China & Vietnam...Not Exactly BFF"s

China tried for centuries to colonize Vietnam; a country who certainly desired their independence. With strained ties, it has not exactly been kosher for the two countries to do business in a friendly traditional manner. Now, however, Le Duong Quang, Deputy Industry Minister of Vietnam, is attempting to lure Chinese investment so that the copious amounts of minerals which the highlands of Vietnam contains may be extracted. There is currently a $460 million deal on the table with a Chinese mining company however there has been much outcry from the Vietnamese as they are discontent with a foe working with their natural resources. The purpose of the deal would be to extract some of the 5.4 billion metric tons of bauxite (an ore used to created alluminum) which Vietnam maintains within their borders.

Environmentalists are particularly concerned with the deal as it could have a gravely detrimental impact upon the coffee business. The Highlands of Vietname produce 80% of the country's coffee and other raw materials rubber, pepper and cocoa. Vietnam, like many other Asian nations has tried to promote economic prosperity in the poverty ravished nations but has desemated their natural environment in the process.Carlyle Thayer, a professor and Vietnam expert at the Australian Defense Academy in Canberra has stated,

"There are a lot of people in Vietnam who have benefited from economic liberalization, and have televisions and microwaves and so on, but they are also living on crowded and polluted streets and quality of life is becoming a bigger issue. There is now a degree of technocratic expertise emerging to challenge the Communist Party."

It's clear that the Vietnamese are particularly upset with the trade deal because they still maintain anti-Chinese sentiment because the scarred history the countries share. American companies have invested in the mining industry of Vietnam and were met with little to no opposition. Unfortunately, the Vietnamese citzens need to understand that their nation's $11 billion trade deficit with China needs to be addressed. (Speaking from American firsthand experience...you don't want an insurmountable trade deficit with anyone). The Deputy Industry Minister of Vietnam appears to be making the right decision as he realizes that the country has a very valuable natural resource that could be utilized to spur the economy and lessen the deficit. It must, however, be made a priority to protect the environment in extracting these minerals or Vietnam will find itself traveling down the long and slippery slope China now faces. It is easy to boost the economy without regard to environmental protection; but this certainly comes at a devastating cost. China must now figure out how to improve their air quality, cleanliness of water, serious infrastructure instability in more rural areas, and the list goes on. China, in contrast, could be poised to make such changes as they have had economic development and prosperity for a much longer period of time. Vietnam must take extreme caution in foregoing environmental protection in favor of improving their economy.

Feel Better...Chinese College Grads Can't Get Jobs Either

While China faces the worst economic downturn in 20 years, college graduates are having a difficult time finding employment. As more and more graduates enter "the real world" they are finding more competition, "Up to one-third of last year's 5.6 million university graduates are still looking for work, and this year will see another 6.1 million hit the labor market." As China required their state-run universities to increase their enrollment rates they had planned on the increase in tuition to pay for the expansion of campuses across the country.

These plans had drastically overestimated the amount of new funding universities would receive. This is very similar to the credit bubble which occurred in the United States when lending companies severely overestimated the values of homes thus resulting in consumers receiving more money than they could afford to repay. Universities were essentially giving out degrees to very under qualified students who had not been given the resources or instruction necessary to earn a degree in their respective fields. In comparison, US lending institutions rarely executed the research necessary to ensure that their clients had the required job stability or income to reliably back up their loan.



The majority of the university debt problem stems from the 2,100 average universities which have also been state funded. They have been defaulting on their loans totaling $1.2 billion in debts. Local governments have had to require banks to restructure the terms of repayment for the universities to ensure that they do not collapse. The 75 elite universities throughout China (relatively comparable to Ivy League) have maintained adequate funding from the state to ensure sound operations.

As though the exponential increase in enrollment was not enough for China's universities to deal with; many corrupt university administrators used the state funding to improve and expand their educational efforts for economic gain. After an investigation of several universities it was found that funds were used to purchase a golf course and adorn the school with lavish statues.

This wide-spread problem exemplifies the problems that China faces on a regular basis with any governmental project. Corruption and poor state planning have be laden such ambitious efforts which may have had potential to improve the economic status and direction of China. With such impediments it will become more difficult for citizens to stabilize and expand the middle class; a necessary requirement for a successful nation.

China, US, Protectionism....Oh my

As the economy continues to strain American and Chinese businesses, we are beginning to see an increase in protectionism ideology. This sentiment is clearly out of concern that too much reliance on the other country's economy and business base will result in further losses. Last Friday, China passed a law that placed restriction on expedited parcel delivery services like Fed Ex. Additionally, Coca-Cola was denied in purchasing a large Chinese juice maker. Such moves as these point to the increasingly domestically based movements to localize business. Laws have become written in ambiguous manners concerning American businessmen as they feel they are in a difficult position in negotiating and expanding their enterprise. The Chinese have effectively created laws which can be used to their advantage when applicable but are vague enough to control foreign investment.

It is only natural for countries to work towards a self-sustaining and self-interest policy when economic times are debilitating prosperity. However, if China and The United States begin to break their ties in trade there will be long-lasting negative impacts. China depends on utilizing the US market as much as the US depends on China to produce goods at a cost far lower than they are capable. Instead of restructuring foreign business policy it would behoove both nations to work together in this difficult time. There are clearly aspects of our trading habits which could be improved as the US has a seemingly insurmountable deficit. However, at this time, I believe shifting China's policy in doing business with the US will only do more harm.

Model UN Reflection...Iran rocked it

Model UN was an interesting experience. It was not set up in the manner that I had expected. I thought each nation would remain in La Rose digital theater throughout the entire simulation but I was pleased to see that we each had our own room to operate in secrecy. This ensure that everyone had the ability to speak their mind and our leaders were able to research our different ideas to analyze the viability of our decisions.

I enjoyed meeting with other nations to negotiate various deals. I felt as though I had a stake in the process by orchestrating the pacts we made and having a central role in the process. It was interesting to be able to leave our group's room and converse with other nations as though we were truly diplomats. This gave me a real sense for what it is like to be a foreign diplomat in international relations. Additionally, I gained an appreciation for the complexity and difficulty in making a move at the international level. Various alliances, pacts, treaties, economic interests and enemies make it quite difficult to work with other nations.

I feel as though it would have been beneficial for our group to have completed more research on the history of Iran so that we were fully aware of the precedents for decisions we wanted to make. We had a fundamental understanding of each minister's duties and the scope of their rule; however, it would have been helpful to understand why some of our ideas were not feasible in the context of reality. Each participant should have been required to compile a list of allies and enemies and the context for which each entity is labeled as such.

I was very proud to orchestrate a deal with China in which our oil deficiency was fully taken care of and an alliance was formed if Iran were threatened by another state. In a second meeting we were able to convince China to invest in our water system to improve the quality and cleanliness of the purification process. I believe our negotiation skills allowed us to take advantage of the representatives China sent to meet with us. After their group realized how much they had relinquished for permission to set up an intelligence agency near the sea, they sent new representatives to orchestrate negotiations. This was a clear sign of success on the behalf of Iranian ministers.

It would have been interesting if we had made the acquisition of nukes a top priority from the beginning of the game. With such power, I believe the dynamics of our objectives for the rest of the game would have significantly shifted. Because we were not able to acquire the nukes until late in the game, we were not able to pose a security threat to other nations.


Overall, I believe our group (led by great IR students) was very successful. This success made the simulation very enjoyable and eye opening to the real process that the UN must work within each day.

What’s Goin on in Taiwan?

What’s Goin on in Taiwan?


Stimulated by Taiwanese President Ma Ying-jeou, Taiwan and China will soon begin to discuss a partial free trade agreement. Such talks are in opposition of the former president of Taiwan’s anti-China stance in regards to trade and economic cooperation. President Ma Ying-jeou views such discussions as an opportunity for the Taiwanese to remain a competitive player in the fiercely competitive region. The agreement would allow freer trade for goods, services, and capital but would not pertain to agricultural produces as Taiwanese farmers pleaded that their products would not have to compete with the strong output of crops by Chinese farmers. Additionally, banks of both nations would be able to expand operations into each country, flights into both nations would be scheduled more regularly, and cross-criminal investigations would be permitted.

This pact is crucial for the Taiwanese as China is the most dominant nation in the region. It will be extremely beneficial for the citizens of Taiwan to be able to access the Chinese market, increasing national exports for the strong manufacturing nation. The more economically liberal policy of Ma Ying-jeou should prove to stabilize the economy at a trying time.

As oil prices have been cut in half since last year, the Taiwanese people have experience much lower transport costs helping to stimulate a declining economy. For a nation which imports 99% of its energy, this is a critical change as citizens desperately seek a break in daily costs. Consumer prices have dramatically lessened and interest rates have hit rock bottom. In the fourth quarter the Taiwanese economy contracted by 8.36% which forced the country into its’ first recession since 2001 when the tech bubble burst.

Japan: Economy Down…Communism Up

Japan: Economy Down…Communism Up


Many Japanese are turning new interests to entertaining a communistic influence in the government. With banks failing and industry declining, many blue collar citizens are out of jobs and looking for an answer. Communism, in recent history, has been a strong second party in Japanese politics despite their little representation in parliament. Many look to communism as a method to curb the recession which has depleted the economy. Capitalism, at the time of a recession, is easy to point the finger at; however, during previously prosperous years, the communist party remained of stable size. It is important to note, however, that those who advocate communist influence are not requesting a radical or immediate response. They realize that such a movement would be counterproductive. Their focus is more centered upon increased representation so that all sides are more equally heard. The Japanese youth are increasingly enticed by the communist party to join as they are concerned of the job market after college graduation. It is understandable that those who feel uncertain about their financial future look for answers in government reformation, however increasing communist influence would not allow Japan to maintain their prominent position in world politics and economics.

I find this reaction to economic turmoil interesting as Americans, young and old, are responding in very different ways. In my personal experience I have noticed a sharp rise in recent and future college graduates who plan to immediately attend graduate school to improve their status in the severely competitive job market. Such a response appears to have a focus upon personal betterment and self-improvement as opposed to changing the political climate of the nation. This is not to say that many Americans are not calling out for governmental reform, but it is clear that American citizens realize that they must react to the recession in a manner that will allow them to beat the state of affairs.

Chinese Consumers still Makin’ it Rain

Chinese Consumers still Makin’ it Rain


Prime Minister of China, Wen Jiabao, stated the Beijing stimulus package has allowed Chinese consumers to continue to spend despite the difficult economic conditions. Specifically, tax cuts on new car purchases and lower mortgage rates are helping the two hardest hit industries. With the unemployment rate of China rising and diminishing productivity of economies in other nations; confidence, according to Jiabao, is more important than available funding as it is essential for consumers to continue to spur the economy in a prosperous direction. Confidence is so high right now that ¾ of Chinese people plan to maintain or increase their spending over the next year. Such news is a beautiful sound for automakers as they are depending on the Chinese to help make up for lost sales in most other countries. Lower and lower middle class citizens are taking advantage of government subsidies to purchase cars. Many are purchasing minivans and starting taxi services.

What does this all mean? It is important that one of the world’s largest and economically critical countries’ consumers are continuing to spend money and stimulate their economy after being hit by the declination of the United State’s economy. In today’s world, large companies are global as it is easier to expand operations and communication has improved. The current recession of the United States is clearly showing the interdependency of each economy of the major players, especially those of the G20.

As China has one of the world’s largest populations and market bases for global companies, it is imperative that these consumers are able to make up for the loss in other markets. China is in a stronger position than most that are dependent upon the United States economy as the government has consistently been more conservative in spending and citizens have traditionally saved more of their income than citizens of other countries.

Times are a changin'

You know times are changing when Japan has no one to export their plethora of goods to, China is actually showing an ability to help other countries despite their belief that their ideas do not hold enough weight in international policy, and people believe India could be the next China. All of these perspective changes are clearly correlated to the economic crisis in the United States.

Over the past week China has made their desire to have a bigger say in organizations like the International Monetary Fund (IMF) known to the public. Of course they realize the only way to make this possible is to aid other states in this time of financial downturn. Currently China is operating with a surplus which, today, is not the norm of many powerful countries. This is a perfect time for China to start putting in the money so that they can become a bigger player as changes are made.

China sees this as a good opportunity to increase its influence," said Jun Ma, China economist for Deutsche Bank. China doesn't want to miss out on the chance to help rewrite the rules that will govern global finance for coming decades. "China is more actively contributing their thoughts. This is very different from 10 years ago, when China was much quieter and more low profile," said Mr. Ma, who previously worked for both the IMF and the Chinese government.

China’s stimulus plan to offset the consequences of the crisis is one of the largest in the world. Recently, China contributed $350 million to the Inter-American Development Bank which is aiding Latin American and Caribbean nations.
While China is improving its position in international politics and economic unions other countries see room for competition. Many believe India has the potential to become the next China. Why? One simple reason, democracy. China’s oppressive “communist” government has hampered their development despite a capitalistic style economy. The most powerful nations in the world have adopted democracy and India is realizing its potential.

Admittedly slow, the democratic process has begun to set the foundations which will stabilize and deter political unrest. This will help form a stronger and more united basis of the common population which will be necessary to establish continuity and progress in the near future. In addition to improving the political and economic structure, democracy will play a large role in voicing opinions in global organizations. Other countries will be more apt to listen to the diplomats and economic leaders of India with the reassurance that the views they express are of the people they represent. Countries without the luxury of a democratic political structure enter meetings like the G20 or IMF conferences without a certainty of expressing the desires of their citizens. India believes they are catching up. They believe they have an unprecedented opportunity during this time of financial crisis. Coordinated properly, India can become a player in global economic politics.

Iranian Commerce Overview

Iran, like many Middle Eastern nations, is a country marred by economic downturn as the state controls most trading and orchestrates price controls on many necessities. The Iranian government is believed to control approximately 60% of the economy. One of the central problems the Iranian government faces is retaining their talented youth who often travel overseas to find stable and higher paying occupations. With an unskilled labor force it is difficult for Iran to modernize their economic foundations. The vast majority of Iran’s economy is based upon agriculture and oil. Such a focused dependency on two industries can become detrimental to the growth and reconstruction of a country in dire need of revitalization to their economy.
After a decline through the 1980’s and 1990’s of oil production, Iran has recently resumed production to exploit their natural resources. Iran holds approximately 10% of the world’s proven oil reserves which allow them to exploit their natural resources for economic gains.
By 2004, Iran’s annual oil production was 1.4 billion barrels, creating a net profit of $50 billion. Iran manufactures 50-80% of its industrial equipments domestically, including refineries, oil tankers, oil rigs, offshore platforms and exploration instruments. In February 2008 the Iranian Oil Bourse was inaugurated in Kish Island to trade crude oil and petrochemical products.
Petroleum dominates 80% of Iran’s exports each year and was valued at $46.9 billion in 2006. Although profitable, this reliance upon a nonrenewable resource could prove to be even more problematic for the country which still remains in strained economic conditions.
The industrial sector of Iran’s economy contributes over 11% of the GNP and employees over a third of the work force. Although petroleum constitutes a large portion of Iran’s industrialization; 70% of miners work to produce minerals like: coal, iron ore, copper, lead, zinc, chromium, barite, salt, gypsum, molybdenum, strontium, silica, uranium, and gold. Like most other aspects of industry the Iranian government controls approximately 90% of all mines. Additionally, the government is currently seeking $1.1 billion in foreign direct investment to fully exploit these potential resources.
Agriculture contributes 11% of the GNP of Iran and employs over 30% of the country’s work force. Wheat and rice are two of the majorly produced crops; however farmers also grow barley, cotton, corn, tea, hemp and tobacco on the 20% of lands that are arable within Iran. By 2003, 25% of Iran’s non-oil exports were agricultural products.
Iran has also developed strong trading ties with other Asian entities since the early 1990’s. Its foremost trading partners include: China, India, Germany, South Korea, Japan, France, Russia and Italy. In 2007 Iran and India’s trade increased by 80% surpassing $13 billion in volume. The United States, who previously was Iran’s strongest trading partner, cut ties with Iran after the Iranian revolution in 1979. Iran has developed stronger trading ties with Turkey and Pakistan; all of whom share the common goal of developing a single economic market in West and Central Asia called the Economic Cooperation Organization (ECO). This organization is modeled after the very successful European Union which fosters a better trading and investment environment for member states.
As Iran and the United States have maintained polarizing policies since the revolution, it appears as this foreign policy stance will remain constant through the near future. As Iran continues to pursue a nuclear development program, the United States will keep sanctions in place.
Tensions between Iran and the West over the former's nuclear program are expected to persist, but the likelihood of military conflict over the issue has diminished. Despite the publication of a US national intelligence estimate in December 2007 that concluded that Iran stopped developing nuclear weapons in 2003, the degree of mistrust between Iran and the US, and the determination of Iran to press ahead with its nuclear program, is likely to complicate the search for an international agreement within the forecast period.
Iran and the United States currently have made little progress in coming to a mutual agreement which would substantially change policy from a trade perspective. However, the Economist states, “the slow pace of oil output growth, and consequent stagnation of oil revenue, will force the government to rein in its expansionary fiscal policy. We expect real GDP growth to average around 3.1% a year over the forecast period.” This would translate to a continuance of the economically strained standards for the citizens of Iran. Iranian conservatives, however, are frustrated with their country’s economic management which could result in changes within the hierarchy. Such changes could translate to a more moderate political position so that Iran would have the ability to have talks with other countries like the United States.
Iran appears to have a relatively firm commitment to its reliance on exhaustible resources as a central foundation for its economy. Additionally, the Iranian government maintains its stronghold of the economy with price controls. Assuming powerful conservative leaders do not successfully demand an economic reform, Iran will continue to fall behind in economic prosperity.

Iran in Brief Review

Iran, a terrorism supporting country, became an Islamic Republic state in 1979. Its relations with the United States have been strained since the inception of the country. Located in the Middle East and bordering the Gulf of Oman and the Caspian Sea, the approximate population of Iran is 65,875,224. Of this population 51% of people are Persian, 24% are Azeri, 8% are Gilaki and Mazandarani, 7% are Kurd, 3% are Arab, and the last 7% are Lur, Baloch, Turkmen, and other ethnicities. The primary language spoken by 58% of the population is Persian or a dialect of Persian.

Iran is under a Theocratic rule with Ali Hoseini-KHAMENEI as the chief of state and Mahmud AHMADI-NEJAD as the head of government. The supreme leader is appointed for life by the Assembly of Experts and the president is elected by popular vote for a four year term. The people are not organized by political parties (except when temporarily developed for an election year) as they assemble in political pressure groups which advance the interest of the people.

The majority of country revenues (GDP is $859.7 billion) and economic activity, most of which is controlled by the state, are provided by Iran’s dependency on oil. Agriculture accounts for 10.8% of the GDP and farmers typically grow such crops as wheat, rice, sugar cane, cotton, wool, caviar and dairy products. Price controls, subsidies, corruption, and shortages are some of the most common economic problems. With an unemployment rate of 12.5% many skilled young Iranians look for jobs overseas which devastates Iran’s ability to keep its future talent.

Iran is still developing in many aspects of its infrastructure. Currently there are 129 airports with paved runways, 8,368 kilometers of railways, and 125,908 miles of paved roadways. Iran still has yet to provide telephone service to several thousand villages around the country. Today, approximately 30 million people subscribe to telephone use and 23 million are internet users.

Iran bases its foreign policy on two principles: eliminating any outside influence upon the country and pursuing stronger diplomatic relationships with developing and non-aligned countries. The United States and Israel are the only two countries which Iran does maintain diplomatic relations. In the past two centuries Iran has not invaded any other country however they have the ability to mobilize approximately 1 million men.

The culture of Iran, a predominant culture of the Middle East, is a mix of pre-Islamic and Islamic culture. Like the culture the cuisine of Iran is of a diverse nature creating combinations of rice with meat, vegetables, nuts, herbs, and fruits. The Sassanid era was a period in Iranian culture which influenced China, India, Roman civilization, and Western Europe a considerable amount. Islamic learning in philosophy, medicine, architecture, literature, and sciences were all strongly influenced by the Sassanid era as well. As two thirds of the current population is under the age of 25, sports are an essential part of Iranian culture. Soccer is very popular in Iran and the country had success in some appearance of the World Cup finals. Architecture is well defined by the early uses of mathematics in constructing various buildings. Domes are a unique aspect of Iran’s architectural interests as they can commonly be found in mosques and bazaars. Although clearly developing, Iran has many aspects of its country which are attempting to keep in line with contemporary expectations. Its influence around the world is unquestionable however its domestic issues continue to be a challenge to overcome.

It’s bad here…and (in some cases) even worse there

After some time of watching the events of the American financial crises unfold, the impacts of Asian economies are becoming clearer each day. Although initially East Asian countries had hoped they would largely avoid the aftershock of the crash they currently are realizing the effects. Both, imports and exports have significantly dropped in comparison to this time in 2008. Countries like China, South Korea, Vietnam, Japan, and Singapore are experiencing the most disastrous declines in trade. For example, “Even in China, exports are spluttering, down by 2.8% in December Singapore’s by 20%. Falls in imports are often even starker: China’s were down by 21% in December; Vietnam’s by 45% in January.” Such a swift decline has come at somewhat of a shock to Asian countries, as 2007 was a year of relative economic development for countries like China who expanded their GDP by 13%. Such dramatic declines can easily be attributed to the dominance of Western influence on Asian economies and the dependent relationship which has recently gained substantial strength. However, analysts have also determined that shortcomings in domestic demand have also largely contributed to the problem. Of course Asian countries will agree that the majority of the blame should be placed upon Western countries for enticing Eastern nations into such trade deals. At a time when citizens are looking to their government for answers they are currently coming up empty. However, Asian governments will soon be able to react by investing in public works programs, which can aim their efforts to improving the infrastructure of these nations, an investment, which is sorely needed. However, the fact still remains that Asian countries are overly dependent upon exports to Western nations, which will ultimately hamper a swift and immediate stimulus plan.

Of the nations who heavily rely on exports to support their economy, Taiwan is the clear leader. Because they have based a substantial portion of their economy on providing technological items to hungry Western consumers they have been hit the hardest.
Some of the most clear indicators of the failing Taiwanese economy can be found in the 5% decrease in average wages as well as the 5% increase of unemployment. Such statistics seem to be a commonality among most competitor nations. Worsening the situation, the wealthy management population of Taiwan has moved their factories to China. This has decreased their domestic spending which is needed to stimulate the economy.
To provide a perspective of this largely encompassing economic issue, the ASEAN summit, which is set to take place February 28th and 29th, will primarily focus upon taking the final steps to legitimize their existence and strengthen the union of the partnering nations.


"It is the first time leaders will meet since the group signed a landmark charter in December. The document made ASEAN a legal entity and moves it a step closer toward the goal of establishing a single market by 2015 and becoming a European Union-like community."

This shift in a primary focus toward the economy has come a time while human rights violations (another central focus of the union) against the people of Rohingya have occurred.
“…including the plight of the stateless Rohingya boat people who flee Myanmar and have recently washed up on the shores of Thailand, Malaysia and Indonesia — will be discussed on the sidelines but not as part of the summit's formal agenda.”
Clearly the economy is the global hot topic as nations are suffering. However, for the economy to take precedence over human rights violations, we now have some perspective of this dire situation. While the crisis is a convoluted mess, Asian entities need to begin to move in the right direction to shorten the distance of a recovery.

Post 1

Asian entities have enjoyed a recent history of quickly emerging economies which have vastly improved the living conditions of many citizens and have changed the economic mindset of those in power. However with the recent economic downfall of the United States, countries across the globe have suffered. This ripple effect has sent governments in countries like China scrambling to ensure that large corporations do not begin to implement mass layoffs. Governments in these nations have a vested interest in moving proactively to deter social unrest. Asian countries generally share the belief that it is only fair to minimize layoffs of a failing company and help workers retain their dignity. It may seem as though maintaining dignity and one’s occupation do not directly correlate; however in this region of the globe saving face is one of the most important personality attributes one can display. The Chinese government has recognized the importance of keeping its citizens employed by adding a contingency to the $586 billion economic stimulus plan that ensures corporations use their aid to create as many new jobs as possible.

There are openings for the unemployed in skilled positions; however most workers in Asia do not have more than a high school education therefore they are very limited in their options. The Guangdong province of China use to be considered “the world’s factory floor” however the recent decline in consumer demand for Chinese products has shut down a large number of factories. This alone has contributed to a large portion of the unemployment rate in China. One Chinese citizen particularly illustrates the decline in entry level positions, I used to work in a factory making flash drives for 1,600 yuan a month," she said. "Now I'd be happy to get 1,200 yuan. Before I came here, I was offered a job for about 700 yuan a month at a shoe factory in another city. I can't accept that. I'd rather go home.

In contrast to the vast majority of the population in Asia, the wealthy are taking advantage of the economic crisis in the United States. Asians are visiting America and taking real estate tours around areas which houses are worth significantly less than the usual price. One Chinese citizen stated, “The price of the house, he said, was $1 million, compared with $1.3 million before the crisis in early 2007”. Just like this man they use these homes as an investment as their value is sure to increase within the next 5-10 years. Chinese buyers seek both housing real estate and commercial real estate. This purchase of American real estate is a testament to the changing relationship between the United States and China. It is clear that China’s economy has generally enjoyed a period of immense growth and power. However the collapse of the US economy has certainly caused many of the current economic problems in China.

The world anxiously awaits and watches to find out whether the United States will regain their immense power hold as the strongest country. If other countries follow the lead of Asian countries, it is possible that global relationships will change drastically.