Economic Half-Hour: Why Is Jiangsu'S High-Tech Enterprises Unaffected By Deflation?

In early July, national leaders went to Jiangsu, Zhejiang, Guangdong, Shandong, Shanghai and other places to conduct intensive research, investigate the economic operation of various regions, and thoroughly understand the difficulties faced by various enterprises. Premier Wen Jiabao visited their R & D center in a high-tech enterprise located in Suzhou Industrial Park. This is the core Department of the enterprise and puts forward that "the core of enterprise competitiveness is intellectual property."

With the rising cost of raw materials, the depreciation of the US dollar, the tightening of money and the spread of the subprime mortgage crisis, a series of negative factors have appeared in the first half of the year. How many challenges have the Chinese economy faced?

How will we adapt to the new environment of global economic cooling?

Since the beginning of July, the leaders of the country have conducted intensive research in Jiangsu, Zhejiang, Guangdong, Shandong, Shanghai and other places, inspecting the economic performance of various regions, and thoroughly understanding the difficulties faced by all kinds of enterprises. Through these investigations, can we find the prescription for the Chinese economy and find the prescription for the right remedy?

Today we will go to see the Suzhou industrial park just inspected by Premier Wen Jiabao.

Enterprises in Suzhou industrial park can maintain normal operation because of their core technology.

In a high-tech company located in Suzhou Industrial Park, Premier Wen Jiabao focused on visiting their R & D center, which is the core Department of the company.

Wen Jiabao: "the core of the competitiveness of enterprises is intellectual property. Like your company, both software and hardware, software is largely intellectual property. The source of intellectual property is in people, in the human brain, so you need a large number of talents."

Jiang Liwu, general manager of Zhongyi technology company, also clearly remembered that the prime minister was very concerned about the importance of talents and R & D as well as the impact of various adverse factors at home and abroad.

Jiang Liwu, general manager of Zhongyi Technology Co., Ltd.: "the prime minister is very concerned about the situation of the price rise of materials like this, and whether the exchange rate changes have any impact on our business operation. He also asked," of course, the prime minister is very concerned about this matter. We reply to the premier that we strive to overcome as much as possible. "

In fact, since last year, due to the rising price of energy raw materials, the rising labor costs, the depreciation of the US dollar and the weakness of the international market, Jiangsu, as a major economic province and a strong economic province, has also been impacted. Statistics show that, in 1-5 months, Jiangsu's economic growth slowed down slightly, especially in Jiangsu's key export industries, such as Electromechanical, textile and clothing, which had encountered unprecedented difficulties. Data show that in the first quarter of 2008, 1066 textile and garment enterprises that made profits last year stopped their export business, accounting for 13% of the total number of export enterprises.

What is the situation of high-tech enterprises?

Suzhou industrial park industry committee secretary Ma Minglong: "we have also done a lot of investigation and research, asked a lot of enterprises, we feel that the first half of the first half of the year is still relatively normal, there are some costs rising, there are some changes in policy, such as the textile industry or some impact, but like our electronic industry, because it is more than sixty percent of our entire industry, because they are relatively healthy, the market is also better, so the whole first half of our year, economic and social indicators are better."

Since the beginning of this year, the Suzhou Industrial Park has maintained a relatively good growth trend under the situation of tighter international and domestic environment and increasing macro environment and resources and environmental constraints. In the first half of this year, the Suzhou Industrial Park realized a GDP growth of 50 billion 200 million yuan, an increase of 21% over the same period last year, and the total import and export volume was 32 billion 300 million US dollars, an increase of 26% over the same period last year, which has increased by nearly 16 percentage points over the same period last year. In view of Ma Minglong's view, the reason why the park is not affected by many adverse factors at home and abroad is mainly because they have a large number of high-tech enterprises with core competitiveness.

Ma Minglong: "that is to say, the starting point for attracting investment is very high. Basically, it is more concerned about emerging industries, less polluting industries, and the R & D investment of these enterprises is relatively good, so it is precisely because their product competitiveness is relatively strong. Therefore, even though there are some cost increases now, there are some policy changes that will not affect the operation of their enterprises, including the output value and profits of enterprises."

Constantly adopting new technologies and developing new markets to enable enterprises to remain stubborn vitality.

With its own core technology and its own market, enterprises in Suzhou industrial park can still maintain normal operation.

However, in the interview, we also found that some enterprises in this year still had stagnation in performance under the successive impact of the unfavorable factors such as cost and exchange rate.

Running an enterprise is like sailing against the current. How to recover the momentum of development before going backward?

This is a headache for many business management.

Zhongyi technology is an enterprise founded by software research and development. It is mainly engaged in the design and manufacture of network products. Since its establishment in 2004, the sales performance of Zhongyi technology has increased several times every year.

Jiang Liwu, general manager of Zhongyi digital technology (Suzhou) Co., Ltd.: "we started building factories in 2004, and by 2007, we have achieved 1 billion of export sales, and the proportion of the whole growth may be nearly 100 times."

However, in the first half of this year, this rapid growth momentum stopped abruptly.

Jiang Liwu: "we are compared with before. In the first half of this year, we basically did not grow sales, our main customers are in the United States and Europe, then you are very clear, in recent half a year, the foreign economic situation is actually not optimistic, including our sales of products related to the entire family network products, in fact, will be affected."

But for the company's future development prospects, Jiang Liwu does not seem to be worried, because their latest research and development of new products - home security system received a large order from abroad, and sales momentum in the US market is getting better and better, which makes him see a new hope.

Jiang Liwu: "that is to say, the traditional family security system is fixed in a family environment. After integrating the broadband into it, for example, when you travel, you can still control the settings and switches of all the security in your home while you are in the office, and even observe the changes in the environment and environment through this IP camera."

When Premier Wen Jiabao visited the company, Zhongyi company showed their new system to prime minister.

Jiang Liwu: "the prime minister was very interested in this system. When the premier came, we showed the photo to the prime minister. This photo is the prime minister's exit from the elevator. We helped him to capture the picture and immediately printed it out in the room. So when the premier came in, we took this picture to him. The prime minister was surprised when he saw it, but he was also excited. He said," how did we get the picture down? "So we began to explain slowly to him that the design of the security system was reasonable and that the prime minister felt that the system was very good and he was also very interested.

In Jiang Liwu's view, the reason why the company is not affected by all kinds of disadvantages is that they have a strong R & D team, which makes the company continue to have more value-added new products.

How does Suzhou Industrial Park support the development of high-tech enterprises?

Reporters learned that there is a venture capital group under the government of the Suzhou Industrial Park, which specifically supports high-tech enterprises. Only in the first half of this year, Guarantee Corporation, a small and medium-sized enterprise in Suzhou Industrial Park, provided a guarantee of about three hundred million yuan for bank loans.

Jiang Liwu: "then we should deal with recession or economic shocks. In fact, the best way to deal with them is to constantly integrate the updated functions, provide products that consumers need, and let the product be added value, so that I can smoothly break through the bottleneck of this recession."

Jiang Liwu told reporters that Zhongyi company had 2100 employees, of whom 300 were R & D personnel.

Jiang Liwu: "we are going to make a new expansion this year. We plan to add 150 new employees here this year, so we have reserved such a big space."

Reporter: so, where are all of your R & D personnel from?

What kind of people are they?

Jiang Liwu: "our R & D personnel come from all the key schools in China. In fact, there are all provinces and cities. We are farthest from Harbin or Xi'an, or Chongqing and Chengdu to Nanjing and Suzhou.

In fact, in Suzhou Industrial Park, many enterprises are trying to find ways to overcome the pressure brought by rising costs through R & D and innovation. Bao Shi is an enterprise that integrates R & D, manufacturing and marketing of electric tools. The products are distributed in almost more than 50 countries and regions of the world. Due to the fact that the company's products are almost all exported, the profits of Bao Shi have greatly shrunk in the context of a significant depreciation of the US dollar and a substantial increase in the cost of raw materials and labor.

Wu Xiaodong, vice president of Bao Shi De machinery (China) Co., Ltd.: "if compared with the end of last year, the losses caused by all these shocks will be around seventy million yuan, if compared with the same period in July last year, it would be more than 120 million yuan."

Wu Xiaodong said that in the first half of this year, the RMB appreciated by 7% against the US dollar, which only caused the company to lose about twenty million yuan. What worries them most is that they do not know how much the renminbi will appreciate in the future.

Wu Xiaodong: "the contract is always signed for two or three years. If I don't have a very clear forecast, I can only estimate how much impact you want to have on the business. I signed the contract three years ago, and now I have to supply him with the original price, which is irreversible."

Mr. Nick, from the US, is currently the vice president of marketing at Bao Shi De company. He told reporters that it is more and more difficult to sign contracts with customers now.

Nico, vice president of marketing of Bao Shi De company, said: "we have already thought of some ways. We used to sign long-term contracts for two or three years, and now only sign a few months' short-term contracts, because we can not predict the future changes of the exchange rate. The relationship between me and my partners is very frank. According to different circumstances, we can shorten the contract to 3 months, 6 months, etc., we can wait and see what changes will happen in the market next."

Not only did the terms of the contract shorten, Mark said, but there were many additional clauses on their quotations.

Nicole: "for example, the offer is valid within two months, and the price can only remain unchanged for six months. Another provision is that if the RMB exchange rate changes substantially in terms of the price of raw materials, we can not control the situation. Our supplier has the right to reserve the right to modify the price."

In addition to passively shortening the contract period to deal with the unfavorable factors such as exchange rate changes and raw material prices, Bao has to put more strength into R & D innovation, and continuously develop new products to improve the added value of products and expand new markets.

Wu Xiaodong: "this is a lawn mower we developed last year. We didn't say it was a very high-tech product, but we used the best technology and mature technology in the world for this machine. This machine sold 40 million dollars in the US last year, and this year it is estimated to exceed 60 million dollars."

Wu Xiaodong said that the annual cost of their research and development was $40 million, and 170 engineers engaged in R & D developed 180 new products last year.

Wang Jiada, vice president of Bao Shi De machinery (China) Co., Ltd.: "now our company has accumulated more than 1200 patents, for example, like this product in a small product, we already have more than 50 patents. Because this product is launched, we have developed another new customer base, which has brought a very substantial economic benefit for the company."

Despite exchange rate changes, rising labor costs of raw materials and labor, and weak international markets,