Submitted By: Deanna Haskell

‘World’s Coal Use Carries Deadly Cost,’ an Associated Press article by Charles Hutzler, highlights the effects of industrialization on laborers.

Coal mining is considered to be one of the most dangerous professions worldwide. Economic growth and industrialization around the world has caused an increase in the demand for coal, which can be used to generate relatively inexpensive electricity.

Coal is a major source of electricity for the Chinese. Coal powers many of the factories that produce inexpensive goods. Farmers have turned to coal mining as a means of increasing their income and according to the article, are more afraid of unemployment than of the frequent possibility of being involved in a coal mining accident.

The larger Chinese state owned mines have safety regulations similar to those in the United States, but the small mines do not. In fact, “80 percent of the casualties occur at small operations, many of which dodge government crackdowns, often aided by local officials who are sometimes part-owners.”

Clearly the Chinese government knows how to make working conditions safer, now the question is how can they enforce safety standards in smaller mines. According to the article, the government has blown up facilities at smaller mines that did not comply with safety standards. Since coal is so important to the local people as a means of employment is there a way to improve working conditions rather than destroying them?

Mining is dangerous no matter where it takes place: “But the death toll in China is on another scale. By official count, 4,746 workers died last year in coal mines. China’s fatal accident rate of two deaths per million tons of coal mined is 50 times hirer than America’s and nine times that of India. Many more deaths and injuries go unreported at China’s smaller mines…”

At what cost does our inexpensive electricity and the ability to buy inexpensive goods come? Next time you purchase an item made in China, will you wonder if someone died mining the coal that was used to power the plant that manufactured that item?

One of the purposes of our trip to China is to go far beyond the customary ‘oohing’ and ‘aahing’ at the Great Wall and the Bund and see how good your skills are are spotting new markets and new business opportunities. See, e.g., my recent post, Linking Global Buyers With Chinese Factories … In the Context of Lingerie.

For a number of you, the California or American market will likely not be enough to sustain your business and/or industry over the long term. My goodness; as just one example, see this NY Times article that was posted on its web site about two minutes ago, Apple Shares Soar on Chinese Interest in iPhone.

Like it or not, and whether popular or not with various political factions in the world, people with solid business skills spot market opportunities, both domestic and abroad, and try to create a business model that can fill said need, and if they want to be around for more than a few days they do so at a profit. The really admirable ones, of which there are many, work hard to do so in a socially responsible and ethical way.

I think the day will come when many of you are asked by your employer to get on a plane and fly to a place like China to see what type of business your firm could or should be doing there (or alternatively, you will be entertaining a group of Chinese business people traveling to the USA trying to better integrate their business model into the American economy).

Hence, this trip.

On that note I just came across these interesting October 11, 2007 posts by Paul Denlinger at the China Vortex blog:

• Biz Opportunity: Rolling Up and Franchising China’s Internet Cafes

• Digging Deeper About China’s Internet Usage Data

He has an interesting business take on Internet cafes in China. What I found even more interesting was his take on the sociological ‘Charles Dickens like’ significance of said venues in China.

I have been in a few of these, but never thought of what Mr. Denlinger writes about. I wonder if things might be different in China’s second or third tier cities. During your off the clock time, step into one one these cafes if the opportunity presents itself and do your own market research.

By they way, during this year you will often hear the terms “first tier cities” (e.g., Shanghai, Beijing, Guangzhou, etc.), “second tier cities” and even “third tier cities” in the context of our China discussions.

Do you know how many cities China has with over 1 million people? China officially has 49 cities with populations over 1 million (source: Rob Gifford’s, China Road, 2007). This is a country where you can travel across China, arrive in a city that is twice the size of Houston, and never had heard of the place. This largely urbanized population can (not always) mean that American products are able to penetrate the Chinese market more easily.

What about India? Try 39 (as of 2001; source: List of Million Plus Cities — India, Wikipedia)

Did you know how many the US has? Try 9 (as of 2000; source: Nations Encyclopedia).

To appreciate China and India, at some point you have to try and get your head and arms around the masses of people and humanity in these two countries, and then think of how that impacts what you are seeing, feeling, tasting and smelling while you are there.

For example, most Westerner political leaders seem to have drunk that Kool-aid that makes them believe and argue that ‘western style’ democracy is a good thing that the rest of the world should follow and they don’t get why the rest of the world does not do so. Yet, one thing they often gloss over and never explain to the rest of us country bumpkins is whether such a model can really work in a country with a population of 1.3 billion, and how? Criminey, we/the US have a hard time moving forward and reaching a consensus with a population size of 330 million of largely white people. If a country had 300 federal level senators, rather than the 100 US talking heads, er, I mean US Senators that we have, with 50 plus ethic minorities such as China does, how would they function and get anything done in a reasonable time period?

India is a democracy, and it’s diversity of people is incredibly immense, but many believe that it has become a hyper-democracy that can’t get much done at the governmental level (but the business level is a whole other story).

See also this related article by NY Times Senior Reporter Harold French International Herald Tribune article titled, Letter from China: What if Beijing is Right? You also need to read Randall Peerenboom’s, China Modernizes.

What markets do places like China and India present, that you think you-your firm-your industry will be a part of in the future, whether you like it or not?

And is democracy the answer for China? If so, highlight what you think that would look like and how it would work, and then patent your solution — you will be rich and will have provided an answer to a complex question that nobody else has yet persuasively come up with and/or argued.

The Good

I define globalization as increasing integration of trade, economic relationships and financial networks across national borders. No doubt there are different and/or more politically charged definitions out there.

I do not hide or shy away from my own bias that the pros of globalization (using the above defintion) outweigh the cons. I grew up in a very, very rural agricultural part of the Midwest (nearest town 6 miles away; nearest neighbor three miles away). There were no Paris Hilton’s or Prince William’s in my family.  There was not a rich relative in the family who formed a start up they sold for a wad of money or family trust fund passed down from generation to generation to insulate us from economic downturns. When things went bad economically due to global changes for dirt farmers and ranchers like those in my own family, we saw it, we felt it, and let me tell you … it hurt.

Yet, while in some ways globalization hurt my family and the way in which we made our living even back in the 1970s and 1980s (yes, globalization has actually been around a while), in many other ways it helped us. It forced us to step out of our comfort zone, change, adapt, and compete; or economically die.  Whether we elected to change in a positive, constructive way (e.g, as opposed to shaking our fists at the sky or the world and taking revenge on neighbors, governments or others because we were upset that the status quo had changed) was up to as and whatever decision we made we had to own.   I now look back 20 years later and have concluded that was a good thing. I am a better person for it. I am more comfortable with and better able to adapt to change in the world.

Here is a excerpt from a good friend of mine that is American Chinese and who does business in China, which I received over the weekend, that similarly echoes how American firms and the American public might start viewing this topic rather then only listen to what Lou Dobbs has to say on the subject. [I sanitized the email to protect his identity and clients and the industry at issue]:

Chris –

Recently I have been involved in some policy debates about regulating the [XXX] industry. The industry itself sees threats from Chinese [firms], as many from this industry are outsourcing their cases of product directly or indirectly (through people like myself) to China. They are urging the FDA to regulate the business. It’s interesting to see how the mainstream American businesses think of China and what their reactions are. I on the other hand always encourage people to think differently and form alliances with Chinese [firms] , rather than fear them and run to their government, trade association or the press for protection, so that they can be more competitive. The [XXX] industry is an interesting facet of the American economy and politics and protectionism to study because it’s rooted in every community and it involves a lot of people whose names or companies are unknown to majority of Americans.

Encouraged by my clients, I am organizing a group of American owners to travel to China for a week next year, much like you do with your MBA students, so they can see for themselves how Chinese do it and whether the workers are chained to the bench 16 hours a day to crank out cheap product for their industry.

Globalization is a reality that requires us to assess the risks, opportunities, costs, and strategies involved, then change. The traditional knee jerk American defensive strategies (e.g., product labeling, FDA regs, labor/IPR violation allegations, the Made in the USA game, other trade restrictions, etc.) just don’t and won’t cut it over the long term.

The average Chinese entrepreneur and firm learned this lesson long ago — after all, their ancestors built the Great Wall as a defensive mechanism, and it never worked!!

Stated differently, my colleague encourages his clients (and America) to stop being lazy with an entitlement and victim mentality, get out of their comfort zone, learn to better stand on their own and compete, and form new, non traditional types of relationships with people and firms that they have never before been forced to understand, work with, and respect.  I don’t minimize the fact that this is easier said than done.

Part of the beauty of this course and trip is that you will get to see, feel, smell and taste, in person, various facets of globalization. You will get to see, first hand, whether what my friend addresses above is true or false, and all the shades of gray that go with it.

In some of my classes I have shown the video, Globalization is Good, which promotes globalization with somewhat starry-eyed praise. It more than does the trick, yet I find that most (not all) students who watch it surpisingly generally don’t seem to critically question it as much as I would expect or see any problems in general with globalization.

However, in the interests of fairness, below I also highlight some contrasting points and resources to consider about this understandably emotional topic.

The Bad and the Ugly

Below are some “globalization is bad” resources, some of which I use in my classes. Some are very well done; others fall into the knee-jerk screed category and/or only address limited facets of globalization. That said, the below are still worth checking out.

Note: For one of the more balanced books out there on the subject, I strongly recommend you read Georgetown Professor Pietra Rivoli’s, The Travels of a T-Shirt in the Global Economy: An Economist Examines the Markets, Power and Politics and World Trade. This is an excellent book that is also a great read. And I love how she takes both camps to task with a not so subtle, “shame on you and a pox on all of your houses for your selfish positions and disinformation campaigns.” And her real skill is that even at the end of the book, you never really quite know where she herself stands on the subject.  That is, the reader has to think for himself and reach his/her own conclusions.

‘Globalization is Bad’ Resources:

Is Wal-Mart Good for America? – This is a previous blog post I made, and is one of the blog posts and videos you are required to watch as a part of this course.

China: The World’s Smokestack – A NY Times video that documents how China’s industrialization has impacted the country’s rural and urban landscapes. Be sure to read and catch the captions at the bottom of the screen. Some good pictures.

Choking on Growth (And On Our Own Comfort Zones) – This is a also a previous blog post I made featuring another NY Times video.

For a good National Public Radio story about Cancun, and how globalization has benefited large American-based hotels, but not local citizens of Cancun, click HERE.

For an interesting clip about the new train to Tibet, and the effect it is having on the Tibetan landscape and culture, click HERE.

You might also check out this story about how Cambodia’s textile industry is struggling to adapt after the termination of the multilateral fiber agreement. Click HERE.

Trading Democracy – This is a Bill Moyers Report that is also excellent for NAFTA issues.

The Corporation – Parts of this documentary do not glamorize the effects of globalization.

This Is What Democracy Looks Like – This resource addresses the Seattle demonstrations by worker group protesters and environmentalists during the WTO meeting there a few years back. It definitely shows the other point of view, albeit from the emotional perspective.

You can also find a number of videos when you type in the term “globalization” on YouTube. I have also heard that places like MIT, Yale and Berkeley also have some good videos on line that you can access.

Other:

See the China Vortex blog’s post, Why Globalization Will Fail.

Some scholars have suggested that globalization and its heavy consumer and consumption mentality, imposes highly offensive cultural imperatives upon resistant populations, which in turn results in religious fundamentalism and militaristic nationalism. This is certainly relevant today. Can you say Iraq? Pakistan? Indonesia?  On this note, as an example, see Yale Law Professor Amy Chua’s book, World on Fire.  She is not necessarily against globalization per se, but she does argue that globalization has incited economic devastation, ethnic hatred and genocidal violence in the developing world.

Gunter Grass argues that ‘free marketism’ is “repeating the mistakes of Communism — issuing articles of faith that deny there is any alternative to the free market and claiming infallibility.” Like Communism, he predicts globalization will find itself relegated to the dustbins of history.

Branko Milanovic of the World Bank’s Research Department offers a standard economic analysis to argue that globalization has been a disaster. He argues that it was disastrous in the 19th Century (1870-1914), and it is still disastrous today. Like Grass, he also equates globalization with that big bad bogey man that we know as Communism. While he concedes that globalism can raise economic standards, he argues that this is accompanied by unfair inequalities of income distribution.

Finally, you might also check out John Gray’s 1998 book, False Dawn. This well-known British economist and social critic argues that globalization is the last gasp of a utopian belief stemming from the Enlightenment that there is a single economic and cultural model suitable for all of humanity. He writes that a global free market is a project that is destined to fail because “human beings need, more than they need the freedom of consumer choice, a cultural and economic environment that offers them an acceptable level of security and in which they feel at home.” (Editorial note: the problem I have with this latter argument is that I have found that learning is uncomfortable, as is change; yet, if we are not forced to do it as human beings, we rarely take the steps to make it happen ourselves. I.e., sometimes stability and security are good things, but not always; as an example, let me take you back to parts of where I grew up and how you how little or no change can hold people back for achieving their dreams, and this is also one of the purposes behind this trip — to get you out of the West-California-USA, comfort zone and become more comfortable with the business energy that is a part of Asia).

Final Remarks

So … how do you define globalization?  Tell us?  And where do you come down on all of this, and why?

Is your position a case of ‘where you stand depends on where you sit’?

It matters not a lick to me which side of this debate you buy into. But it does matter to me, a lot, that if you graduate from our business program you are able to intelligently and thoughtfully discuss both sides and arguments of this important topic.

The good, the bad and the the ugly. The title of this post AND one of the best movies and spaghetti westerns of all time ….

Submitted By: Ashley Drum

This is a very interesting article from the Wall Street Journal about the impact the 2008 Olympics is having on Beijing and the promises that the Chinese Government made to win the Olympic bid.

During last Fridays meeting, Dr. Morris told us about the strong sense of pride that Chinese people exhibit for their country, and the upcoming Beijing Olympics is no exception. From the symbolic starting date of 8/8/08, which is associated with prosperity in Chinese culture, to the $38 billion they are spending on the Olympic facilities and infrastructure, these games will showcase the rising power of China. The government has gone as far as developing an Office of Weather Manipulation as a way of preventing rain during the events to ensure that viewers all over the world see the best that Beijing has to offer.

But behind all the glamour, it is important for us to look back at the promises the Chinese government made to win the Olympic bid. Liu Jingmin, the deputy-mayor in 2001 when the bid was won, said that “by applying for the Olympics, we want to promote not just the city’s development, but the development of society, including democracy and human rights.” They also pledged to improve Beijing’s environmental conditions but little has been done to fulfill these promises.

Reporting on the Olympics has become a concern within a country known for its restrictions on free speech. Beijing has said that foreign reporters will not have limitations but local journalists will still be restricted by the government. I don’t think that the Olympics should serve as a means of political reform, but the Chinese government should not have made claims about developing their society if they had no intention of doing so.

Environmentally, China has done little to improve on Beijing’s increasing pollution problem. Currently, the city exceeds the World Health Organization’s clean-air guidelines by 78%. Because of this, athletes that are participating in the games will be given activated charcoal masks, ibuprofen and asthma medication as a way of dealing with these conditions.

This article has made me question if the Chinese government made blind promises as a way of winning the Olympic bid. I agree with Sun Weide, a spokesman for the Beijing Organizing Committee when he says that “we have to remember that the Olympics are a sports event, not a political corrective,” but I think he is forgetting that it was the Chinese Government who made these proposals. So as we all watch the glitz and glamour of the Olympics next year, stop to think if the Chinese government held up its end of the bargain or if their $67 billion dollar investment is a smokescreen to the real China.

[Prof. Carr Addendum: See also this related WSJ article, CCTV Tower Mirrors Beijing's Rising Ambitions. Be sure to click on the photo show button embedded in this article. I had my taxi driver take me by this thing a few weeks ago when I was in Beijing. It is MASSIVE!!]

Submitted by: Gary Chou

This is a summary of the journal article, China and India: The Reality Beyond the Hype – a research paper written by Deloitte Research, a subsidiary of Deloitte Consulting.

[Prof. Carr Addendum: Gary's post is a good post that's relevant to our session last Friday. If you have further follow-up questions for Dr. Morris or Dr. Singh, please make a comment below and pose the question. If the number of questions is manageable, I will email them and ask them to jump in and try to respond to all or some of them.]

*** *** ***

We learned last Friday that China and India have been the richest nations with advanced technology for the most part of human history. Yet this changed dramatically as these two countries took a backseat in recent 200 years. Today, China and India seem to be promising grounds for the future of a globalized economy. As emerging business leaders, we shall look at these countries side-by-side so to better understand their growth potential and business environments.

Introduction

Why did the price of oil and other commodities rise in the last five years? Why is the US able to fund a massive external deficit without an increase in interest rates? Why have global prices of manufactured products declined in the past decade relatives to other goods or services? China had played an important role in these questions.

Being the second largest oil consumer, China has contributed to higher oil prices. By linking its currency to US Dollars, in terms heavily undervaluing its Yuan, has accumulated US external [trade] deficit. Its massive investment in manufacturing capacity also drives down production margin. As India goes through a similar path, do these two countries which represent 40% of the world’s population and 25% of global GDP, have the same business environment? If not, how are they different? As a prudent investor or global businessman, what shall we know about their comparative advantages? How shall we leverage their traits to our advantages?

Answers to these questions are crucial, therefore you must read on.

Sources of Growth

Economic growth is driven in large part by investment in capital. China is a richer country due to having higher investment. However, China has a lower return-on-investment (ROI) because of an inefficient market.

China has invested far more than India. Between 1994-2004, Chinese investment accounted 37.5% of GDP verses 22.5% in India. China has higher investment because of higher level of personal and government saving and a much higher foreign capital inflow. For example, China saved 39.7% of GDP while India saved 21.9% of GDP.

With such high investment rate however, China should boast even higher growth rate than observed. China’s ROI is hampered by an inefficient financial intermediation. Much of China’s investment was undertaken by state-run companies borrowing from state-run banks. By making investments decisions basis on political goals, it goes without saying that markets allocate resources more efficiently than governments.

Doing Business in China and India

Comparing these two countries, China seems to be favored over India. In addition to a higher cost of doing business in India than China (according to a World Bank report), several other factors are considered:

Infrastructure

In 2002 China spent US $128 billion on power and transport infrastructure compared to US$18 billion for India. China’s highway network amounts to 1.4 million kilometers compared to 200 thousands kilometers of India. Also, due to insufficient port capacity, the lead time for Indian exports to the US is roughly three to four times greater than Chinese exports. In fact, according to a commentary in Asia Times, a cargo that takes six days to travel from Singapore to Mumbai could sit in the port for 30 days before it is unloaded. The reason is that there is insufficient capacity to service today’s large cargo ships at Indian ports. The global shipping industry has undergone a technological revolution in which India has been a minor participant.

Regulatory Issues

Although India has promulgated considerable deregulation, there remain many laws that are a legacy of its socialist past. Labor laws designed to protect workers have the effect of discouraging new employment. The Industrial Disputes Act says that companies with more than 100 employees require government permission to dismiss workers. Workers also cannot work more than 75 hours of overtime per year.

China’s labor on the other hand is lenient and most of the time easily bypassed. Chinese factory workers easily work 12 hours a day, far more than the 8 hours day for Indian factories.

In terms of retailing, China has recently ended most restrictions on retailing and is experiencing massive investment in modernization of the retail sector. Not so India. There, foreign investment is mostly banned and local retailers remained very small by global standards. The result is a highly fragmented industry with inefficient distribution. As we know, this discourages the economics of scale.

In terms of trade barriers, India has lowered the average tariff from 56% in 1990 to 28% in 2004, while China has dropped from 32% to 6% in the same period. A huge difference in any regard.

Demographics

China’s demographic is not so much different than those leading developing countries. Aging population with little young people observed commonly in Germany and Japan is also commonplace in China, due to its one-child policy. India on the other hand has a much younger population which translates to a window of opportunity for a few decades that its labor force will accelerate in growth. This depends crucially on the economic flexibility to allow for the creation of millions of new jobs.

China also has a more literature population: 15% of China’s population aged 18-23 is enrolled in college while 7% is in India. 91% of Chinese adults are literate versus 61% of India. Among females, the numbers are 87% and 45% respectively. In China, there are 18 students per teacher versus 24 in India. China also spends more money on R&D, has greater ubiquity of computers and internet users, and publishes more articles in scientific and technical journals.

On the other hand, India has a great advantage when it comes to exporting services. That is the high number of fluent English speakers. Yet China’s government has decreed that all students must study English after the age of five.

Manufacturing

The average monthly wages in manufacturing in India is $28 while China is $110. Combining a more skilled workforce and a much higher wages in manufacturing, the production of low-value-added goods is likely to become prohibitive for China. On the other hand, India is likely to move toward the direction of becoming a manufacturing hub.

The Future of China and India

* Both will grow rapidly, taking a much larger share of global GDP. Yet for the foreseeable future, China is likely to grow much faster.

* The division of labor between India and China will become blurred as both countries excel in services and manufacturing.

* Trade between the two will expand, enabling companies in both countries to achieve critical mass. For global companies selling in these countries, this means more local competition.

* Both countries, while remaining relatively poor, will experience rapid growth of the middle class, creating vast new opportunities for Western companies to sell in those markets.

Hypothetical

You are a female MBA graduate and alumni from the Cal Poly Orfalea College of Business. You have been working the consulting track or big firm corporate grind for the last three years. Already, you are burned out and tired of taking orders from high maintenance clients and bosses. You are convinced that the time is right for you to become the master of your own business destiny.

You also recently learned that you are pregnant (or if you are a male graduate, flip this hypothetical and assume that your wife is expecting).

You want to keep your sex life going strong during your pregnancy, and you decide that finding some sexy lingerie that you can wear (or your spouse can wear) as an expecting parent can’t hurt your cause.

The challenge is you can’t find such lingerie anywhere in the US for you or your spouse, and you quickly realize there is a market for making and importing your own. Of course, you are an environmentalist and supporter of sustainability, as all good young people of today are, so said clothes will only be made from the finest organic cotton and by a factory that is certified under international standards and pays its workers well above the normal living wage.

You are bright, hard working and we trained you well to, among other things, spot niches in the market that have not been filled. After all, you went to China for one of your Cal Poly MBA courses, and honing your skills to spot new business opportunities was one of the very purposes of the trip, and while on the trip you paid attention, really threw yourself into it, and actively took ownership of your learning in that hybrid course were a good part of the learning took place on your own time by participating the course blog and delving into its many listed resources and blog discussions and debates.

A business idea and light bulb goes off. You decide to quit your job and take $50,000 from your savings (or your parent’s savings) and credit-card borrowings to start a maternity lingerie brand called, “Poly Hotty Sexiness.”

All you need is the right manufacturer to execute on your designs. You remember from your Cal Poly China MBA visiting some factories that convinced you that China may be a good place to place such work.

What will you do and how will you find one?

You previously read Professor Carr’s post on Chinese trade shows (Visiting A Trade Show In China), but you do not have the time, desire or budget to go that route.

So what will you do?

You might start by reading this Wall Street Journal article about Jack Ma’s Alibaba titled, Site Linking Global Buyers, China Factories, Plans IPO, which essentially tracks the above hypothetical I discuss. See also this very good and related SF Chronicle article titled, Alibaba.com and the Rise of Entrepreneurial China.

What’s the downside? How will you vet the manufacturing contacts you make on the Alibaba web site? See read this post from Dan Harris at the China Law blog:

I Hate Alibaba (The Website, Not the Company)

See also this related article from VentureBeat, Alibaba Shows China In Bubble.

So, do you have the guts to go for it? Or, will you get your resume ready for that next ’safe bet’ mega company or consulting firm? Discuss.

I have been to the Great Wall several times, but never saw this. Click HERE.

Your so sexy for his shirt, so sexy for his shirt, sooo sexy it hurts …

Right Said Fred – the greatest one hit wonder of all time!

Enough levity. Scroll down and comment on Ryan Moore’s post …

Submitted By: Ryan Moore

Check out this NY Times article on the export and import of “illegal” Chinese pharmaceuticals.

Did you know that approximately ½ of all of the active pharmaceutical ingredients sold in China are made by uncertified chemical companies? Did you know that these companies are responsible for the poisoning deaths of nearly 100 children in Haiti in the mid 1990’s? Or that more than 138 Panamanians were killed or disabled in 2006 by these companies? These unlicensed companies sell their products to markets in the Latin America, Europe, Canada, and the United States. The real shock is that the Chinese government has not only known about this practice for over a decade, but it actually owns many of these companies! And you were worried about led paint?

It is clear that the Chinese government has been doing little to stop this practice. There is blatant marketing and advertising of active pharmaceutical ingredients by uncertified companies in deliberate violation of Chinese law.

One of the primary causes of the problem is that China’s food and drug agency that regulates pharmaceutical companies has no jurisdiction over chemical companies. The majority of these companies make their profits by selling their products to underdeveloped countries or over the internet.

Although China is taking small steps toward improving this hole in regulatory procedure, it may be too late. It seems that this “illegal” business has had an opportunity to become deeply rooted in relationships with “legitimate” pharmaceutical companies and other middlemen throughout the world – as well as with the Chinese government itself.

Furthermore, it seems that recent globalization has helped to mask the true source of many of these drugs. In what ways do you think globalization has helped these companies operate and what are some of the things that can be done to stop this problem?