GarryB wrote:But not all projects succeed and make money, so paper projects means no profit but also no risk and the ones with too much risk remain paper projects.
And you'll never succeed if you don't take the risk.
So either way investments are good
That is what I am saying, but in this day an age with interests from banks being at an all time low investment makes more sense than hiding your money in a bank... why not make that money work for you by investing it in your own country... in your own region.
If you have the money, and you have the time and expertise (or a trusted party to do so)
These sorts of things shouldn't rely on central government to pay for... we should be able to sort this sort of thing out ourselves...
But you pay taxes to the central government. That's a cut from your paycheck already, that's exactly meant to cover such things, such as local sports infrastructure and whatever. Communal things and communal property, that the community as a whole benefits from collectively.
That the government might not be spending things efficiently is a different problem. The solution to which is not paying more out your own pocket, but demanding local control over government and municipal spending.
True, but if Nike builds a factory that makes shoes including special fabrics and materials (foams and rubbers and gels) that it needs to make its shoes it is not just going to walk away and abandon all that stuff... most of it will be packed up and shipped to the country they are moving production to so they don't need to buy new machines and so the locals can't just set up competitive production.
I think that's actually a more specific case, than a general one.
In general terms, I think more often than not a new factory will come with a lot of calculations about the local area and local market, it will necessitate a lot more secondary investment to train people and maybe run transport lines to the factory and whatever else. You don't really want to pack everything up and start again in a different country unless you are making a loss. While if you want to expand production and take advantage of lower wages, well then just open a new factory.
Making Nike footwear is a low-skilled job, with low-requirements, and low levels of technical expertise needed. The harder a type of production is to master however, the less feasible it is to pack it up and move it.
What really happened in the West is not so much that all the multinationals moved their factories. It's that they started investing into new factories in Asia, the Asian countries themselves started to create their own factories and companies, and ended up out-competing the existing factories, shipyards, metallurgical plants, etc.. in America, Britain and so on.
At that point, the European and American factories didn't so much move, as simply close down due to losses.
And they weren't necessarily beaten on wages; South Korean wages aren't particularly lower than Britain's yet their shipbuilding industry is the largest in the world, while Britain's once world-dominating ones barely even exist anymore.
In the end though the Western multinationals didn't mind that much. They profited from lower-cost production in Asia, often got buy into or own the means of production in those countries, while the countries who prospered were Western allies anyway such as South Korea, or Japan, or Taiwan.
Even China in the 80s was supported by the West against the Soviets.
However as China came into its own this model started to become self-defeating for the West. China has now copied or mastered their technologies, it has grown rich off the investments the West made into it, and it has ambitions of its own. So now suddenly protectionism has come into vogue again in America.
Not really... the things made in China would not be sold world wide and skipping borders and tarriffs so easily if they were Chinese companies... they are western companies so they have world wide agreements that allow them into markets that China or say Russia are blocked from.
They are Chinese companies. There isn't a single factory in China that isn't at least 51% owned by the state or a state-owned company. Now those factories can certainly produce components and end products for Western multinationals by license agreements, and do so. However there are plenty of Chinese factories that sell directly to wholesalers, industries, high street stores around the world too.
Also to bypass Russian import restrictions a lot of western companies produce their products inside Russia so there is no import at all... and like Thales they probably find that products they make in Russia are good quality well made and much cheaper than they can make in other countries so they start producing for other markets... they own the factories so they make the profits... they make bigger profits because the products can be made cheaper.
That's exactly what I'm talking about, bypassing the protectionism and gaining access to a given market is often more of a consideration that just the wages. In Russia's case it has a large internal market, and a free trade zone with no customs with a range of other ex-Soviet countries as well. Producing in Russia is good business for these Western companies.
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