The Global Capitalist

The International Herald Tribune had a fantastic article today on how the growth of China is causing monumental changes throughout all of Southeast Asia. In particular, they profile the plight of Loatian farmers who previously collected crops and transported them by foot for many hours to reach a marketplace in an attempt to sell the fruit they collected. The story shows how the recent advancement of cheap Chinese motorcycles enables the transport time to be a fraction of what it was before. This provides more income to the farmers as they can transport additional fruit to the market in a shorter amount of time.

Just as during the 20th century, the growth of America spread wealth to the surrounding nations, the same is occurring today in China. In particular, as the infrastructure grows and it becomes easier to access other regions, the ability to transport goods quickly and continuosly can open up these economies in ways they haven’t been in decades. A great example of this is the train to Tibet that the Chinese recently commenced. Arrivals to that region have risen 500% since the train began and prosperity has hit that region on a scale it has not witnessed since the revolution.

The same is true of countries like Malaysia and Vietnam. While booming economies themselves, the ability to obtain cheap Chinese made manufactured goods is one of the main ingredients in their economic success. Motorcycles are enabling peasants to live further out from the center of the city and work in areas they previously could not reach. Television is allowing the dissemination of information in ways that were not possible before, especially in nations with high illiteracy rates. Now, instant information is at their fingertips - a phenomenon that was unheard of 5 years ago. Some villagers now have access to computers through programs such as Mr. Negroponte’s $100 laptop initiative.

The transformation of lives in southeast Asia has only just begun. Perhaps a good way of investing in the China boom is to invest in the stock markets of some of its closest geographical neighbors.

The article is linked here: http://www.iht.com/articles/2007/12/26/asia/laos.php