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"Made in China" is climbing to high-value chain not only by cost advantage

Hits:Updated:2018-06-20 10:06:23【Print】

As small as a button and as large as a turbine unit, the manufacturing industry represents the well-being of people's livelihood and represents the comprehensive national strength. China has the ability to "convert innovative design into a reliable, reasonably priced finished product." This is a unique feature of China relative to developed countries.
Exports have formed a diversified pattern

McGill is a taxi driver in Addis Ababa, the capital of Ethiopia. Although far away in East Africa, daily life has many connections with China: he uses a Huawei mobile phone and wears clothes made in China. The "Made in China" loyal fans. "Cheap and durable," this is the label that he affixes to "Made in China" when he talks to this reporter.

In an interview in Africa in 2002, this reporter noted that from Morocco to Algeria, from Cameroon to South Africa, apart from occasionally seeing billboards from Chinese companies, Chinese goods on the market are rare. That is, for more than 10 years, the situation is completely different. From the spread of goods to high-end goods, "Made in China" is spread all over Africa, with a wide range of sales and sales.

Europeans and Europeans seem to be familiar with "Made in China" earlier than Africans. Clothing, shoes, hats, souvenirs, and electronic products are just a few examples. If these observations are carefully compared, it is not difficult to find a very important feature in these dazzling arrays of Chinese goods: In recent years, “Made in China” has begun to develop in the United States and some other countries, and the proportion of clothing, shoes and hats has declined, and electronics And home appliances gradually entered the US market, such as Haier refrigerators, Hisense TV and other Chinese independent brands have emerged in the United States large-scale chain stores. American John told this reporter that not long ago he had just bought a cell phone, not Apple, not Samsung, but ZTE mobile phone, "use it to call, send and receive mail is very convenient."

Exports of Chinese products have already formed a diversified pattern. After joining the World Trade Organization in 2001, "Made in China" has accumulated a lot and accelerated the pace of entering the world market. The export of garments and other labor-intensive products is booming. The "cakes" of high value-added products such as ships and machine tools continue to grow in the world market. In 2010, China surpassed the United States as the world’s largest manufacturing country. Dr. Sergei Savinski, Ph.D., an expert in the international financial center of the Institute of Finance of the Russian Ministry of Finance and an expert on China’s economy, said: “It is not easy. We must know that the United States has been leading the field for more than 100 years.”

Not only rely on cost advantages

With the deepening of China’s openness to the outside world, the outward-looking nature of manufacturing has become more prominent. There is public opinion that "Made in China" devoured the market share of many countries and grabbed the "rice bowl" of others. It is precisely because of this that trade protections and disputes against Chinese exports have occurred from time to time. China National Heavy Duty Truck Group Chairman and Secretary of the Party Committee Ma Chunji told this reporter that during the process of developing the international market, Sinotruk often encountered trade barriers and trade protection of other countries.

“There will be some crowding effect. This is what the market economy is.” Li Xiaohua, a research fellow at the Institute of Industrial Economics at the Chinese Academy of Social Sciences, frankly stated that “China’s manufacturing industry has such a high share in the world market that it relies not only on cost advantages.” China owns “innovation” The ability of a sexual design to transform into a reliable, reasonably priced finished product." This is a unique feature of China relative to developed countries. “A product and a prototype are made, and China can carry out large-scale production very quickly and cost-effectively, and it can integrate the world's resources for processing and manufacturing.”

The photovoltaic industry is a living example. Polysilicon furnaces are from US companies, components are from DuPont, senior management personnel are from leading foreign PV companies, and China integrates resources from all over the world to form “Made in China”.

“Today's manufacturing industry is a pattern of global division of labor and vertical division of value in the value chain. Many manufacturing production activities include you among me and you.” Li Xiaohua said that this unique capability of the Chinese manufacturing industry can be the country where the upstream and downstream companies are located. Bring opportunities and markets.

Technological innovation is an important way out

At present, China's manufacturing industry is constantly on the rise to a higher level of the industrial chain, and the export of high-tech products is increasing. According to data from the National Bureau of Statistics of China, in 2012 and 2013, the export value of high-tech products in China reached 601.2 billion U.S. dollars and 660.3 billion U.S. dollars, respectively, an increase of 9.6% and 9.8% respectively from the previous year.

Ma Chunji told this reporter that in 2013, China Heavy Duty Truck exported 24,000 heavy-duty trucks. Among them, the heavy-duty truck products that reached the Euro 5 standard created a precedent for China's heavy-duty trucks to enter the developed regions in bulk. At present, Sinotruk has established marketing bases in more than 40 countries and regions around the world. Its products are exported to more than 90 countries and regions, and it has the ability to export 35,000 heavy-duty vehicles each year.

Changes in the structure of export commodities have reflected the development and changes in China's manufacturing industry in the new period. “The United States and other developed countries are leading the high-end manufacturing industry, China is at the mid-end and climbs to higher value chains, while labor-intensive manufacturing is shifting to countries and regions with lower labor costs.” American Brookings Institution Senior researcher Martin Bailey said in an interview with this reporter.

In recent years, some people think that China’s demographic dividend has declined, labor costs have risen, and labor-intensive industries have faded. In this regard, Li Xiaohua does not think it is necessary. He said that a stable political environment, well-developed infrastructure, laborers with certain qualities, and support for industrial supporting facilities are the conditions for realizing industrial transfer. Judging from these factors, it is difficult for countries in Southeast Asia, Latin America and other regions to completely replace China in the short term. Take the clothing industry in Vietnam as an example. In 2012, Vietnam’s net export of apparel was US$13.46 billion, but net imports of the textile industry exceeded US$5 billion. "Vietnam's raw materials cannot keep up, and the needles and brains must rely on imports. China's industrial system is relatively complete."

Some analysts believe that although the advantages are still there, the challenges facing China's manufacturing industry cannot be ignored. On the one hand, China needs to carefully handle some of the price advantages lost due to rising labor prices. On the other hand, the world economy and trade have not yet fundamentally recovered, export pressure has increased, and endogenous power has become a source of sustained economic development in China. Therefore, technological innovation has become an important outlet for the future development of China's manufacturing industry.

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