Are you familiar with the concept of "predatory pricing"? In case you are not, it is a tactic where one competitor bleeds the other out of business by undercutting prices long enough to sink the competiton so he can jack up the prices once the competitor is bankrupt and monopoly is obtained.
The Chinese are manipulating their currency and are trying to become the world's manufacturing center. Once they obtain enough market share to manipulate the prices, they will do exactly that.
Personally, I think the supposed benefits of a true free market is a pipe dream, just like communism.