Wal-Mart increases its hold on China

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: China is the largest exporter to the US in virtually all consumer goods category and Wal-Mart is the leading retailer of consumer goods in the US. So uncanny and strong is the mutual dependency between China and Wal-Mart that they have been called as the “ultimate joint venture” by some. Wal-Mart’s dramatic rise in overseas production and sourcing was a result of landmark changes in public and global trade policies supported by bipartisan consensus for the last 25 years.

Wal-Mart has reached such levels of sophistication in its international sourcing that it is always one step ahead of its competitor in either new product development or sourcing the same product for a nickel less and thereby doing justice to its motto of “everyday low prices”. The impact of the rise of Wal-Mart on other US-based retailers and manufacturers bears striking resemblance to the impact of the rise of China as a manufacturing force on other Asian manufacturing-exporting countries.

Few went out of business and others had to find a way to survive within the realms of the new eco-system. The rest had to be content with the focus on niche products at the cost of growth. A month ago, Wal-Mart celebrated the approval of its 100th store in China, since it entered the Chinese market in 1996, with the presence of secretary Carlos Guitierrez from the US department of commerce and vice minister Jian Zengwei from China’s ministry of commerce. Coinciding with the celebrations in Beijing marked the opening of the new Wal-Mart super-centre in Loudi in Hunan province.