Pearl River Delta Hong Kong And Taiwan Shoe Enterprises Pressure Doubled

Mr. Xu from Taiwan has worked in Dongguan, Guangdong for 14 years, mainly producing Christmas balls, Christmas ornaments and so on. Almost all products are sold to Europe and the United States. He said frankly, "business is becoming more and more difficult." After the Shenzhen Foxconn raises the salary event and the Foshan Honda strikes, the worker's mentality has changed. Now the workers are hard to recruit, and the wages demanded are high. The enterprises around me are very badly off. He said.

The Pearl River Delta is known as the "world factory" because of its huge manufacturing capacity, while Hong Kong funded and Taiwan funded enterprises are the first to enter the Pearl River Delta and to drive the rapid development of local manufacturing industry. But after the financial crisis, the changes in the operation environment of the Pearl River Delta have doubled the pressure of Hong Kong and Taiwan enterprises.

A recent survey by the Chinese manufacturers' Association of Hongkong on 222 member enterprises operating in the Pearl River Delta shows that the rise in labor costs ranks first in the most disturbing factors for Hong Kong enterprises. In addition, the rising prices of raw materials, additional costs and risks caused by labor regulations, and the risk of RMB exchange rate changes have brought heavy pressure to the operation of enterprises.

The survey shows that 60% to 80% of Hong Kong funded enterprises believe that the above factors have caused "serious" or even "very serious" effects. The low labor force was once a magic weapon for attracting foreign investment. At the moment, more than 90% of the respondents said they were troubled by lack of jobs. At the same time, the local government's requirements for improving workers' treatment are more clear. In May this year, Guangdong began to implement the new minimum wage standard, with an average wage increase of over 21.1%. Under the impetus of the trade union, the collective wage consultation system is also being pushed forward in the whole province.

"In fact, in recent years, some enterprises are preparing to move out of the Pearl River Delta, but the Foxconn incident has intensified the process. Now many Taiwanese enterprises are waiting to see the subsequent impact of this matter and reassess the living environment of enterprises. Cheng Fengyuan, President of Guangzhou Taiwan Funded Enterprises Association, said.

Cheng Fengyuan has his own industrial Jiaxing decoration materials Co., Ltd. he had not considered relocation before, but recently he decided to build a new factory in Chaohu, Anhui Province, and then move some of the production lines after completion.

"The cost there will be much lower. In terms of wages, the average wage of factory workers in Guangzhou has reached 2500 yuan to 3000 yuan, but it is estimated to be only about 1500 yuan over there. Of course, I will not move all the industries, because the Pearl River Delta has very complete industrial support and very convenient traffic conditions.

Liang Yaohua, a Hongkong based Guangzhou Tian Chong shoe industry Co., Ltd. has been expanding rapidly in recent years, but it is also facing the pressure of recruitment difficulties. "Since the Spring Festival this year, 1200 people have been recruited, but 998 have also left. We plan to raise employee wages by about 18% in the near future, and we expect that there will be a substantial increase in wages in the future. Liang Yaohua said.

In the face of challenges, more and more Hong Kong and Taiwan enterprises accelerate the pace of transformation and upgrading. Data from Hongkong Chinese Manufacturers Association show that strengthening market development, improving product quality and added value, and developing various new products are the most common coping strategies of surveyed Hong Kong enterprises. Many enterprises enhance their competitiveness by upgrading technology, improving process and operation process, adopting advanced machinery and equipment, and outsourcing some production processes. {page_break}

In addition to active innovation and upgrading, through diversification, efforts to extend to the upstream of the industrial chain, from manufacturing to service industry transformation has also become a trend of the development of Hong Kong and Taiwan enterprises in the Pearl River Delta. Cheng Fengyuan said that in addition to the main business of producing curtains, he spent a lot of efforts in developing the sales and service industry in recent years, becoming the general agent of Taiwan beer in Guangdong, Fujian, Hainan, Hongkong and Macao.

Feng Bangyan, Professor of the regional cooperation research center of Jinan University, Guangdong, Hong Kong, Macao and Taiwan, said that in the face of pressure, enterprises are no more than several results. First, industrial transformation and upgrading, the two is relocation, and finally, the fate of waiting for elimination. "The rising tide of pay brought by the Foxconn incident appears to be accidental, but in fact it is the inevitable result of the transformation of the mode of economic development in the Pearl River Delta, and the era of cheap and intensive labor supply is slowly ending." He said.

In fact, in recent two years, the Guangdong provincial government has been vigorously promoting industrial upgrading and transformation, but many Hong Kong and Taiwan enterprises still hope that these policies can be more targeted and operational. Liang Yaohua said that although we are a traditional shoemaking enterprise, we are also concentrating on R & D, design, production, brand operation and so on, hoping to develop into a headquarters economy. However, it is not known whether we can enjoy relevant policy support and preferential treatment. "We hope that the government transformation policy can be closer to enterprises and help enterprises tide over the current difficulties." He said.