Although reports give the impression of a large scale move in manufacturing capacity from the G7 countries to Eastern Europe and the Far East, where wages are lower, the reality is that the move has been much more gradual and less spectacular. As of end 2006, Western Europe, North America and Japan still accounted for 75% of world manufacturing output, with China accounting for 9%, up from 4% in 1996. The other trend has been for companies in developing nations to buy companies in the developed world.

In the sections below, we list some of the key statistics and developments for the two years prior to December 2007. To see how this fits into our global outlook, we refer you to our World overview. For more recent information, we suggest you refer to the MBendi Blog: Signposts to 2020.

A study by the European Foundation for the Improvement of Living and Working Conditions concluded Western Europe was losing manufacturing jobs to Eastern Europe.

In 2005, China had 118 million tons of excess steel capacity, more than Japan's total capacity. Chinese steel output increased 18.5% in 2006 to 418.8 million tons. In 2005 China consumed 31% of world's steel, 41% of iron ore, 35% of coal and 23% of refined copper. India accounts for 20% of Chinese iron ore imports. China's factory output in January and February 2007 was 18.5% higher than the first two months of 2006 which were in turn 16.2% higher than 2005. In December 2006, China announced measures to curb exports of steel products. China's steel exports rose 44% in 2005 and a further 92% on the first ten months of 2006 to 32.8 million tonnes. Steel production increased 25% in 2005 and 20% in 2006.

In November 2006, China's TCL announced plans to close the loss making operations in Europe it bought from Thomson in 2003, while Taiwan's BenQ also announced plans to close loss-making European operations bought from Siemens in 2005.

Footnote: If you are aware of any highlights we have missed, please contact us with details.