIRA 2010
CHINAThe wave of free movement of goods, capital and production factors amongcountries has greatly impacted the world. The apparent distances have beenshortened, the acquisition of more and new goods and services is becomingincreasingly clear, the production companies are done in less time and otheramazing processes occur are the result of a world that does not stop, a world thatnever sleeps, a world that is globalized.China has not been indifferent to the global effects because it has become acountry with an open and attractive economic in the international market, and it hasalso demonstrated the great advantages that other countries can get in order toinvest in the country. Moreover, globalization has not only economic developmentbut also social and because it has improved the stability and quality of life ofChinese society.Then, taking into account the above to place greater emphasis on the study of thisfuture world power is very important to review general aspects of the said country,starting with the description of geographic, demographic and economicdevelopment.China has been characterized as one of the oldest civilizations in the world, alsofor being the largest country in East Asia and the worlds most populous.China has a land area about 9,571,300 km ², it is located in east Asia, and itsneighboring areas are: Mongolia and Russia to the north, Russia and North Korea,to the northeastern, the Yellow Sea and the Sea East China to the east, the SouthChina Sea, Vietnam, Laos, Myanmar (Burma), India, Bhutan and Nepal to the
south, Pakistan, and Tajikistan to the west, and Kyrgyzstan and Kazakhstan to thenorthwest. Also, it is necessary to mention that China has more than 2,900offshore islands in the South China Sea, and Hainan is the biggest one. (Retrievedon September 28 of 2010 from the webpagehttps://www.cia.gov/library/publications/the-world-factbook/geos/ch.html)The country is divided into 23 provinces, 5 autonomous regions, 4 municipalitiesdirectly under the Central and 2 special administrative regions. (Retrieved onSeptember 28 of 2010 from the webpage http://search.china.org.cn) Following that,China’s capital Beijing is ranked as the center of the political, cultural andintellectual development of China, as well, it is known as the main industrial andcommercial metropolis, another important city is Shanghai because it is the largestcity, and other major cities include Hangzhou Xian Kunming and Chengdu.Furthermore, China has a variety of temperature and rainfall zones, includingcontinental monsoon areas. In winter most areas become cold and dry, in summerhot and rainy. In this country mild weather prevails, there are also semi-desertregions in the western interior and a small area of the southeastern tropicalclimate.CULTUREChinese culture is so diverse and unique, yet harmoniously blended, and presentsitself an invaluable asset to the world. So, it is important to mention somecharacteristic of the Chinese culture, such as the aesthetics, values and attitudesmodals and customs, language, Chinese characters, ethnic groups, and thereligionAestheticsThe Good taste is considered important by a culture: the numbers, music, colorand arts in China, it is therefore characterized in:Significant colors: Green, Red, Yellow, White, Purple, Greenish blue.Meaning of Numbers: Chinese people believe that the numbers have positive ornegative meanings that influence their daily lives. For example, they believe thatnumber four (4) is a negative number, and number two (2), six (6), eight (8) andnine (9) as lucky numbers.Chinas music is classified as:Traditional: this is used to express human feelings.
Contemporary: it is influenced by Western culture. In this are part of genres likepop, electronic, rock and heavy metal.Values and attitudes:In China values are ideas, beliefs and customs which the people are subjectemotionally. For example, the society always looks for a good respect, education,obedience, family loyalty, patience, kindness and generosity. Also, the attitudes forthe Chinese are feelings and tendencies evaluations whether positive or negativeindividuals have on objects and concepts. For instance, they do not express theirfeelings in public, and they never say "no" or "I do not know."Modals and customs:The Chinese people consider that it is necessary to have good modals when aperson is greeting another. For example, they use Slight nod, handshake and they said that it is impolite to kiss and hug.Chinese Festivals & Events: Chinese culture in a wide variety of festivities thathighlight the importance of traditions and customs of the country, besides, most ofthe celebrations have significant national recognition, and some of the mainfestivities and multiple-day holidays are as follows: Spring Festival, Lanternfestival, Dragon Boat Festival, Mid-Autumn Festival, Chinese New Year, in Januaryor February; International Labor Day, which is the first week of May; and finally,National Day, which is celebrated during the first week of October.Languages:There is confusion about the categorization of linguistic groups as languages ordialects, but it is generally accepted that there are five main groups of dialects inthe Chinese language group. These are Mandarin, Wu, Min, Yue and Hakka.Mandarin is the official language for both mainland China (known as Pu-Tong-Hua)and for Taiwan (known as Guo Yu), despite major political differences between thetwo countries. It is also one of the four official languages of Singapore (known asYu Hua). The Wu is spoken along the lower Yangtze River and its tributaries. TheShanghainese is a well-known variety wu. And, the yue is mainly spoken in theprovince of Guangdong. (Retrieved on September 28 of 2010http://www.alsintl.com/spanish/chinese.htm)Chinese charactersThe Chinese characters have had many variants and styles throughout Chinesehistory. Tens of thousands of ancient written documents are still extant, from oraclebones to Qing edicts. This literary emphasis affected the general perception of
cultural refinement in China, e.g. the view that calligraphy was a higher art formthan painting or drama. Manuscripts of the Classics and religious texts (mainlyConfucian, Taoist, and Buddhist) were handwritten by ink brush.Ethnic groups:As a large united multi-national state, China is composed of 56 ethnic groups.Among them Han Chinese account for 91.59% of the overall Chinese populationand the other 55 make up the remaining 8.41% according to the Fifth NationalPopulation Census of 2000. As the combined population of these other ethnicgroups is far fewer than that of the Han, they form the 55 ethnic minorities ofChina.These numerous ethnic groups share Chinas vast lands but at the same timemany live in their individual communities. The relationships between the differentethnic groups have been formed over many years.The ethnic groups in China are classified in the following way: Han Chinese 91.5%,Zhuang, Manchu, Hui, Miao, Uighur, Tujia, Yi, Mongol, Tibetan, Buyi, Dong, Yao,Korean, and other nationalities 8.5% (2000 census). (Retrieved on September 28of 2010 http://www.travelchinaguide.com/intro/nationality/)Religion:Chinese religion is not an organized, unified system of beliefs and practices. Ithas no leadership, no headquarters, no founder, and no denominations. Instead,"Chinese religion" is a general term used to describe the complex interaction ofdifferent religious and philosophical traditions that have been especially influentialin China.Although other religious traditions have been influential in China, Chinese religionis primarily composed of four main traditions: Chinese folk religion, Confucianism,Taoism and Buddhism. The religious outlook of most Chinese people consists of
some combination of beliefs and practices from these four traditions. It is very rarefor only one to be practiced to the exclusion of the others.Buddhism, Taoism, and Confucianism, each of which is a significant part ofChinese religion, are treated in their own sections on Religion Facts. This sectionfocuses especially on Chinese folk or indigenous religion, but reference is alsomade to the other traditions. (Retrieved on September 28 of 2010http://www.religionfacts.com/chinese_religion/index.htm/)GOVERNMENTTable 1. Principal government facts PRINCIPAL GOVERNMENT AND PARTY OFFICIALS President Hu Jintao Vice President Xi Jinping Premier, State Wen Jiabao Council State Councilors Liu Yandong, Liang Guanglie, Ma Kai, Meng Jianzhu, Dai Bingguo Secretary General Hua Jianmin Ambassador to U.S. Zhou Wenzhong Ambassador to UN Wang Guangya Type: Communist party-led state. Constitution: December 4, 1982. Independence Unification under the Qin (Chin) Dynasty 221 BC; Qing (Ching or Manchu) Dynasty replaced by a republic on February 12, 1912; Peoples Republic established October 1, 1949. Branches Executive--president, vice president, State Council, premier. Legislative--unicameral National Peoples Congress. Judicial-- Supreme Peoples Court. Administrative 23 provinces (the P.R.C. considers Taiwan to be its 23rd province); 5 divisions autonomous regions, including Tibet; 4 municipalities directly under the State Council. Political parties Chinese Communist Party, 70.8 million members; 8 minor parties under Communist Party supervision. Legal system based on civil law system; derived from Soviet and continental civil code legal principles; legislature retains power to interpret statutes; constitution ambiguous on judicial review of legislation; has not accepted compulsory ICJ jurisdictionSource: http://www.traveldocs.com/cn/govern.htm
All power within the government of the Peoples Republic of China is dividedamong three bodies: the Communist Party of China, the state, and the PeoplesLiberation Army (PLA).The primary organs of state power are the National Peoples Congress (NPC), thePresident, and the State Council.At the same time there has been a move for having party and state offices to beseparated at levels other than the central government. It is unheard of for a sub-national executive to also be party secretary. This frequently causes conflictbetween the chief executive and the party secretary, and this conflict is widely seenas intentional to prevent either from becoming too powerful.The Chinese Government has always been subordinate to the Chinese CommunistParty (CCP); its role is to implement party policies. The primary organs of statepower are the National Peoples Congress (NPC), the President (the head ofstate), and the State Council. The members of the State Council include PremierWen Jiabao (the head of government), a variable number of vice premiers (nowfour), five state councilors (protocol equivalents of vice premiers but with narrowerportfolios), and 25 ministers, the central bank governor, and the auditor-general.Under the Chinese constitution, the NPC is the highest organ of state power inChina. It meets annually for about two weeks to review and approve major newpolicy directions, laws, the budget, and major personnel changes. These initiativesare presented to the NPC for consideration by the State Council after previousendorsement by the Communist Partys Central Committee. And, most nationallegislation in the PRC is adopted by the Standing Committee of the NationalPeoples Congress.ECONOMYTable 2. Principal economy facts GDP (2009) $4.814 trillion (exchange rate-based). Per capita GDP (2009) $3,678 (exchange rate-based). GDP real growth rate 8.7%. (2009) GDP composition by Agriculture: 10.6% sector Industry: 46.8% Services: 42.6% (2009 est.) INFLATION RATE -0.7% (2009 est.)
consumer prices Country comparison to the world: 14.6% (2008 est.) Natural resources Coal, iron ore, petroleum, natural gas, mercury, tin, tungsten, antimony, manganese, molybdenum, vanadium, magnetite, aluminum, lead, zinc, uranium, hydropower potential (worlds largest). Agriculture. Products--Among the worlds largest producers of rice, wheat, potatoes, corn, peanuts, tea, millet, barley; commercial crops include cotton, other fibers, apples, oilseeds, pork and fish; produces variety of livestock products. Industry Types--mining and ore processing, iron, steel, aluminum, and other metals, coal; machine building; armaments; textiles and apparel; petroleum; cement; chemicals; fertilizers; consumer products, including footwear, toys, and electronics; food processing; transportation equipment, including automobiles, rail cars and locomotives, ships, and aircraft; telecommunications equipment, commercial space launch vehicles, satellites. TRADE BALANCE Exports $1.204 trillion (2009 est.) country comparison to the world: 2 $1.435 trillion (2008 est.) Exports electrical and other machinery, including data processing (commodities) equipment, apparel, textiles, iron and steel, optical and medical equipment Exports (Partners) US 20.03%, Hong Kong 12.03%, Japan 8.32%, South Korea 4.55%, Germany 4.27% (2009) Imports $954.3 billion (2009 est.) country comparison to the world: 4 $1.074 trillion (2008 est.) Imports electrical and other machinery, oil and mineral fuels, optical and (commodities) medical equipment, metal ores, plastics, organic chemicals Imports (partners) Japan 12.27%, Hong Kong 10.06%, South Korea 9.04%, US 7.66%, Taiwan 6.84%, Germany 5.54% (2009)Source: http://www.state.gov/r/pa/ei/bgn/18902.htm
HOW TO DO BUSINESS IN CHINAIt is not surprising at all when many foreign investors complained when they dobusiness in China. Many wondered why their years of experience in the businessworld could not be applied in China immediately. Doing business is about buildingmutual trust and benefit amidst establishing relationship with people. If you do notunderstand your counterpart well, it will be quite difficult to establish goodcooperation with him/her.Understanding factors such as China’s history, humanity and culture will be the keyto investors’ success in China. As Western thinking and China’s traditional valuesdo differ, encountering the culture differences is therefore inevitable, thus a betterunderstanding of the cultural differences is necessary when doing business inChina:1. Learn how to handle Guangxi (relationship): A special feature of doingbusiness in China will be that Guangxi (relationship) in China will have to includerelationship with the government body, investors, partners and even relationshipwith your own staff.2. How to prevail over competition: China, at the moment, can be said to be abig, open market, and the ability to prevail over competition is a very importantissue today. Investors should fully realize and maximize ones advantages. Someinvestors are afraid that the China’s imitation products will hurt the sale of theirproducts. Even though this symptom is worrying, however in a free and competitivemarket, it will always be one that has the superior quality that will not be afraid ofcompetition and will prevail eventually. China market is constantly undergoingstandardization, and the China.3. Route for Investment: There are three options to take when make investmentsin China, mainly: wholly foreign-owned enterprise, Chinese-foreign cooperativeenterprise and Sino-foreign joint venture.(Retrieved on September 27 of 2010, http://www.china-window.com/china_business/doing_business_in_china/index.shtml)
CHINA: PHARMACEUTICAL PRODUCTION AND CONSUMPTION IDEOLOGIESChina prefers to produce and consume generic pharmaceuticals because there areeconomic and social conditions that promote the production and consumption ofthese pharmaceuticals. Some of these mayor conditions are:- In 2003 China produced about 62% of its production of pharmaceutical generics,by 2008 this production declined to 37%, however the production of generic drugscontinues to be an important part of the pharmaceutical sector.- China has become the second largest recipient of foreign direct investment in theworld and the fastest growing, part of this foreign direct investment has been aimedat the pharmaceutical industry because pharmaceutical production is cheaper dueto low-cost labor force, low-cost purchasing of raw materials and inputs, and aflexible non-restrictive policy on pharmaceutical production issues.- China has got a large population near to 1.200 million people, most of them low-income wagged, so there is a mayor need among the population to access to low-cost pharmaceuticals, which are most of the time generic pharmaceuticals.- The economic participation of the Chinese pharmaceutical industry in Asia,constituted only a small portion of the market, however with the emergence ofAH1N1 influenza disease, the Chinese pharmaceutical industry took a more activerole in the Asian pharmaceutical market, because this was in charge of promotingthe greater part of medicine production of generic pharmaceuticals to alleviate thisdisease among the population, in addition the Chinese pharmaceutical industryalso acquired significant economic importance it started the production anddevelopment of vaccine against HIV/AIDS on its first phase.- The Chinese central government, as well as the authorities of various provinceshas encouraged mergers of domestic companies in the sector, especially smallcompanies to provide them with better tools to develop opportunities within themarket.- Chinese researchers are ready to support any research and development project,they have skills and discipline to do so. Chinese suppliers can support industryefforts to seek cost reductions, it will be a matter of survival, and the Chinesepartners may accompany any expansion project in the pharmaceutical sector.The Chinese government have made great efforts in recent years to support andstrengthen its pharmaceutical industry, they have implemented strategies such asamalgamate small local pharmaceutical manufacturing companies to create newlarger industries, encouraged the creation of joint-venture of Small Chinese
pharmaceutical companies to large multinationals in the same industry and it hascreated more equality on its legal system toward foreign companies.China is nowadays the seventh largest pharmaceutical market in the world which isconstantly growing and expanding, so if China continues this trend with otheremerging countries, the Chinese pharmaceutical industry will be the largest marketin consumption and production generic pharmaceuticals by 2020 overtaking theUnited States.
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