How the crisis in the U.S. housing market and new Chinese policy is affecting Chinese manufactures

It is amazing how influential the Unites States is with the world. If something happens to their economy, the whole world suffers. The same thing happens in the Dominican Republic, in which if something happens to the U.S., there is going to be an effect in our economy since we depend on the U.S. But now the housing market crisis as hit hard the Chinese manufactures. They generated a lot of demand from the U.S. housing market since they make the majority of the bathroom sets, all the way to bathroom fixtures. The housing crisis has made their demand and profit decrease. Also the Chinese manufactures have been hit hard by a new Chinese labor law that took effect at the beginning of the year which raised the the labor and energy costs, and also the superior policies for the exporters.

A lot of plants are going to shut down due to this situation. Some companies already started moving their plants to other countries like Vietnam and India, where labor is relatively cheaper but is also getting affected

Even though this is affecting their economy, I believe it has a good aspect for them. By passing down a new labor law, it is going to reduce export since China has a huge trade surplus. I believe that they need to make a balance. So now they are going to focus also in the domestic market because it will do well for the people and also good for the country. But don’t get me wrong China is not going to forget about exporting since it is a great income for their economy.

I was just so surprised on how the U.S. economic slowdown as affected different countries in the world making clear how globalize the economy is these days.