China makes simple stuff so far... or at least complicated stuff that we or Japan has done the R&D on.

China's conversion to a market economy only started in the late '70s, leaving them well behind in design and R&D. But they've already grown to become the world's 4th largest economy, largely driven by export earnings. Their enormous untapped local economy is as big as much of the Western World put together, creating potential for gigantic cashflows to drive R&D and homegrown high-value goods for export. For example, if China ramps up its local market so that "PCs in use per 1000 people" starts to approach the rates seen in the Western World, as many as eight hundred million PC sales might be anticipated in a relatively short period. By comparison, annual PC sales in the US are about 40 million.