TRAVEL by ferry from Hong Kong to Shenzhen, in one of the regions that makes China the workshop of the world, and an enormous billboard greets you: “Time is Money, Efficiency is Life”.China is the world’s largest manufacturing power. Its output of televisions, smartphones, steel pipes and other things you can drop on your foot surpassed America’s in 2010. China now accounts for a fifth of global manufacturing. Its factories have made so much, so cheaply that they have curbed inflation in many of its trading partners. But the era of cheap China may be drawing to a close.

Costs are soaring, starting in the coastal provinces where factories have historically clustered (see map). Increases in land prices, environmental and safety regulations and taxes all play a part. The biggest factor, though, is labour.On March 5th Standard Chartered, an investment bank,…

NOT long after Steve Jobs died last year, wags eulogised the Apple co-founder with a joke: “Ten years ago we had Steve Jobs, Bob Hope and Johnny Cash. Now we have no jobs, no hope and no cash.” Apple may no longer have Jobs, but it fills investors with hope and is brimming with cash. Its market capitalisation recently passed $500 billion, and it has a whopping $100 billion or so of cash on its balance-sheet.That mountain of money is about to get higher. Apple aficionados are poised to snap up the new gadgets that the company unveiled on March 7th. These include a new iPad, the latest in the firm’s wildly popular range of tablet computers, and a revamped Apple TV device.If the new iPad, which boasts a super-sharp screen and lightning-fast connectivity, wins friendly reviews, it will give a big boost to Tim Cook, Jobs’s handpicked successor. But the extra cash it delivers will also increase pressure on Apple’s boss and board to explain what they plan to do with the company’s embarrassment of riches. Last month Mr Cook admitted that the firm has more cash than it needs for its operations. It’s a nice problem to have.The obvious solution would be to give cash back to shareholders, either via dividends or share buybacks. This is a surprisingly sensitive subject. Mr Jobs was obsessed with hoarding cash, not least because of Apple’s near-bankruptcy in the mid-1990s. Returning…

Her other firm provides security for wigs

LADY GAGA’S business manager, Troy Carter, will judge an eight-hour hackathon at the SXSW festival in Austin, Texas, on March 11th. Geeks will vie to create new ideas to do with digital music distribution. The event will be hosted by Backplane, a tech start-up co-founded by Mr Carter, which has just launched its first product, a web community for Lady Gaga called LittleMonsters.com (after the pop star’s pet name for her fans).The goal is to create a one-stop shop for everything Gaga. Fans will be able to download her music, buy tickets for her shows and chat with each other (and even, perhaps, with the singer herself). It will feature “social ticketing”, which will make it easy for fans to find concert seats near their friends and even start conversations beforehand with strangers they will be sitting with. Translation software will allow fans without a language in common to chat about changing the world one sequin at a time.For now, LittleMonsters is by invitation only (just 10,000 “super fans” have been chosen from around 1m applicants) but it…

One careful owner?

TIMES may be tough, but women still need little black dresses to wear to posh parties. So some buy a fancy frock, dance the night away in it and then return it to the store, pretending that it does not fit. To ensure a refund, they may even unpick a seam and complain that the garment is faulty. This is an example of a growing problem. Retailers call it “de-shopping”.Return fraud, which also includes such things as selling shoplifted goods back to the store from which they were pinched, is becoming more widespread. It cost American retailers $14.4 billion in 2011, according to the National Retail Federation, up from $9.4 billion in 2009. The worst offenders are women returning clothes.Online stores are particularly vulnerable. Few people will risk buying something to wear without trying it on first, so cyber-retailers need to have generous returns policies. But other scams are gaining popularity, too. Electrical retailers say that some sports fans now “borrow” large high-definition televisions to watch big matches.De-shoppers are becoming more organised, says Tamira…

A LUXURY handbag by Stella McCartney worth £600 ($960) is the prize in an online game to design the best virtual outfit featuring the accessory, using real items on sale in Matches, a real store. Players of a game created by Fantasy Shopper will pick the winner. The firm is a pioneer of “relevant social gaming”. This combines features of online games such as FarmVille and World of Warcraft with data and deeds from the real world.“Gamification” is an ugly word, but it sounds like money to some. Online games are fun. Why not borrow some of that fun and apply it to real life? This can be hard. Plenty of firms have flopped by trying to bolt a gaming element unconvincingly onto a boring pre-existing website. Fantasy Shopper was designed from the start as a hybrid between game and real-world activity says its founder, Chris Prescott.Players visit a city (London for now, New York and others to follow) and compete to find bargains and assemble the best outfits using virtual money to spend on goods actually sold in shops there. The choices can be published on Facebook news feeds, where other players vote on the looks on offer. Besides the occasional shot at winning an expensive handbag, players are rewarded virtually, with badges and the like to show off to friends, and vouchers they can use at real shops.Mr Prescott reckons that Fantasy Shopper will appeal to those who shop as much…

THE lab-on-a-chip (LOC) is a small device with a huge potential. It can run dozens of diagnostic tests on human DNA in a few minutes. Give the device a gob of spit or a drop of blood and it will tell you whether or not you are sick without any need to send your DNA to a laboratory. In poor countries LOCs could offer diagnostics to millions who lack access to expensive laboratories. In the rich world they may curb rising medical costs.The world has been so dogged by bad news of late that it is almost possible to forget about tiny miracles like the LOC. But two timely new books remind us that boffins continue to make the world a better place even as politicians strive to do the opposite. Peter Diamandis and Steven Kotler make a breezy case for optimism in “Abundance: The Future is Better Than You Think”. Eric Topol provides a more considered look at why medicine is about to be “Schumpeterised” (his word) by digital technology. These books are a godsend for those who suffer from Armageddon fatigue. They also remind us that technology keeps improving despite economic gloom.Messrs Diamandis and Kotler argue that the…

UNTIL liberalisation in 1991, the travel schedules of Indian executives often revolved around treks to Delhi to beg officials for access to hard currency and permission to import equipment. These days the country’s corporate warriors talk of being on the road in Africa for three weeks of every month, of trips to factories in Wales, of meeting the troops in South Korea and of crossing America to talk to car-dealers.The rapid globalisation of Indian firms owes much to takeovers. Cross-border deals worth $129 billion over the past decade include monsters such as Bharti Airtel’s purchase of the African assets of Zain, a mobile-telecoms firm, and the Tata Group’s purchases of Corus, a steelmaker, and Jaguar Land Rover (JLR), a carmaker. Those deals thrilled Indian patriots and transformed the reputation of Indian firms abroad. Some cheerleaders even suggested that shrewd Indian companies, thanks to their willingness to invest for the long term, might defy the first rule of corporate finance: that takeovers routinely destroy value for the purchaser.

“IT DOESN’T happen every day that a country of 60m people in the most dynamic region of the world is suddenly open for business,” argues Hans Vriens, a consultant in Singapore. He is describing the prospects in Myanmar, as the once isolated country moves from a military dictatorship to something less ghastly.Rich in teak, minerals, oil, gas and much else, half a century ago Myanmar was one of the more prosperous countries in the region. Decades of state socialism, oppression and sanctions put paid to that. But now Myanmar seems to be rejoining the real world. The army has relaxed its grip somewhat, and the government is angling for foreign investment. Will the economy regain its former lustre?Myanmar’s reforms may win diplomatic rewards. America and the European Union imposed sweeping economic sanctions in the 1990s to punish the regime for stealing elections and jailing opponents. These may be lifted. That would allow foreign firms, and particularly Western ones, to pour in. Some countries are moving already. America is allowing IMF and World Bank teams to visit the country in part to help the government modernise its sclerotic financial system. The EU has abolished visa restrictions on leading government members and is expected to announce further relaxations in April.Western firms are excited by the country’s big population, abundant natural resources and palpable demand…

Hands-free KITT

IT WILL be some years before cars are as smart as KITT, the talking, self-piloting car in the 1980s TV show “Knight Rider”. Several carmakers, and Google, are doing trials of self-driving cars, and Nevada has become the first American state to pass a law to regulate such trials on public roads.Already, however, cars are increasingly coming with features that help drivers with steering and braking and, in some cases, overrule their human operators to prevent crashes. This week Ford’s chairman, Bill Ford, said carmakers needed to press ahead with autonomous vehicles. He is convinced that they will ease traffic jams. And the same sorts of automation that can squeeze more cars on to the roads can also cut accidents (themselves a big cause of congestion).Volvo’s new V40 small hatchback essentially drives itself in busy traffic, maintaining a safe distance and keeping in lane without human intervention. The V40 also brakes automatically when it senses an imminent collision, as can Ford’s new B-Max minivan. Such features appeared on some pricey vehicles a few years ago, but…

Free to be geeks

WHERE did BarCamp, a get-together of tech geeks (pictured), recently hold its biggest event since its founding in Silicon Valley seven years ago? Not San José, nor Bangalore, nor even Singapore. On February 11th more than 5,000 developers and bloggers gathered in Yangon, the main city of Myanmar, one of the world’s most tech-starved places. The star speaker was the country’s opposition leader, Aung San Suu Kyi.Myanmar’s government continues to surprise the world with its new-found tolerance for change. Its apparent willingness to nurture a fledgling IT sector is no exception. Myanmar has lowered its firewalls, opening access to social-media sites such as Facebook and Twitter. People can read international newspapers online or chat with family abroad via Skype. Sponsors of BarCamp included the telecommunications ministry.Though the government now acknowledges the importance of an IT industry for economic development, much work remains. Few people in Myanmar own computers and only a handful can afford the sort of connectivity that is commonplace elsewhere. Setting up an…

WHETHER James Murdoch can ever succeed his father, Rupert, at the helm of News Corporation after resigning on February 29th as head of its scandal-ridden newspaper arm, News International, is not clear. The firm, of course, is depicting the change as almost trivial: he will still be deputy chief operating officer of News Corp and overseer of its international businesses, and it was first announced nearly a year ago that he would move to New York.In theory he can now make a fresh start: one of his main responsibilities will be pay television, a business in which he did well before taking over the newspapers in 2007, the move that marked him as heir apparent. And he will be insulated from the poisonous atmosphere in London, where it was confirmed this week that the victims of phone-hacking by News of the World (NOW) journalists included none other than Mr Murdoch’s disgraced former sidekick, Rebekah Brooks, who at the time was editor of NOW’s stablemate, the Sun.All the same, James Murdoch will be remembered as the man who closed Britain’s biggest Sunday paper and claimed not to have known how deep the rot was despite warnings from underlings. When Rupert Murdoch appeared in London in February to launch the Sun on Sunday, it was without James but with his elder son, Lachlan, prompting speculation that the…

“A LAZY bastard living in a suit” is Leonard Cohen’s description of himself in his new album, “Old Ideas”. Mr Cohen is certainly fond of wearing a suit, on and off stage. But lazy seems a bit harsh. He is 77, which is 12 years beyond the normal retirement age in Canada, where he was born. But there is no sign of his laying down his guitar. He spent 2008-10 on tour, performing on stage in Barcelona on his 75th birthday. “Old Ideas” has won widespread acclaim. Mr Cohen says he has written enough songs for another album.In the 1960s pop was a young person’s business. The Who hoped they died before they got old. Bob Dylan berated middle-aged squares like Mr Jones in “Ballad of a Thin Man”. But today age is no barrier to success. The Rolling Stones are still touring in their 60s. Bob Dylan’s songwriting skills, if not his vocal chords, have survived intact. Sir Paul McCartney warbles on.It is time to do for enterprise what such ageing rockers have done for pop music: explode the myth that it is a monopoly of the young. This idea has been powerfully reinforced by the latest tech boom: Facebook, Google and Groupon were…

OBESITY is an epidemic to some and an opportunity to others. More than two-thirds of Americans are overweight. Find a way to battle the bulge and a huge profit might be made. On February 22nd one pharmaceutical firm, Vivus, took a small step towards this goal. A committee advising America’s Food and Drug Administration (FDA) recommended that it approve Vivus’s diet drug, Qnexa. However, the pill’s long-awaited final approval may not come until April, if at all. The announcement mostly served as a reminder of what a struggle it is to turn fat into gold.Pharmaceutical and medical-device companies are quite good at treating the conditions that come with obesity. However, they are dismal at helping consumers lose weight. This is not for lack of trying. Take the curious case of the gastric band. Bariatric surgery can lead to weight loss in the long term. Hospitals can make money from all bariatric procedures, including gastric bypasses (in which the stomach is partitioned and the upper part connected directly to the small intestine), but the gastric band is a rare example of an opportunity for device-makers to profit from weight loss. Allergan, best known for selling Botox, has tried to use its Lap-Band to tap the obesity market. It is an inflatable loop which the surgeon fits near the top of the stomach, which helps the patient feel sated earlier.Allergan has captured about 70…

SHAREHOLDERS can be such nuisances. This week the Alibaba group, China’s biggest internet firm, announced that it wants to delist the shares of Alibaba.com, its business-to-business arm, that are traded on the Hong Kong stock exchange. The company, and its founder and chairman, Jack Ma, made no attempt to sugar-coat the decision.One big motivation for delisting, the parent company said, is to have the freedom to run its offshoot “free from the pressure of market expectations, earnings visibility and share price fluctuations.” It also acknowledged that its slumping share price had been causing problems inside the company: “A depressed share price may continue to adversely impact…employee morale,” it said.

The deal, which will set Alibaba back $2.3 billion, looks likely to succeed. One reason to think so is the hefty premium on offer. A bit over a quarter of Alibaba.com’s shares are publicly traded, and the firm is buying out those unhappy investors for HK$13.50 ($1.74) per share. That matches the offer price of the firm’s initial public offering in 2007, and is roughly 46% higher than the last closing price two weeks…

Thrills and spills

LEGEND traces the origins of American stock-car racing back to Prohibition. Moonshiners modified their cars, the better to outrun police on the south-east’s narrow, winding roads. Though races today are on a track rather than mountain byways and drivers tend to be wholesome, media-friendly “brands”, not backwoods renegades, the sport still enjoys a rascally image. Contact between cars is expected: “Rubbin’ is racin’,” goes an old saying.Since the 1970s NASCAR (the National Association for Stock Car Auto Racing) has enjoyed a rapid rise. Its most popular races—of which the greatest, the Daytona 500, is held this weekend—draw more than 100,000 spectators. NASCAR has become the second most popular professional sport on television, until recently averaging more than 9m viewers a race, behind only (American) football, whereas audiences for professional basketball, baseball and ice hockey have shrunk.Until 2001 each track negotiated the broadcast rights for races individually. NASCAR then took over, selling packages to the big networks and thereby boosting the audience….

An imbroglio for Proglio

EVEN by the standards of French business, from which politics is rarely absent, it was an outrageous plan. This week news emerged of a plot to oust Antoine Frérot, chief executive of Veolia, a private water and waste group, and replace him with Jean-Louis Borloo, a politician and former energy minister. Civil servants regularly take the top job at blue-chip French firms. But Mr Borloo, who has no experience running a business, seemed singularly unqualified to run an unprofitable company which needs deep restructuring.Mr Borloo is a friend of Henri Proglio, who was Veolia’s chief executive from 2003 until 2009. Mr Proglio then handed the job to Mr Frérot, his chosen successor, and became chief executive of Electricité de France, a utility. For a year after becoming boss of EDF, Mr Proglio stayed on as Veolia’s chairman, collecting two big pay packages. After a corporate-governance storm, he stepped down as chairman of Veolia in 2010 but kept a seat on its board.The origin of this week’s row is Mr Frérot’s plan to restructure Veolia, one of France’s largest…

THE conference room resembles an old “Star Trek” set, with swivel chairs, laptops on desks and headsets that switch between Kinyarwanda and other tongues. Paul Kagame, Rwanda’s president, sits in the captain’s chair. His technocratic ministers sit nearby. When the talk turns to business, Mr Kagame becomes animated. It is his passion—he says he reads business case studies in bed. He wants to turn Rwanda into the Singapore of central Africa. He is nothing if not ambitious.Rwanda is best known for the genocide that claimed at least 500,000 lives in 1994. It has been peaceful since then, but lacks nearly all of Singapore’s advantages. Singapore has the world’s busiest port; Rwanda is landlocked. Singapore has one of the world’s best-educated populations; Rwanda’s middle class was butchered in 1994. Singapore is a gateway to China; Rwanda’s neighbours are “less than ideal”, as a recent report from the Legatum Institute, a British think-tank, put it. Uganda is corrupt; Burundi a basket-case; Congo worse.

Order online, pay cash in store

TERRY LUNDGREN and Kevin Ryan know and like each other. But when it comes to the future of retailing the boss of Macy’s, an American department-store giant, and the chief executive of Gilt Groupe, an online retailer, disagree wildly. Mr Lundgren remains a firm believer in an empire of bricks and mortar. Mr Ryan is betting big on online-only selling.“It used to be catalogues killing physical stores, then it was TV shopping and now it is online retail,” says Mr Lundgren. Although he will not be pinned down on whether the internet is a threat to shopkeepers or an opportunity for them, he is convinced that his chain is on the right path. Macy’s is embracing “omnichannel” integration, that is, selling stuff on television, through mail-order catalogues and online, as well as keeping its department stores. The company runs 810 shops across America under the mid-price, mid-market Macy’s brand and 38 posher Bloomingdale’s outlets.

IS AMERICA fading? It seems an odd thing to say about a country that so dominates the industries of the future. Where else could Facebook have grown from a student prank to a $100 billion company in less than a decade? America has been gripped by worries about decline before, notably in the 1970s, only to roar back. But this time it may be serious.There is little doubt that other countries are catching up. Between 1999 and 2009 America’s share of world exports fell in almost every industry: by 36 percentage points in aerospace, nine in information technology, eight in communications equipment and three in cars. Some loss of market share is inevitable as China and other economies emerge. But even in absolute terms, there is cause for worry. Private-sector job growth has slowed dramatically, and come to a halt in industries that are exposed to global competition. Median annual income grew by an anaemic 2% between 1990 and 2010.The March issue of the Harvard Business Review is devoted to “American competitiveness” (by which it means the country’s ability to improve productivity and living…

Hindsight can be frustrating. We kick ourselves for not buying Apple shares ten years ago, when they were $12.50 each. On February 13th they rose above $500. So $100 invested in Apple in February 2002, around the time it unveiled its redesigned iMac, would be worth almost $4,000 today. The same investment in Sberbank, Russia’s biggest state-owned bank, would now be worth more than $3,700. But cheer up. We can at least be grateful that we didn’t buy shares in Allied Irish Banks or AIG. Bets of $100 in those firms ten years ago would now be worth $1.33 and $2.21 respectively. Western financial institutions have been by far the worst investment of the past decade. As for the next one, who knows? (Because this chart looks at the 200 biggest existing companies that also existed in 2002, it ignores both new and recently bankrupt firms.)