"How To Break A New Path": Where Is The Direction For Chinese Shoe Enterprises?

Since two years ago, the European Union began to take anti-dumping policies on Chinese shoe enterprises. After many struggles and foggy future, Chinese shoe companies became the biggest worry of every Chinese shoe manufacturer.

"The world's 6 billion people, on average, each has a pair of Chinese shoes."

This kind of discourse has been a delight for a long time. However, since two years ago, the European Union began to take anti-dumping policies on Chinese shoe enterprises. After many struggles and foggy future, Chinese footwear enterprises became the biggest worry of every Chinese shoe manufacturer.

Since the European Union formally announced the anti-dumping investigation on two kinds of labor insurance shoes in June 2005, the shoe industry between China and Europe has been going on for more than 2 years.

Since October 7, 2006, the EU has imposed a 16.5% anti-dumping duty on Chinese shoe enterprises for a period of 2 years.

By September this year, China's shoe industry, which has been struggling for a long time, is facing a severe test again. The EU has officially launched an anti circumvention investigation of Chinese leather shoes.

For many Chinese shoe companies, the EU's punitive sanction is just as bad as worse.

China's shoe industry is in a predicament. "The world's 6 billion people, on average, each has a pair of Chinese shoes."

Such rhetoric has inspired China's footwear industry, and even affected all fields of Chinese manufacturing.

However, since the European Union's "one paper sanctions" began 2 years ago, the bubbling anti dumping incident has affected every Chinese shoe enterprise. Until the recent escalation of EU anti-dumping sanctions, Chinese shoe enterprises have been gradually trapped in the struggle and the future is full of fog.

Many years ago, when Wenzhou people exported the first pair of shoes printed with Chinese brand, the quality and cheap Chinese Xie Suizhi launched a journey to conquer the world.

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More statistics show that since 1979, 12 countries and regions have filed anti-dumping accusations against my footwear, involving $about 1000000000.

For the big exporters of shoes, anti-dumping restrictions are the most important factors. Over the past two years, the EU's "market demand" has caused many Chinese shoe companies to get into trouble.

Statistics show that since the European Union formally imposed a high anti-dumping duty on Chinese leather shoes, Pakistan, Peru, Venezuela, Canada and other countries have also taken anti-dumping measures on China's footwear products, and Japan, Russia and other countries have taken the same measures.

"This is a general blow to the whole industry."

Zhou Jinmiao, executive vice general manager of Kangnai shoe industry association and Kangnai group, said with great pain, "this is the biggest test that Chinese shoes have ever faced."

"The final ruling of the anti-dumping involves Chinese goods worth nearly 1 billion dollars. How should China's shoe enterprises survive and the employment of millions of workers?"

Insiders are even more worried about this.

Although China is a great shoe industry, it does not mean that the profits of Chinese shoes are objective.

According to the latest statistics, in the first half of 2007, China exported 4 billion 400 million pairs of shoes, with an amount of US $12 billion, representing an increase of 12.3% and 17.2% respectively over the same period last year.

However, behind the growth is the fall in unit prices.

"In 2006, only about 51 of the 1.5 or so export enterprises with an export volume of more than US $50 million accounted for only 0.34% of the total."

Wang Hanjiang, President of the China Light Industry Arts and crafts import and Export Chamber of Commerce, believes that this situation reflects the advantages and disadvantages of Chinese shoe enterprises.

It is understood that in 2006, 7 billion 800 million pairs of Chinese shoes were exported, with an average price of US $21 billion 800 million, and the average unit price was only US $2.8.

In the first half of this year, 4 billion 400 million pairs of Chinese shoes were exported, with a total value of US $12 billion, while the average unit price showed a downward trend.

"China's shoe exports are mainly middle and low grade, and the average unit price is less than the 1/3 of Italy shoes."

In September 2007, according to complaints from EU industry, it was suspected that the export of European leather shoes in China was circumventing the phenomenon of p shipment in Macao. The EU formally launched an anti circumvention investigation of Chinese leather shoes. This is just like adding to the Chinese shoe companies that have been struggling for a long time under the sword of anti-dumping.

The EU's game rules "high quality and low price" have once become the golden signboard of Chinese shoe enterprises. Unfortunately, this is not feasible in the EU's game rules.

The purpose of the European Union's anti-dumping investigation is to protect its own industries, the second is to raise prices, raise taxes and increase profits.

"Chinese shoe companies want to circumvent or reduce the price of the way to circumvent, this will only cause the EU's more attention and sanctions."

Rudi, who has worked for many years in the European Commission's trade division in Quanzhou, Fujian, recently reminded the participants of the Chinese shoe companies.

His words can be used for reference.

As a matter of fact, it is difficult for Chinese shoe companies to break the EU's rules of the game whether it is a price cut or a new plan.

In order to gather evidence, the European Union has sent people to Quanzhou, China, to investigate local shoe companies.

"Indonesia exported 25 million pairs of shoes in 2005 and two times after 2007. The data in Macao of China changed more, 2005 was 2 million 500 thousand pairs, and 2007 was 21 million pairs; in addition, Malaysia and Philippines also saw a sharp increase in footwear exports.

China's neighboring countries and regions have greatly increased the number of shoes exported to the EU, and do not exclude the fact that Chinese shoe companies bypass the third party to avoid responsibility.

In a sense, although this may be the EU's speculation, rules are all above everything else. As long as it is recognized, Chinese shoe enterprises can not escape the possibility of being taxed.

In addition, it is more sensitive to EU anti-dumping measures by reducing prices.

In fact, the EU has already made preparations for this legislation: if the Chinese footwear enterprises have the absorption behavior after two years of effective anti-dumping policy, the European Union will start the anti absorption investigation quickly; if the export prices of Chinese shoe enterprises are reduced, and the sales prices of imported products in the EU have not changed much, the EU will also recognize that Chinese shoe companies are dumping.

It is reported that the European Union has started the investigation procedure to determine whether the absorption and avoidance behavior exists. Therefore, the Chinese enterprises involved in the absorption and evasion will be imposed higher anti-dumping duties in the next round of review.

"The real effective way is to circumvent reasonably through arrangements such as pnational corporations, or to produce in third countries, and really change the origin of products."

In desperation, some Chinese shoe companies only choose this way to deal with the EU's rules of the game.

After the EU's mandatory rules game, Chinese shoe companies have also perceived the true purpose of their anti-dumping.

"Market economy status and anti-dumping are only a means to achieve the goal of the European Union, and it is a" trick "to make money.

In the shoe city of Quanzhou, local entrepreneurs share similar views.

Under the overlord clause of EU's game rules, the competitiveness of China's shoe brand export enterprises has been reduced, and orders have been reduced. Some small and medium-sized enterprises have even given up exports to the EU.

In the face of EU sanctions, quite a few Chinese shoe companies have taken up legal weapons and put forward a request for re examination: the famous footwear enterprises in Fujian, China, represented by "rich birds" have been carrying on.

"The whole world knows that the shoemaking industry is a labor-intensive industry. Now the trend of global industrial division is bound to shift the shoemaking industry to many countries and regions where labor is cheap and cheap, and no protection measures can change this trend."

Liao Haijun, the overseas manager of "fortune bird", believes that the EU will have a long-term trend to raise the tax rate of its imported shoes, and "rich birds" will not give up the punishment of this punitive measure.

In October this year, the relevant provisions of "anti-dumping for 1 years to apply to the European Commission for review and request for a new ruling", including Quanzhou shoe manufacturers of several export footwear enterprises in Shishi, have prepared and participated in the EU's preparatory work for the review of China's footwear products during the anti-dumping period, in order to win market economic status and change the 16.5%% anti-dumping duty rate.

Can China's shoe enterprises change the rule set by people?

"European market" is not the only trade barrier against the European Union. It is aware that this trend will not allow China's shoe companies to "slaughter". On the one hand, they should actively respond to litigation, and on the one hand, they will start looking for markets through multiple channels.

For the future of China's footwear industry, China's footwear enterprises show an unprecedented unity: in February 9, 2006, Chuangxin group and other 8 Guangdong leather shoes production giants set up the EU's anti-dumping alliance against China's shoes products. In March 8th, Fujian, Guangdong and Zhejiang three footwear associations first formed the EU anti-dumping Alliance, and issued a "Declaration on coping with alliances".

In April 3rd, 14 shoe companies in Wenzhou, including Kangnai, AOKANG, red dragonfly and Dongyi, issued the Joint Declaration on "EU anti-dumping". They expressed strong dissatisfaction and solemn protest against the EU's anti-dumping duties on footwear products in China. In June 2006, representatives from the footwear industry in China were active in various parts of Europe, and contacted the importers and retailers of the European Union to strive for a positive impact on the EU's decision-making.

In August 2007, the China Footwear Association jointly organized by the China Light Industry Crafts Import and Export Chamber of Commerce, China Leather Association, Hongkong Footwear Association, Guangdong Footwear Manufacturers Association, Wenzhou shoe leather industry association and so on, was formally established in Beijing.

After suffering from EU anti-dumping, Chinese shoe enterprises gradually became familiar with the EU's rules of the game, and many shoe companies began to take the high and middle grade line to cope with the long-term barriers.

"It is not a new opportunity to treat trade frictions with a positive attitude.

Enterprises can adjust their product structure, quality and competition strategy, and the whole industry will also greatly improve.

Zhou Shijian, an expert in economic and trade relations, believes that the Chinese shoe enterprises under the predicament should pay more attention to their own competitiveness.

In fact, when the efforts of many parties have not seen much success, Chinese shoe companies have begun to realize the fact that the EU market is not the only choice while upgrading itself.

In November 2006, 4 months after the EU's decision on Chinese shoe enterprises came into effect, the China Africa Cooperation Forum Beijing summit and the third ministerial conference were held in Beijing.

China and Africa have in-depth discussions and cooperation in the economic field. During the summit, second Chinese African entrepreneurs' conferences were held, and Chinese footwear enterprises ushered in a historic opportunity.

In recent years, the trend of China's shoe export to Africa is growing rapidly.

China's shoe industry led by Quanzhou has also increased investment in Africa in recent years, and Zhejiang shoe enterprises are also unwilling to lag behind. Data show that in the first three quarters of 2006, only Zhejiang province exported to Africa reached 210 million pairs of shoes, with an export volume of 320 million dollars, up by 38.4%% and 30.5%% respectively.

At the same time, the Chinese government has begun to act.

It is learnt that, apart from clarified preferential policies for investment in Africa, such as capital, foreign exchange, entry and exit, materials and so on, in order to pfer domestic excess capacity and avoid increasingly serious international trade barriers, the Ministry of Commerce's plan to promote the establishment of 10 overseas economic and trade cooperation zones by Chinese enterprises is gradually being implemented. These Chinese enterprises will receive the support of the government which can provide up to nearly 100 billion yuan.