MODEL CRISIS AND NEED FOR FURTHER ECONOMIC INTEGRATION OF CHINA IN THE FDI ACTIVITIES.- AND Germany

 THE MAIN TREND IS THE REVOLUTION

Notes on the International Situation

ENOUGH IMPERIALIST EXPLOITATION! IT MUST END!

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NEW RELEASE

MODEL CRISIS AND NEED FOR FURTHER ECONOMIC INTEGRATION OF CHINA IN THE FDI ACTIVITIES

A little more about this process and its significance:

On the study published by the Canada Ministry of Commerce, cited above, the following is noted:

"It is important to note that many of these international supply chains are regional, not global. The cost and unpredictable delays involved in intercontinental shipping still matters. Moreover, co-ordination in the same time zone is easier and more reliable. An additional factor that has fostered regionalization over globalization is the fact that the cost of moving key managers and technicians has not fallen radically. If a Canadian firm puts a factory in Mexico, the manager may have to spend a whole day to hold a one-hour face-to-face meeting. If the factory is in China, the time cost will be more like one whole workweek."(59).

In this study they overemphasized that it is a "regionalization" and not "globalization". Underneath "regionalization" as we have said, they are trying to hide: the actual division of the world by imperialist countries’ finance capital, how the world is divided up today and how

the new division of the plunders from what was the Soviet social imperialism´s Influence area is occurring.

So let us continue with the synthetic history of this process:

"The first large-scale production unbundling started in the mid-1980s and took place over very short distances. The maquiladora program created “twin plants,” one on the US side of the border and one on the Mexican side. Although the program existed since 1965, it only boomed in the 1980s, with employment growing at 20 percent annually from 1982 to 1989 (Federal Reserve Bank of Dallas 2002, Feenstra and Hanson 1996). Another second unbundling started in East Asia at about the same time (and for the same reasons). In this region, distances are short compared with the vast wage differences (Tokyo and Beijing are about 90 minutes apart by plane, yet in the 1980s the average Japanese income was 40 times the Chinese average). In Europe, the second unbundling was stimulated first by the European Union (EU) accession of Spain and Portugal in 1986, and then by the emergence of Central and Eastern "(60).

Here is the process at a glance. The maquiladora program, to which it refers, is the OAP (overseas assembly programs), which was established in the US in the early 30s of last century to lower costs and secure supplies of intermediate products for the steel industry. Let’s see how after these the steel industry is pushed in our countries (Argentina, Brazil, Peru, etc.).

Regarding the development of this process in the US, one of the studies cited in the Book concludes:

"European nations. U.S. import data suggests modest growth in parts trade, relative to other complex goods. It appears that much of this relative growth has occurred in the form of increasing relative quantities of parts shipped, rather than changes in relative prices or the relative number of source countries."(61).

Which means that the "fragmentation or international dispersion of parts production and their assembly in an integrated production process", in North America, sphere of domain of the single hegemonic superpower and the country that trades with the highest number of countries of the world, only occurs in a small way and focused primarily in Canada and Mexico; which means that the Yankee imperialist capital (their FDI) , in order to organize their monopolies internationally, acts  in every region of the world according to the given conditions.

"The value of import content in exports in 2005 represented an average of 23% of total trade between the countries of the OECD; in some countries, including as Luxembourg, Hungary, Ireland and Estonia (see these as already noted Huber, except Luxembourg are small economies, these countries are in the Third World-our note), contained imported part in exports It exceeded 50% in 2005. In other countries like the United States, the Russian Federation, Australia, Brazil (on Brazil is a semi-colonial country and a high degree of "re-primarization" of the economy .... see note previous delivery and steering of the Revolutionary Front for the Defense of the People of Brazil at the World Cup, our note) and India (also a semi-colonial country or the Third World, our note) the imported part on the vertical trade was less than other countries because of its size. This relatively small value of vertical specialization for large countries reflects more the relationship with VCGs is located within the vastness of the country ".

" Vertical specialization takes place both within MNEs and through offshoring to external suppliers. The results for the VS1 measure suggest that the import content of exports is closely related to the presence of MNEs. The increase in vertical specialization comes most clear in countries with a high multinational presence. Foreign affiliates in different host countries produce intermediates that are then exported to final consumers, but also to other affiliates and to the headquarters of the multinational company. The degree of vertical specialization is found to be particularly large in more basic industries that are heavily using primary goods like cokes and refined petroleum, basic metals, chemicals, and rubber and plastics. A second group of industries concern higher technology intensive industries that produce modular products. Parts and components are often produced in one country before they are exported to another country where the assembly is taking place. This international division of labor is found in industries like electrical machinery, radio/television and communication equipment, office, accounting and computing machinery but also motor vehicles (...) This position of countries in GVCs is assumed to be directly related to the technological profile of countries (Uchida and Inomata, 2009): the production of parts and components for consumer goods especially in high technology intensive industries, requires on average larger technological capabilities and more advanced business processes, hence these activities will be relatively more undertaken in technology advanced countries. The assembly of parts and components into final products, even in higher technology industries, is rather based on simple routines and hence less technological advanced countries will ‘specialize’ in these activities (...) Hungary, Indonesia, Estonia, the Czech Republic and the Slovak Republic show a strong integration in both intermediates and final goods (…)  In contrast, countries like Japan, United Kingdom and the Netherlands seem to specialize more in the production of(high value added) intermediates (...)over the period 1995-2005 showing the increasing importance of downstream assembly activities in China. However, at the same time, China seemed to have also moved into the more upstream production of parts of components (for the production of other intermediates), which is most likely related to the technological upgrading of the country over the years. Other studies have also suggested that some assembly activities are increasingly moved away from China to other Asian countries like Vietnam, Cambodia and the Philippines. (...) The strong increase in both vertical specialization measures for China e.g. over the period 1995-2005 demonstrates in the first place that China has become more central in international production networks, both as an assembler of final products and producer of intermediates. Second, the large vertical specialization of China (especially the still large (downstream) assembly activities) indicates that the competitiveness of China is largely built on the intermediates produced somewhere else. In Asian countries like Japan, China and Korea, the majority of the intermediates embodied in their exports are sourced from within the region. Previous research has shown that a triangular trade pattern has emerged in this region, in which parts and components are produced by more developed countries like Japan, and Korea and then exported to emerging countries like e.g. China and recently increasingly also to other countries like Vietnam, Cambodia and the Philippines where the assembly of the different intermediates into finished products is takes place. The assembled final products and intermediates are then exported back to Japan, Korea, etc. as firms re-import a growing part of the production they relocate. Assembled products from China are also exported to other developed countries/regions such as Europe and the United States where they may undergo in addition some smaller changes (packaging, marketing, etc.) and hence appear in the vertical trade of these countries. The case of Apple’s iPod illustrates this clearly: components for this product are produced in Japan, Korea and the United States, are then assembled in China and then exported to the United States (Linden et al., 2009). (...)The regional character of GVCs is also clearly illustrated when identifying so-called ‘dominant’ links of intermediate trade flows between economies (…) which represent more than 15% and 20% of the total exports of the (exporting) country (…). The results suggest the existence of 3 large groups of economies in the global trade of intermediate products: NAFTA, EU and Asia including East Asia (with Japan, Korea and China) and ASEAN economies (…) export flows between individual economies across different regional groups are significantly less important.(in terms of intermediates) (...) "(62).

As a comment to these quotations we just want to point out that this so-called process of "dispersion" is not in one way, even the multinationals export parts and high-tech components to its subsidiaries or producers abroad and import both end or assembled products and intermediate goods (parts and components intensive in labor). It´s Importantly to contrast this against those who speak of the imperialist countries as "post-industrial societies." In addition, some companies or sections of these are relocated abroad, while other foreign companies or some of its sections are located in the same country.

MODEL CRISIS AND NEED FOR FURTHER ECONOMIC INTEGRATION OF CHINA IN THE FDI ACTIVITIES

Furthermore, the above quote is important because it shows why the model is in crisis. Because of the needs of the imperialist FDI, China now has to move to other activities where FDI can find more profitable opportunities. The reason is that average wages cannot be maintained so low indefinitely in the most labor-intensive industries; consequently the investments have to move to where it is cheaper. For the same reasons that China specialized in these activities, now it must move to "more activities" as those produced in South Korea and Taiwan (countries, which as we have seen, are semi-feudal, semi-colonial and with bureaucratic capitalism, where the imperialist finance capital generated their "daughter" companies, which then generated "granddaughters" in China and elsewhere), where it is said there are more mature foreign direct investment (FDI).

China is losing its comparative advantage over "to other countries in Asia in the activities of parts, components and assembly production that are" more labor intensive ". But that is not enough, China has become increasingly dependent on the imperialist FDI, it needs to integrate more in international activities and financial services ("scape forward"), to be more open to foreign financial capital. Thus, in the future the Chinese revisionists may show improved macro data, but the economy will be distorted and will sink further and will become even more dependent. View the OECD 2014 document, on the diagnosis and needs of the Chinese economy (63).

Let´s recall that in previous quotes and comments we have seen that the components and parts that are more intensive in technology are mostly manufactured by companies of bureaucratic capitalism of Asia, Korea and Taiwan, which have been mainly generated by Yankee or Japanese FDI with greater emphasis since the 60s; the Chinese "comparative advantage" that attracts imperialist FDI is the "abundance of cheap labor" and under the yoke of fascist discipline (securities for FDI), more favorable conditions for investment, within which is the privileged access to the North American market and it must be added by the way that  the revisionist bureaucracy corruption will serve to further boost the entry of FDI and promote private monopolies and, therefore, to fuel the contradictions between the big bourgeoisie factions in China.

Let´s keep in mind, the particularity of the development of the monopoly capitalism in China, where from the beginning appears joined the immense State power with the monopolies´ power, through the "personal union" between government officials and businesses. While in other imperialist countries, the merge between the monopolies capitalist and the immense State power occurred some years after that the capitalism entered its monopoly or imperialist stage. Around the First World War, monopoly capitalism became state monopoly capitalism.

Everything we've been saying on FDI and China shows that it flows from the US, Japan, Germany, etc. -either directly or using Hong Kong or others as a bridge-; because there are gains opportunities, since it is more economically backward. This shows, that the Yankee imperialism remains the only hegemonic superpower and then the others are stronger and better organized than the Chinese social-imperialism, they are superior to it; and, therefore, shows us how the force relationship among the imperialists is in these times. Without forgetting, that the US imperialism is a colossus with feet of clay that every day is sinks more and that it is, like all imperialists, paper tigers.

The so-called "comparative advantage"

In a study of the "Chinese miracle" (64) published by the UCM, we read:

"Chinese wages are four times lower than the Latin American average. In 2002, the average monthly wage in the Chinese manufacturing sector was $ 112, while in Mexico was $ 440, and in Central American maquiladoras was 300 "

Another study also by Mexico (65) established in this respect:

"Mexican vs Chinese factors Comparison. 1. Labor cost: "The great Chinese advantage" over Mexico and many other developing countries is its 1.3 billion population and the Mexico´s population is of 107. International companies look around the world, in a precise manner; the cheaper production factors since the reduction of some cents per unit produced can mean maximizing profits and this in turn minimizes costs. Thus China provides one of the cheaper labor costs for companies that make intensive use of labor –semi trained work - for exports. Given this advantage, many maquiladoras have moved to those Far East countries, companies such as: Microsoft, Kodak, Lenovo, Dell, Motorola, Olympus, Michelin, Bridgestone, Goodyear, Tetra Pak, where wages can be a dollar an hour, while in Mexico the workers can earn three dollars an hour, which is twice the costs in China. "( Mexican and Chinese National Advantage in the XXI century* .Danae Duana Avila, Universidad Autónoma del Estado de Hidalgo century Menidia López Lira.2 Mexico State UA p. 4, 2003).

The comparative average workforce compensation is very instructive, returning to the study of Australian university we have been quoting, in the "Table 1 (66): Average annual compensation per worker, in selected countries, around 2000" 

 

 As it is stated in the foregoing chart, around 2000, only Indonesia and Vietnam had lower wages than Chinese averages. China had lower wages than the Eastern Europe and all other Southeast Asian countries and also Mexico. Therefore, part of the maquiladoras moved from Mexico to China in the late 90s of last century. But, as is an economic law, wages in China has also to go up and as they are in the labor market for imperialist maquila and intermediate goods with low value attached (intensive use of labor); therefore, on the one hand, as Korea in the last two decades of the previous century, we will presence a great intensification of the class struggle in China, and this in a very different subjective condition to that of Korea, because the Chinese proletariat has a historical experience like no other, it has reached the first great proletarian cultural revolution and, on the other hand, as is also increasingly occurring , there will be a greater drain of imperialist foreign capital activities because of rising wages, increasing daily the ghost towns and cities (there are cases where cities with over 400,000 inhabitants have been reduced to 40 000 inhabitants).

High technology goods Exports are not a sophisticated expression of internal development of China

Continuing our comments on the quotes entered in the part about the " Model Crisis ...", our underlined part highlights the fact that the rapid growth of high technology products exports are not a sophisticated expression of internal development of such industry in China, but the product of China's reliance on FDI and the imperialist world market, specifically of the components imported produced by FDI in countries of bureaucratic capitalism in the region and the higher value attached components (high technology intensive) are produced in the imperialist countries like USA, Japan, Germany, etc.  The imperialist capital uses China for the final assembly (maquiladora), for the advantages it offers: the abundance of cheap labor (comparative advantage). Therein lies the "export success" of the "Asian giant". This explains why Japan gives in, as a global exporter to the Chinese push and at the same time increases the FDI of Japanese origin to countries of bureaucratic capitalism in the region, which are parts or components suppliers for the Chinese assembly industry.

To illustrate this dependence, we present Figure 1 (67) about: The evolution of the regional production network from 1985 to 2005. Period in which China, being in a marginal situation until 1985, then it appears first, around 2000, as an assembler of components from nationalist china  (N) and South Korea (K), then it moves to fill the Central position (2005) as the assembler of that region; thence to export finished products to the US, Japan, EU countries, etc., as "export platform". While Japan abandoned the central role in the assembly and components production played in 1985 to keep components production with a higher added value and which more technology-intensive ("relocation of production"), increasing its FDI in the countries of the region:

 

 Here is expressed in a concentrated way the imperialism´s monopolistic character, parasitic and decaying. Character that is expressed more as more developed the imperialist country is. Imperialism is cancer, the more it develops the more the disease progresses. So, US imperialism is sinking more than the others, followed by everyone else.

THE DOMINANT INTERMEDIARY STATUS OF THE EXTERNAL SECTOR OF THE CHINESE ECONOMY

The intermediary character of Chinese exports, its dependence on FDI from the United States, Japan, etc., is shown in these notes and is most apparent in the following assessment:

"Koopman et al. (2008) showed that the share of foreign value added in Chinese manufactured exports is about 50%. Looking specifically at processing exports which benefit from duty exemptions on imported raw material and other inputs ‘as long they are used solely for export purposes’, this foreign share rises up to 82%. As a direct corollary of this, GVCs might also qualify the large trade (bilateral) imbalances between countries. For example, Kierzkowski and Chen (2010) have shown that taking into account the imports of parts and components by both countries reduced the large US deficit with China by approximately half, given that a lot of high value intermediates are exported from the United States to China"(68)

This is the relationship between exports and imports, what the bourgeois economists call the macroeconomic analysis. The same economist that, applying the analysis to the enterprise level, conclude:

"A micro-economic analysis of the international value chain of the iPod has clearly demonstrated the discrepancy between trade performance and value creation across countries (Linden et al., 2009). Using firm-level information, the analysis showed that China was merely specialized in the assembly of the imported intermediates into the final product which is typically generating relatively little value. The largest part of the value creation throughout the production process was done and captured by the producers of high value components (United States and Japan) and the seller of the iPod (Apple in the United States). The iPod example shows that the concept of competitiveness may sometimes need to be assessed at a detailed level, in order to fully understand what drives the international performance of countries."(69).

China is a capital exporter, has capital superabundance, part of which comes from its exports, and is an exporter of primary commodities, low technology and added value inputs and of assembled goods (maquila) and it´s an importer of capital (mainly in the form of FDI), energy, raw and especially high-tech inputs and added value machinery,  equipment and materials. We can say so as a corollary of all the material we've explained in these notes.

One way that the Chinese capital export takes is the purchase of foreign currency in dollars and other currencies through debt securities or bonds here is expressed in a concentrated way the parasitic nature of the Chinese social-imperialists, their dependence on FDI, of the exports and backwardness of its economy, as we read in the following quote:

"(...) Many Asian countries consider that although they have an excess of savings today, they want to invest in foreign exchange reserves and so they do not have to deal with a sudden capital flight as something similar to what was experienced in the 1990s crisis.

The excess savings in China is partly the result of China's exchange rate policy. Buying large amounts of dollars serves to maintain a weak national currency, promotes exports and reduce domestic spending. The result is a high level of net national saving, much of which ends up in the central bank's foreign reserves. The US, Britain and other deficit countries have shown a high appetite for cheap credit from abroad.

All countries that produce manufactured goods as China, or oil or metals, have excess savings, which has led them to seek ways of safe and liquid investment abroad, due that the national financial instruments are neither large nor sufficiently developed to absorb such large amounts of excess savings "(70).

And its dependence on imported capital and high technological value is goods gets well illustrated in its trade with the developed imperialist countries (71), as illustrated by its trade with Germany in the following quote:

"Among more distant trading partners, China has not only become an important source of many inputs but also a large customer of German exports of products and services and which accounted for about 5 percent of total German exports in 2009. The reasoning for this follows that of traditional comparative advantages and patterns of specialization; China demands goods like capital-intensive and research-intensive machinery and equipment in which Germany has a comparative advantage."

Lenin said about it:

“The extent to which monopolist capital has intensified all the contradictions of capitalism is generally known. It is sufficient to mention the high cost of living and the tyranny of the cartels. This intensification of contradictions constitutes the most powerful driving force of the transitional period of history, which began from the time of the final victory of world finance capital Monopolies, oligarchy, the striving for domination and not for freedom, the exploitation of an increasing number of small or weak nations by a handful of the richest or most powerful nations — all these have given birth to those distinctive characteristics of imperialism which compel us to define it as parasitic or decaying capitalism. More and more prominently there emerges, as one of the tendencies of imperialism, the creation of the "rentier state", the usurer state, in which the bourgeoisie to an ever-increasing degree lives on the proceeds of capital exports and by "clipping coupons". It would be a mistake to believe that this tendency to decay precludes the rapid growth of capitalism. It does not. In the epoch of imperialism, certain branches of industry, certain strata of the bourgeoisie and certain countries betray, to a greater or lesser degree, now one and now another of these tendencies. On the whole, capitalism is growing far more rapidly than before; but this growth is not only becoming more and more uneven in general, its unevenness also manifests itself, in particular, in the decay of the countries which are richest in capital (Britain). (...) On the other hand, a comparison of, say, the republican American bourgeoisie with the monarchist Japanese or German bourgeoisie shows that the most pronounced political distinction diminishes to an extreme degree in the epoch of imperialism — not because it is unimportant in general, but because in all these cases we are talking about a bourgeoisie which has definite features of parasitism.”(72).

The "dependence” relations are relations of subordination, domination and violence as well defined by Lenin. We also showed that it was stupid to attempt to separate the "real economy" from the speculation.

POLITICS IS CONCENTRATED EXPRESSION OF THE ECONOMY

All of the explained above is very important to correctly set the proper place of China in the world economy; as well, to see the weight or power of China, that as an imperialist country, confers its "extraordinary progress" as the world's largest exporter and especially in our case, seeing its weight in South America, where China is evolving into the most important "trading partner".

Based on the facts, we can apply correctly the great truth established by Lenin, that "politics is the concentrated expression of economics". And from there, establish the political significance for the world and for Latin America, in particular the "greater integration of China into the global production networks", ie of the Chinese companies, whatever their degree of association with the imperialist foreign capital is, as part of the combined or "mixed" monopolies (like links or nodes, of what they call the "chains of vertical integration of production" or "global production networks"), vertically integrated monopolies at the international level:

“This transformation of competition into monopoly is one of the most important — if not the most important — phenomena of modern capitalist economy, a very important feature of capitalism in its highest stage of development is so-called combination of production, that is to say, the grouping in a single enterprise of different branches of industry, which either represent the consecutive stages in the processing of raw materials (…) or in different branches that play an auxiliary role to another (for example, the utilization of scrap, or of by-products, the manufacture of packing materials, etc.). (…) From here it is a gigantic process of socialization of production (...) the process of inventions and technical improvements. But the appropriation remains private (...) forced subordination of monopolistic associations. (...) And the main profit goes to the "geniuses" of financial machinations ... achieved this socialization, goes to benefit…speculators "(73).

In the case of China, who are these "geniuses" behind who manage from above all this "global supply chain value" or rather who are the big monopolists who act internationally? Mainly the handful of imperialist companies in the United States, Japan, Germany, England, France, Holland, etc., who are at the head of those investments, which handle FDI in that region of the world and in China, then comes the social-imperialists Chinese and the handful of bureaucratic capital big bourgeois in these Southeast Asian countries .

THE CONCRETE WAY TAKEN BY THAT "FORCED SUBORDINATION" OF THE ECONOMY

To make perfectly clear how this forced subordination of the foreign capital related Chinese enterprises is, as links in the chains of the greatest Yankees Japanese, German, English, French, etc. monopolists, we will consign below the concluding observations of the Australian university study:

“Concluding Remarks:

There is clear evidence that the fragmentation-based specialization has become an integral part of the economic landscape of Southeast Asia and in the wider East Asian region. Trade in components has been expanding more rapidly than conventional final-good trade. The degree of dependence on this new form of international specialization is proportionately larger in East Asia, in particular in Southeast Asia, compared to North America and Europe. A notable recent development in international fragmentation of production in the region has been the rapid integration of China into the regional production networks. This development is an important counterpoint to the popular belief that China’s global integration would crowd out other countries’ opportunities for international specialization. China’s imports of components from countries in Southeast Asia and other developing East Asia countries have grown rapidly, in line with rapid expansion of manufacturing exports from China to extra-regional markets, mostly to North America and the European Union. Booming component exports from Southeast Asia to China, however, does not mean that the process has contributed to lessening the regions dependence on the global economy. On the contrary, the region’s growth dynamism based on vertical specialization depends inexorably on China’s extra-regional trade in final good, and this dependence has in fact increased over the years."(74).

To enable the reader to learn more of the history of the previous concluding observations, we recommend reading Table 6 (6th and 6b) and comments of that study (75) concerning: the "relative performance in the world machinery trade and trends and patterns of China´s bilateral trade in this product category "; on the "structural shift in Chinese exports" and "differences in geographic patterns of imports and exports ... China as a final product assembler for advanced countries markets using parts and components procured from countries in the region. "

That growth based on exploitation of the workforce, of the class, with the so called "labor intensive” use and, therefore, a low growth of the social productive forces, that the bourgeois economics say "intensive labor usage and low growth rate of potential gross domestic product " is one of the characteristics of bureaucratic capitalism. To see this also in China, which despite being an imperialist country, its level of capitalist development of the productive forces does not reach the US and the other imperialist countries, which are ahead in that uneven development; therefore the external sector of China is increasingly more dependent on FDI, only in special areas there are 40 million workers directly exposed to exploitation of this financial capital through their monopolies settled there.

Why did the imperialist investment or FDI into China leave to the extent registered in the recent years?

Because that labor was even cheaper than in the Philippines and many other Southeast Asia countries, much lower than Mexico and the Eastern Europe countries, and this is changing and is one of the reasons why the "model " has gotten into trouble and is being "reformed "; another reason is because of the good conditions and assurances offered by that social-imperialist country to FDI; and thirdly, it is to position itself in this "new market" that appeared with the restoration and especially because it is a "huge potential market", that means it still is not, because despite the immense mass of current population, its solvent consumption ability is reduced, that allows us to see that revisionism can never meet the needs of the masses and the revolutionary power in development is the main thing to consider and ultimately it will derail all social-imperialist dreams of becoming a superpower and will end up doing the anti-restoration to continue the dictatorship of the proletariat and the socialist revolution.

MAIN TREND IS THE REVOLUTION

The revolution is the main trend, which is opposed to the another trend; which says that in 2030 China will reach the United States or that in 2050 China will have surpassed it, etc. This latest trend is the only one referred to by those economists of some investment banks and all opportunists like the two ROLs in Peru, trying to beautify the system and hide or ignore the increasingly acute contradictions of imperialism, driving the development of the revolutionary situation in the world and all it means for the development of the subjective forces of the world revolution, to initiate and develop people's wars. In China, as was established by Chairman Mao himself, the counter-restoration will also be done with People's War (universality of the People's War).

All this leads us to see how US imperialism exerts its hegemony and sinks quicker than others; shows greater parasitism, as expressed in the deficit, in different economic levels; and how it finances it, subtracting each month more economic production means of production worldwide for clipping coupons, for more parasitism.

US imperialism seizes increasingly, by legitimate and illegitimate means, what is produced by others and feeds the financial game, speculation, through the increase of its debt and treasury bonds, debt of its enterprises through the highest stock market speculation and household debt through the "easy credit", which is then packaged as "new financial products" and thrown to speculation.

The collapse of imperialism increases its need of war to maintain its domination over the vast majority of countries on Earth, trying to escape its final crisis, so it sinks again, in a complex system of wars of all kinds; extra economic factors domination, political, military, cultural, etc., to try to escape their collapse and inevitably sweeping away, they are increasingly reactionary and violent. Therefore, the final sweeping away of imperialism can only be finished up with the people's war worldwide. 

The imperialist and reactionary propaganda through revisionists, opportunists, Trotskyists, etc. seeks to throw dust in the eyes of the masses; all of them endlessly repeat what their imperialist masters dictate, using the Chinese case. That is why it’s so important to properly characterize China as social-imperialist country, ie imperialist, with a deformed development by revisionism and that exhibits weaknesses  and backwardness in their economic development compared to the US, Japan, Germany, France, England, etc., which is expressed clearly in the external sector of the economy, the economic policy pursued by the Chinese revisionists in their country and its imperialist policy is intended as a "soft power"; as a "soft" in foreign policy, in collusion and conflict with the sole hegemonic superpower, Yankee imperialism, and the rest of the imperialist powers, including the atomic superpower, Russia, and that because of their deformation have to invest in Treasuries debt and other imperialist countries and in the Third World. As an Annex, we consign the assessment of the military forces situation in Asia, extracted from an imperialism source, but it serves to get an idea about it.

When properly characterizing China, we made the clear difference with the countries of bureaucratic capitalism and their businesses and capital and subordinate place in the world, over which China, as an imperialist country, keeps oppressed and subjected to the most savage and vicious exploitation, as is clear for everyone, for example, in Asia, Africa and Latin America.

We reaffirm ourselves in what was established in the CPP International Line, in which the historical trend and main policy in the world today, is revolution. That in today's world there are the three fundamental contradictions, of which the main one is between superpowers and imperialist powers, on the one hand and oppressed countries, on the other.  Oppressed or Third World countries are the foundation of the world revolution; we are in the stage of the collapse of imperialism and its sweeping away, of the world proletarian revolution, i.e. at the stage of strategic offensive of the world revolution and the imperialist strategic defensive that began around the 80; that at the present the new great wave of world proletarian revolution unfolds, where the war of imperialist aggression pushes revolution.

Everywhere in the world people are rising up against imperialism and world reaction, rejecting and crushing revisionism and opportunism. But the successful development of this new great wave requires us, communists, to finish the delayed task ahead of the constitution or reconstitution of the Communist Parties, as Marxist-Leninist-Maoist parties, mainly Maoist, militarized to initiate and direct the new people’s wars or transform existing armed resistance struggles in Maoist people's war.

To see the anatomy of the global situation, to see the role of the superpowers and powers, how the inter-imperialist contradictions develop and its collusion and contention for new world division, which is promoting the development of the main contradiction. We saw how the US hegemony is and, above all, how the process of its sinking is given amid the general collapse process of the world imperialist system. The collusion and conflict for a new world division. How the powers contend to advance to superpowers and fight for world hegemony slithering away the sole hegemonic power. 

The dream of the Chinese social-imperialist is precisely to turn China into a superpower to move towards world hegemony. We say that while this is a trend of development, the Chinese revisionists will inevitably sink. That the main trend in China and the rest of the world is revolution. Therefore, it behooves us wherever we are, to serve the reconstitution of the parties and in our case the general reorganization of PCP, crushing revisionism, to continue the victorious development of people's war to complete the democratic revolution in service of the world revolution.

AND

(To be continued) 

____________________________

 

Notes to the notes:

59. "Global Value Chain ..." p. 51

60. "Global Value Chain ..." p. 52

61. "Global Value Chain ...", "Causes of the international fragmentation of production, some evidence" Hillberry, Melbourne, p. 99.

62. "Global Value Chain ...", "International Comparative Evidence of Global Value Chain, De Backer and Yamano, p. 114.

63. OECD (2013), Economic Outlook for Southeast Asia, China and India 2014: Beyond the Middle-Income Trap, OECD Publishing. http://dx.doi.org/10.1787/saeo-2014-en.

64. Los capitalismos emergentes en la nueva arquitectura internacional, ¿qué hay de nuevo en la división internacional del trabajo?, Palazuelos, A, Revista del Este, Universidad Complutense de Madrid), 2007, nota a pie de página n° 17.

65. Dr.Danae Duana Avila de la Universidad Autónoma del Estado de Hidalgo y M. E. Nidia López Lira de la  U.A. del Estado de México, “La Ventaja Nacional de México y China en el siglo XXI”, pág. 4, 2003.

66.Prema-chandra Athukorala 27. or. Cit., P. 23.

67. Trade Patterns and Global Value Chains in East Asia IDE-JETRO © and World Trade Organization, 2011, www.ide.go.jp/English. We recommend reading it in full, because they are there exposed with illustrations data and facts that have been highlighted in other studies: The evolution of regional production network from 1985 to 2005.

68. International Comparative Evidence on Global Value Chains, Koen De Backer and Norihiko Yamano, OECD, Directorate for Science, Technology and Industry, Trade Policy Research, Canada, 2011, p. 122.

69. "Global Value Chains ..." p. 122.

70. Korean Economy in Transition Toward an Advanced Economy: Prospects and Challenges by Choong Yong Ahn and Kyttack Hong, p. 111 et seq

71. "Global Value Chains ..., The Role of Global Value Chains for German Manufacturing" Godart and Gorg, p 362.

72. Lenin, op. Cit., P. 84.

73. Lenin, op. Cit. P. 18.

74. Prema-chandra Athukorala 35. or. Cit., P. 23

75. Prema-chandra Athukorala 36. or. Cit., Australian National University College of Asia and the Pacific, p. 10 and ss.

ANNEX 1

HOW CHINA SEES AMERICA

THE SUM OF BEIJINGP´S FEARS

By Andrew J Nathan and Andrew Scobell, China's Search for Security (Columbia University

U.S. military forces are globally deployed and technologically advanced, with massive concentrations of firepower all around the Chinese rim. The U.S. Pacific Command (PACOM) is the largest of the United States' six regional combatant commands in terms of its geographic scope and non wartime manpower. PACOM's assets include about 325,000 military and civilian personnel, along with some 180 ships and 1,900 aircraft. To the west, PACOM gives way to the U.S. Central Command (CENTCOM), which is responsible for an area stretching from Central Asia to Egypt. Before September 11, 2001, CENTCOM had no forces stationed directly on China's borders except for its training and supply missions in Pakistan. But with the beginning of the "war on terror," CENTCOM placed tens of thousands of troops in Afghanistan and gained extended access to an air base in Kyrgyzstan.

The operational capabilities of U.S. forces in the Asia-Pacific are magnified by bilateral defense treaties with Australia, Japan, New Zealand, the Philippines, and South Korea and cooperative arrangements with other partners. And to top it off, the United States possesses some 5,200 nuclear warheads deployed in an invulnerable sea, land, and air triad. Taken together, this U.S. defense posture creates what Qian Wenrong of the Xinhua News Agency's Research Center for International Issue Studies has called a "strategic ring of encirclement."

Chinese security analysts also take note of the United States' extensive capability to damage Chinese economic interests. And the United States is one of China's largest sources of foreign direct investment and advanced technology….most-favored-nation…China has not earned a voice equal to that of the United States in a hypothetical Pacific Community or a role in a global condominium as one member of a "G-2." China will not rule the world unless the United States withdraws from it, and China's rise will be a threat to the United States and the world only if Washington allows it to become one... America can handle the rise of China while attendin