Sunday, March 11, 2012

What is the reality of "Made in China"?

Is your Apple iPad completely manufactured in China? "The trade gap between America and China is much exaggerated" says The Economist here.

"According to a study by the Personal Computing Industry Centre, each iPad sold in America adds $275, the total production cost, to America’s trade deficit with China, yet the value of the actual work performed in China accounts for only $10. Using these numbers, The Economist estimates that iPads accounted for around $4 billion of America’s reported trade deficit with China in 2011; but if China’s exports were measured on a value-added basis, the deficit was only $150m."

See information on Personal Computing Industry Centre here.

The article concludes, "Pascal Lamy, the head of the World Trade Organisation, has suggested that if trade statistics reflected true domestic content, America’s deficit with China might be more than halved."

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