Post-Olympic Slump Will See Reallocation of Manufacturing IT Budgets

With the Beijing 2008 Olympics over, increased attention has been given to the aftereffects the event will have on the Chinese economy and, in particular, on the rapidly growing manufacturing sector. While other host countries such as South Korea (Seoul), Spain (Barcelona) and Australia (Sydney) saw a slowdown in economic growth after hosting the Olympics, the impact on Beijing and China is less clear-cut due to the country&#39;s status as an emerging economic superpower. <br /><br />According to analyst Datamonitor, after the Olympics have ended, China&#39;s manufacturing industry will continue to slow as the business outlook within the manufacturing industry darkens. <br /><br />In some respects, the Chinese economy has been slowing for some time now, with a marked increase in inflation one of the key indicators. Appropriately, the Chinese government made fighting inflation one of its top priorities for 2008, with somewhat less regard given to the impact on economic growth. This position has changed recently to mimic that of more developed countries, where strategies have been adopted to target sustainable growth while keeping inflation under control. <br /><br />The post-Olympic effect identified in the majority of the last 12 host economies will compound this slowdown. Indeed, economic growth in China is expected to drop from 11.4 percent in 2007 to less than 10 percent in 2008.<br /> <br />In the manufacturing sector, the demand for Chinese exports has waned in recent months as Western customers face the pressures of the global credit crunch, increased fuel and energy costs, and…



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