South America, Here We Come
Next month Dr. Anne Reilly and I are accompanying a group of 16 Quinlan graduate students to Santiago, Chile as part of a study-abroad course. As we prepare for this, it becomes clear that one of our first conversations will involve the role of China. This may seem surprising at first, but our world economy is driven by an intertwined web of trade and race for resources.
In addition to much of the food we eat, South America has two resources that both the U.S. and China seek — oil and copper. The accessibility of and status associated with owning a car has now caught on in major Chinese cities. Shanghai and Beijing have added 1000 new cars a day to their streets for the past ten years. Thus China is in the position that we find ourselves — seeking oil and bidding for it in the world market. Their solution is to trade Chinese goods for these natural resources. You might think that this puts South America in a position of power. Yes, to a degree it does, but the lower-priced Chinese goods also undercut the prices of local goods, which strains in-country manufacturing.
World business is complicated, yet part of our lives. We look forward to introducing this to our graduate students and, in even greater depth, to our Intercontinental MBA students to next year. Meanwhile, South America, here we come.