“Orders increased in March and April, but there is not much difference from the same period last year.” Many Canton Fair exhibitors told reporters. After nine months of sluggish foreign trade exports, export data rebounded sharply in March. But is this a short-term recovery or is the fundamental trend improving? Opinions vary from the industry to scholars. People from all walks of life are cautiously optimistic about the prospects of my country’s foreign trade development, and hope to improve the competitiveness of enterprises through transformation and innovation.
Industry experts said that the trade method that relied on low cost, low price, and low end to participate in the international division of labor in the past 35 years has ended. Under the new normal, we must rely on international competitiveness, talent, marketing, brand, quality, efficiency, etc. to participate in the international division of labor.
But experts believe that transformation cannot be concentrated in the high-end market. China’s biggest advantage is that we have sufficient diversified production capabilities. Companies should target different markets based on their own advantages.
Exports “rebounded” in March
On April 13, data from the General Administration of Customs showed that after nine months of negative growth, the total export value in March reached 1.05 trillion yuan in RMB, a year-on-year increase of 18.7% (over the same period last year); The total import value was 855.5 billion yuan, a year-on-year decrease of 1.7%. The decline narrowed compared with last month and was far better than market expectations.
Many opinions believe that the rebound in export data in March means that my country’s foreign trade situation has begun to pick up, and they say that these signs may be reflected in the spring Canton Fair. However, if the factors of the long Spring Festival holiday are excluded, this data may not be so optimistic.
According to data from the General Administration of Customs, after seasonal adjustment, export growth in March was only 0.9%. After excluding factors such as exchange rates, March export data may still be negative growth.
Ministry of Commerce spokesperson Shen Danyang said at the regular meeting of the Ministry of Commerce on the 12th that exports rebounded significantly in March, one due to seasonal factors and the other to base factors. The seasonal factor means that due to the Spring Festival in February, exports will either rush forward or be pushed back. The base factor refers to the fact that the monthly export volume in March last year was the lowest among all months of the year. Therefore, although exports in March this year increased by 18.7% year-on-year, “the export scale is only about 1 trillion yuan, and the figures are not ideal.” Shen Danyang emphasized, “Further investigation and analysis show that the foreign trade situation throughout the year is still complex, severe and not optimistic.”
Zhuang Rui, deputy dean of the School of International Economics at the University of International Business and Economics, told reporters: “Monthly data will be affected by certain factors, such as cyclical changes, previous bases, etc., so monthly data cannot be used to refer to annual data. Exports in March The data is a good sign, but it cannot fundamentally say that the trend of foreign trade is improving.”
The reporter interviewed many Canton Fair exhibitors and they all said that the order volume in March and April has rebounded, but it has only remained stable compared with the same period last year and there has been no significant growth. The signs that foreign trade is beginning to pick up do not seem to be confirmed from the corporate side.
When Zhong Shan, the international trade negotiator and vice minister of the Ministry of Commerce, visited enterprises at the Canton Fair, he repeatedly asked what difficulties the enterprises had in operating? Are they confident about the foreign trade situation in the second half of the year? Zhong Shan pointed out that since this year, the foreign trade situation has become more and more serious. The situation is complex and severe, uncertain and unstable factors are increasing, and downward pressure is still great.
The government’s emphasis may be a reflection of the still pessimistic foreign trade situation.
“The government is more powerful than ever in helping enterprises.” Huo Rongquan, vice chairman of Mona Lisa Group Co., Ltd., said in an interview with reporters.
Internal and external troubles
China’s exports cover a wide range of areas, including developed economies such as Europe and the United States, as well as emerging economies. Some people believe that the U.S. economic recovery will be beneficial to my country’s exports, but industry experts believe that global demand remains sluggish due to factors such as the rise of global trade protectionism and exclusive regionalization, as well as factors such as politics and war in some emerging economies. At the same time, rising domestic labor costs and increasingly fierce industry competition have also brought multiple burdens to enterprises.
China’s foreign trade recovery is struggling amid “domestic and foreign troubles”.
“Labor costs account for more than 20% of our profits, and we can’t afford people.” A person in charge of a Ningbo home appliance company told reporters, “Wages are rising year by year, and pensions, medical insurance and other insurances must be provided to workers. Buying it, this part is a heavy burden.”
There are many business owners who hold the same view. Among the nearly 30 companies interviewed by the reporter at the Canton Fair, more than half expressed the pressure of rising labor costs. Not only that, except for some large companies that have begun to use machines to replace people, most companies are more or less faced with the problem of recruiting workers.
Zhuang Rui said that my country’s foreign trade is in a transition period of optimization and upgrading. Old advantages such as demographic dividend are being lost, and new advantages have not yet been cultivated. At this time, companies are more sad.
Zhang Yansheng, secretary-general of the Academic Committee of the National Development and Reform Commission, said in an interview: “China’s economy is moving towards a new normal. In the past 35 years, the proportion of processing trade has dropped from 55% in 2005 to 35% last year. The next step will be It continues to decline. It has dropped by 20 points in ten years, and the structural changes are obvious. In other words, China has participated in the international division of labor with low-cost factors.�The era is over. ”
In the process of China’s foreign trade transformation, the impact of the external environment cannot be ignored.
Shen Danyang said that judging from the published foreign trade data, the exports of the world’s 32 major economies in the first two months showed declines of varying degrees. For example, the United States fell by 7.4%, Germany fell by 3.1%, Japan fell by 7.1%, South Korea fell by 15.7%, Taiwan fell by 12.4%, Canada fell by 9.8%, Brazil fell by 4.7%, and India fell by 9.8%. Whether it is a developed country or an emerging economy, whether it is the Asia-Pacific region or Europe and the United States, foreign trade data is trending downward.
Zhang Yansheng believes that poor global demand will still affect the foreign trade situation. The economies of Europe and Japan are not doing well. Although the U.S. economy has recovered, the recovery process is not very strong. Global demand is not good, which means that it is very difficult for foreign trade to be particularly good.
“To be honest, the international market is not good either. Our previous customers in Russia, Iran and other countries have been cooperating with us for more than ten or twenty years. It’s not that they don’t pay, but they are really under a lot of pressure. Including customers in Yemen, Nigeria and other regions, the deterioration of the local situation has also had a great impact on us.” A staff member of a building materials production company in Shandong told this reporter.
A battery manufacturer in Ningbo also expressed similar feelings to reporters: “We have done everything we can. The political and economic situation in the country where the customer is located is not good, and there is nothing I can do.”
“Now that global trade protectionism is on the rise, countries around the world are engaging in exclusive regionalization. The global open situation and the actual situation are actually very complicated, and there is a retreat of globalization. In addition, commodity prices continue to be depressed, which has a negative impact on the world. The blow to resource and energy exporting countries is very severe.” Zhang Yansheng said, “Global demand is not good, and it is normal for the foreign trade situation to be unoptimistic. If you are optimistic, it will definitely be at the expense of overdrafting the future. In the second half of this year and the whole of next year, I’m afraid the tough times will only be in the medium to long term, so companies must transform.”
Transformation is difficult
“It is not that easy for the government to talk about transformation and encourage technological innovation. I think it will take at least thirty years for technology to keep up with the level of developed countries.” The person in charge of a machinery manufacturer told this reporter. It is understood that the company is still an industry leader and has certain technical advantages.
The person in charge said: “Some production processes cannot yet be refined. The assembly of machines is mainly done manually, and even one gear cannot be matched. Labor costs cannot be reduced, and technological updates and R&D capabilities cannot be improved in a short time. . Now we are required to transform and innovate, which is too difficult.”
Zhang Yansheng said that foreign trade companies are very difficult now. The past 35 years of relying on low-cost, low-price, and low-end trade methods to participate in the international division of labor have come to an end. Now we rely on international competitiveness, talent, marketing, brand, quality, efficiency, etc. to participate in the international division of labor. Enterprise transformation faces five shortcomings . “Lack of technology, lack of brand, lack of talent, lack of funds, lack of experience and ability to transform. The next thirty years will be to solve the five shortages.”
Despite the difficulties in transformation, reporters learned at the Canton Fair that some companies have seized high-end market share through transformation and are transforming into high-end manufacturing with design and R&D capabilities.
“Before last year, our high-end market and low-end market share ratio was 3:7. Now it is reversed, with the high-end market share reaching 70%.” Huo Rongquan told reporters.
A person in charge of Easy Group also told this reporter: “Our order volume increased by 20% last year. Now the market is changing rapidly, and the competition of enterprises mainly relies on technological innovation and high-end markets.”
Different from previous years, reporters found that more and more companies have increased investment in innovation and R&D in the past two years. “Our annual innovation investment is at least one to two million yuan.” The owner of a small and medium-sized ceramic tile production company told reporters.
When talking about the issue of high-end market export volume growing against the trend, many experts said that the high-end market is highly elastic, the demand is relatively stable, and it is not easy to be replaced. However, the competitiveness of our products in developed countries is still weak.
“The transformation of foreign trade is to cultivate new advantages. Improving quality is a must, but we should not concentrate on the high-end market. Some companies do not yet have technological advantages, and it may not be suitable to emphasize being high-end.” Zhuang Rui believes that China’s biggest advantage lies in its With sufficiently diversified production capabilities, foreign trade exports must look at the difficulties of transformation from a longer-term perspective.
“China’s expansion into emerging markets is a better path. Because before we have successfully transformed, we cannot lose our traditional advantages. It is reasonable to expand into emerging markets and find a way out for our products.” At the same time, Zhuang Rui emphasized that even low-end products must meet certain quality standards. This is a matter of international image and international reputation. If you want to move toward branding, improving quality is a must.
During the interview, the reporter learned that many interviewed companies in home appliances, building materials, photovoltaics and other industries are already increasing investment in emerging markets. Despite pressures such as rising labor costs and sluggish external demand, some companies have successfully transformed from OEM to independent brands, developing independent brands in different markets and increasing technology research and development.
However, a large number of small and medium-sized enterprises that rely on the OEM model and lack innovation and R&D capabilities have still not found a way out.
Some companies have successfully transformed from OEM to independent brands, developing independent brands in different markets and increasing technology research and development.
However, a large number of small and medium-sized enterprises that rely on the OEM model and lack innovation and R&D capabilities have still not found a way out.
