The document discusses the rising industrial growth in China and reasons for its development as a new economic giant. It explains that since 1979, the Chinese government has allowed foreign investment and established special economic zones to attract manufacturing. Transnational corporations are drawn to China due to its huge pool of cheap labor, potential large market, and tax incentives. While offering opportunities, expanding industrialization has also created environmental and social challenges for China.

1. The relative importance of manufacturing to different countries is changing Textbook page 279- 283

2. Objectives: To recognise and explain the rising industrial growth in some parts of the world and de-industrialisation in other parts. To understand the effects of government legislation, long working hours, health and safety regulations, prohibition of strikes and tax incentives and tax free zones. To explain the development of China as the new economic giant.

3. Graph AQA 279

4. U.K. 1750 industrial Revolution Early 20 th C over half of the UK workforce was in manufacturing Traditional heavy industries: steel, shipbuilding, metal smelting and engineering, cotton and woollen textiles Location – coalfield regions of Clydeside, NE, S.Wales, Lancashire, Yorkshire and W. Midlands

7. De- industrialisation A decline in the relative importance of manufacturing industry which results in sharp fall in total workforce Decline began after 1951 and speeded up during 1980s]British steelworks, shipyards and textile mills could not compete on costs and delivery times with NICs Deindustrialisation occurred due to: Increased mechanisation Efficiency in order to be competitive

8. Effects of de-industrialisation Closure of coalmines coincided with the decline in heavy industries Massive job losses Few alternative employment opportunities Severe socio-economic problems High rates of unemployment, poverty and deprivation Abandoned houses factories, mines and railway sidings added to areas already suffering from environmental problems such as polluted rivers and canals, waste tips and derelict land from years of heavy industry and mining

9. AQA 2007 Q4 4 (b) Describe the effect of government policy on the location of industry in the UK or another MEDC that you have studied. (4 marks) 4 (c) Apart from cheaper labour, explain why industry is developing rapidly in Newly Industrialising Countries (NICs). (4 marks)

10. 4 (b) Level 1 (Basic) 1-2 marks 4 marks Simple list of government policies without any attempt to show how they have affected the location of industry. Assisted area status / retraining grants / enterprise zones / interest free loans / improving the infrastructure / moving government agencies to areas of high unemployment. Level 2 (Clear) 3-4 marks Linked statements showing how government policies can influence the location of industry. South Wales was an area of high unemployment after the closure of the coalmines and the steel works. The area was given assisted area status, e.g. an enterprise zone was set up. e.g. MVLA to South Wales DHSS to North East England. 4 (c) Level 1 (Basic) 1-2 marks 4 marks Simple lists of methods used to attract industry to NICs without any development. No marks for cheap labour. Tax incentives / subsidised loans / long working hours/ free trade zones / strikes illegal / TNCs. Level 2 (Clear) 3-4 marks Linked statements showing how methods used can encourage industries in NICs. Accept reference to the Olympic factor in China. Tax incentives and subsidised loans making it easier and cheaper for foreign companies to set up in the country / helps pay for set up costs. There are long working hours, which reduce the cost of production / Free Trade zones for foreign companies so businesses are not subject to taxes / they can produce their goods more cheaply and so they are encouraged more to the NIC. Strike actions made illegal so there is continuous production / do not lose money due to stoppages.

11. Reasons for rising industrial growth in NICs Some developing countries experienced rapid industrial growth in the 1970s and 1980s NICs – E Asia, Mexico, Brazil Trigger came from TNCs deciding to transfer some of their operations overseas

12. Push – pull factors for transfers of manufacturing industry Diag pg 219 Pull factors Lower labour costs Weak or absent trade unions Long working hours Weakly enforced health and safety regulations (sweat shops) Lower standards of working conditions Tax-free zones Lower tax rates

13. East Asian tigers Hong Kong, Singapore, Taiwan, South Korea Thailand, Malaysia, Indonesia, Philippines China, India Heavy industry steel, ships, engineering, petrochemicals Light consumer industries clothes, trainers, toys, home, electrical goods, bikes and cars High-tech industries micro chips, semi conductors, telecommunications, digital equipment

14. What is being suggested by this cartoon? Why a tiger? What does the movement of the tiger suggest? Which country’s flag is depicted? Who is the man? Why is he seated on the tiger?

15. Advantages of E. Asia for industrial growth Labour Cheap labour reliable workers Willing to work hard for long hours Lower health and safety regulations, working conditions 2. Transport All countries in the region have access to the main shipping lanes. Use of containers has reduced cost of transporting manufactured goods by sea as well as making it easier and more secure Transport by sea is the cheapest way to transport goods over long distances

17. 3. Government backing Governments have encouraged the import of overseas companies capital and technology to establish factories and provide employment. They have provided the political stability necessary for successful industry and trade 4. Markets Home markets are expanding as people become more prosperous Asia is the most populous continent and the future potential of Asian markets is enormous as economies grow and personal wealth increases

18. Effects of government legislation Areas experiencing growth in manufacturing: Setting up areas (assisted areas / enterprise zones where conditions are favourable for new industry Providing advance factories of various sizes Offering retraining and removal expenses Some countries have a minimum wage Directives which limit the maximum number of hours worked per week

19. Health and safety regulations Working conditions vary globally. UK – adult employees working >6hrs are entitled to a 20min break Have the right to know how to do their job safely and to be trained to do so Know how to get first aid Know what to do in an emergency Be supplied with protective clothing

20. strikes Such disruption has an adverse effect on manufacturing industry Some companies came to the UK on the understanding that strike action would not be allowed

21. Tax incentives and tax free zones Tax incentives seek to offset costs Job creation grants Business rate or rent free periods

22. China – new industrial giant World’s third largest manufacturing country in 2005 (after US and Japan) Produced 7% world manufacturing output in 2005 Dominates world production of ready to wear clothes footwear and toys 2003 steel production was thought to be 25% world output Makes 60% worlds bicycles Has over 25% of world production of TV sets and washing machines Makes 50% of all the world’s cameras, mobile phones and photocopiers

24. Reasons for China’s rapid growth Government legislation: Since 1979, after years of blocking trade with western countries, the government allowed investment from overseas. Why? – the Government accept that they were never going to modernise the country’s factories without the new machines, modern technology, technical skills and efficient working practices that foreign TNCs could provide Government maintained overall control, and controls banks, large heavy industry and public services. It is the production of consumer goods, many of them for export that is in the hands of TNCs and their Chinese partners.

25. Shanghai: Creating a global city

26. What does China offer TNCs? Huge pool of cheap labour that undercuts other Asian countries on costs. 95% lower wages than US. Minimum wage is about £90 per month compared to UK of £990 Chinese workers belong to the All-China Federation of Trade Unions which is required by law to get people back to work as quickly as possible so productivity is maximised. It is illegal to belong to any other trade union Chinese law says that people are only allowed to work 40 hours per week with a maximum of 36 hours of overtime per month – this isn’t always enforced. Lower health and safety regulations – they are in place but just aren't heavily enforced Potential size of home market for consumer goods as population become better off. One child policy means people have more disposable income rather than spending on raising family and demand electrical household goods, cars, computers. Special economic zones set up between 1980 and 1994 that offer tax incentives to foreign businesses. Foreign manufacturers pay no tax for years 1 & 2 50% for years 3 – 5 15% from then on Shenzhen is one of most successful SEZs - £30 billion of investment – factories make product for Wal-Mart, Dell and IBM Shanghai is a major port and business centre. Hong Kong remains China’s outlet to the world.

27. China’s future Olympic factor 2008 Beijing provided China with the perfect opportunity to showcase the nation Theme ‘ One world, One dream’ conveyed China as an open friendly country and an important integrated positive part of the world in the 21 st century Three Gorges Dam Industrial development on a large scale demands large resources of energy China currently generates 2/3 of its electricity at coal fired power stations. New plants are being built HEP – china produces more HEP than any other country and is keen to develop new sources of energy. The Three Gorges Dam is the biggest in the world and together with the development of navigation along the Yangtze the dam has led to much development

29. Class task Textbook page 282 / 3 Answer q’s 1 and 2

30. Homework Why do TNCs want to move into China? What difficulties (such as cultural differences) do you think they may face Find examples of TNCs that are opening factories, businesses, stores in China