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China Briefings

Reports on China issued by Samsung Economic Research Institute

China Business Intelligence No. 136

China Business Intelligence No. 136

Samsung Economic Research Institute Beijing Office

Oct. 7, 2009

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I. Economy

With the global financial crisis in 2008 contracting exports and domestic consumption, the number of the unemployed in China increased. As of June 2009, however, China faced a labor shortage with improved economic conditions. This report analyzes the cause of the labor shortage and its effect on the Chinese economy. Securing an adequate level of labor has not been easy due to the return of migrant workers to rural areas as well as other seasonal factors. As the labor market contracted in early 2009, workers returned to their homes in rural areas, and the labor force in southeast coastal areas declined. Workers who migrated from rural areas to cities are the core labor force of the labor-intensive industry in China, but they are officially registered in rural areas because of the current family registration system.

II. Industry

A World Trade Organization (WTO) dispute panel upheld US complaints against China's restrictions on imports and sales of foreign audio-visual materials. The US filed a complaint to the WTO over China's restrictions on imports of audio-visual products. In April 2007, the US brought the case to the WTO, claiming that China, which imports and sells videos, books, films and Internet music mainly through official channels such as state-owned enterprises, violated the principle of national treatment, causing huge damages to the US industries.

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