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By Root 1169 0

visiting the country during this period, there are more examples and images of change than one can recount. Fifteen years ago, when I first went to Shanghai, Pudong, in the east of the city, was undeveloped countryside. Today, it is the city’s financial district, densely studded with towers of glass and steel and lit like a Christmas tree every night. It is eight times the size of London’s new financial district, Canary Wharf, and only slightly smaller than the entire city of Chicago. The city of Chongqing, meanwhile, actually patterns itself after Chicago, which was the world’s fastest-growing city a hundred years ago. Chongqing, which is expanding every year by 300,000 people, would probably get that designation today. And Chongqing is just the head of a pack; the twenty fastest-growing cities in the world are all in China.

Despite Shanghai’s appeal to Westerners, Beijing remains the seat of Chinese politics, culture, and art, and even its economy. The city is being remade to an extent unprecedented in history. (The closest comparison is Haussmann’s makeover of Paris in the nineteenth century.) Largely in preparation for the 2008 Olympics, Beijing built six new subway lines, a 43-kilometer light-rail system, a new airport terminal (the world’s largest, of course), 25 million square meters of new property, a 125-kilometer “green belt,” and a 12-square-kilometer Olympic Park. When looking at the models of a new Beijing, one inevitably thinks of Albert Speer’s grandiose plans for postwar Berlin, drawn up in the 1940s; in fact, Albert Speer Jr., the son, also an architect, designed the 8-kilometer boulevard that runs from the Forbidden Palace to the Olympic Park. He sees no real comparison between the transformation of Beijing and his father’s designs for Hitler. This is “bigger,” he says. “Much bigger.”2

Every businessman these days has a dazzling statistic about China, meant to stun the listener into silence. And they are impressive numbers—most of which will be obsolete by the time you read them. China is the world’s largest producer of coal, steel, and cement. It is the largest cell phone market in the world. It had 28 billion square feet of space under construction in 2005, more than five times as much as in America. Its exports to the United States have grown by 260 percent over the past ten years. At the height of the industrial revolution, Britain was called “the workshop of the world.” That title belongs to China today. It manufactures two-thirds of the world’s photocopiers, microwave ovens, DVD players, and shoes.

To get a sense of how completely China dominates low-cost manufacturing, take a look at Walmart. Walmart is one of the world’s largest corporations. Its revenues are nearly seven times those of Microsoft and account for roughly 2 percent of America’s GDP. It employs 2.1 million people, more than GM, Ford, GE, and IBM put together. It is legendary for its efficient—some would say ruthless—efforts to get the lowest price possible for its customers. To that end, it has adeptly used technology, managerial innovation, and, perhaps most significantly, low-cost manufacturers. Walmart imports about $27 billion worth of goods from China each year. The vast majority of its foreign suppliers are there. Walmart’s global supply chain is really a China supply chain.

China has also pursued a distinctly open trade and investment policy. For this among many reasons, it is not the new Japan. Beijing has not adopted the Japanese (or South Korean) path of development, which was an export-led strategy that kept the domestic market and society closed. Instead, China opened itself up to the world. (It did this partly because it had no choice, since it lacked the domestic savings of Japan or South Korea.) Now China’s trade-to-GDP ratio is 70 percent, which makes it one of the most open economies in the world. Procter & Gamble sells $5 billion worth of products a year in China, and familiar products like Head & Shoulders shampoo and Pampers diapers are extraordinarily popular with consumers there. Starbucks is opening thousands