There are a number of economic variables Microsoft must consider in assessing the viability of importing software into China. These variables include the growth rate of the Chinese economy, the stability of the world economy, growth in the computer industry specifically, and the cost of such problems as piracy and tariffs.
The year 1996 in China was the "Year of the Rat," a particularly auspicious sign in traditional Chinese culture. It was also the year when China launched its next Five Year Plan aimed at modernizing the infrastructure. American companies are involved in this process in the construction of power plants, telecommunications systems, ports, railroads, airports, and light rail transit, with the support of the U.S. Government. In 1995 on the occasion of Secretary Ronald Brown's visit, the U.S. China Joint Commission on Commerce and Trade (JCCT) established a Steering Group whose job is to identify viable infrastructure projects in which U.S. exporters can participate (Martin, 1996, 11).
The view of the economy held by Microsoft is of assured growth, and they have the figures to prove it. North America still accounts for the single largest portion of Microsoft's sales, but global markets are catching up thanks to explosive growth. Some individual countries, like China, are expanding by 100%. The nature of the growth can be ascertained from the following chart showing growth for the company:
Japan, South Korea, China, Hong Kong, and Taiwan
Latin America, Southeast Asia, India, Australia and New Zealand, the Middle East, Greece, and Turkey
[2] Does not include $3.47 billion of software sold directly to computer manufacturers.
The computer market in China has been increasing at a tremendous rate. The huge population is one reason why this remains an important target market for all hardware and software
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