"They are wrong to blame China and India for job losses because we didn't do our homework well. " says Klas Eklund, Chief economist in Swedish SEB bank.

Mr. Eklund made the remark at the on-going three day Globe Forum being held in Stockholm from 18-20 April.

The forum mainly discussed challenges and opportunities in the newly emerged economic entities such as China, India and eastern Europe.

In his speech, Eklund mainly talked about the new challenges for old labor markets such as Europe.

Eklund said that so far globalization has been mainly a win-win process. Trade and investments have boosted productivity and profits. New jobs have been created in countries like China and India, while real income has risen in Europe as consumers have benefited from inexpensive imports. This has caused demand for new jobs to increase, primarily in service sector.

Eklund argued that the reason why unemployment is high in Europe is not the rise of China and India per se, but rigid wages and lingering regulations, which create high thresholds for the creation of these new jobs. A more flexible labor market would mean more jobs in Europe.

He said most people assume that the challenge form Asia mainly comes in the form of low-cost jobs in industry. But this is incorrect. "Today, competition for jobs is not simply between companies or even sectors. More kinds of individual tasks can now be formed in another country, courtesy of new information technology."

He said not only physical products that can be put in boxes or containers are traded, but also information and bits. All companies irrespective of size or sector can offshore many different kinds of jobs which may involve industrial workers in manufacturing, but can also involve call centres, back offices, elements of auditing and analysis. Even some medical services such as X-ray can be performed over the internet.

However, Mr. Eklund divided jobs into personal services and impersonal services. The above-mentioned jobs can be categorized as impersonal services and can be off-shored. But personal services where one needs physical interaction such as transportation, the police, care of young and elderly, dental services and hairdressers cannot be off-shored.

Mr. Eklund warned that one cannot simply claim that high-skilled tasks are better protected from competition than low-skilled tasks. While economists previously used to talk about ��comparative advantage' as something rather slow changing, companies are now scanning the globe much more rapidly, searching for possible ways of lowering costs and increasing productivity by moving teams of employees or even individual tasks to new locations.

He said European countries cannot assume that the competition will come only from low-cost jobs. It will come in many shapes and forms and challenge many more tasks than people are used to.

He also warned against rising protectionism and resistance to globalization. He suggested that the European labor market must become much more flexible and it is also necessary to lower the thresholds for creating new jobs in Europe.

In the end he stressed that "they are wrong to blame China and India for job losses because we didn't do our homework well."

By People's Daily Online correspondent in Stockholm Xuefei Chen