2011 China'S Manufacturing Industry Is Mixed With &Nbsp; In The Face Of Low Profit Margins.

2011 is a year of "made in China".

Beginning of the year

Industry research shows that China is a relatively small number of countries with relatively high manufacturing, middle and low end industries in the world. In the past, China's rapid economic growth was mainly due to the pformation of the world's low and middle manufacturing industries, and in the future it must be at the high end.

Joy and sorrow of "the world's first"

According to the United States

According to statistics from the United Nations, some Chinese economists found that the value of China's manufacturing industry was $2 trillion and 50 billion at the beginning of 2011, while that of the US manufacturing industry was US $1 trillion and 780 billion.

In any case, in terms of data alone, the manufacturing industry surpassed the US in output value, which is good news for Chinese people.

Many analysts call it "historic pcendence".

In fact, China's manufacturing output accounted for 30% of the world's manufacturing output in 1830s, but the subsequent outbreak of the Opium War pushed the achievement to a trough. By 1900, this share had dropped to only about 6%.

After that, China has been catching up for more than 100 years.

In fact, more detailed data can prove that China's manufacturing capacity "first" is worthy of the name.

For example, from the basic industrial data, in 2010, China's crude steel output was 6.27 billion tons, accounting for 44.3% of the world's total output, more than second to twentieth total; cement production of 18.68 million tons, accounting for 60% of the world's total output; 15 million 650 thousand tons of electrolytic aluminum, accounting for 65% of the world's total; refined copper production accounted for 24% of the world's total, while consumption accounted for half of the world's total; coal output was 32.4 million tons, accounting for 24% of the world's total output; fertilizer output accounted for the world's total; chemical fiber production accounted for the world's share; and glass production accounted for the world's total.

In addition to oil and ethylene, China's basic industrial capacity is among the best.

In terms of specific products, China's pcript is also outstanding -- 18 million 264 thousand and 700 cars, more than the United States, accounting for 25% of the world's total output, shipping output accounts for 41.9% of the world's total, and construction machinery accounts for 43% of the world's total.

China has also produced 68% of the world's computers, 50% of color TV, 65% of refrigerators, 80% of air conditioners, 70% of mobile phones, 44% of washing machines, 70% of microwave ovens and 65% of digital cameras.

Interestingly, with the rise of gold investment in China, in 2010, China also produced 340 tons of gold, ranking first in the world.

However, the sustainability of China's huge manufacturing industry needs to be explored.

Especially since this year, the prices of production factors such as land, raw materials and labor in China have risen. Many people are worried about whether China can maintain their existing advantages.

It is reported that some scattered "foreign capital" withdrawal phenomenon did occur.

For example, Ford Motor announced that it was preparing to manufacture some parts of the car in the United States, after which China was the first choice for building new plants.

The US ATM (bank teller machine) supply giant NCR has moved some of the production of ATM from China back to the United States.

Construction machinery giant Caterpillar is also ready to "go home" to create jobs for the native.

In the Pearl River Delta region, an American company producing high-end baseball carbon fibers is ready to move back to the mainland.

And high-end headphone maker Sleek

Audio will be withdrawn from Dongguan.

According to the analysis of the researchers, new round of industrial pfer is emerging in the world, and the "pfer" of the high value-added industries in developed countries seems to be quietly coming.

HIS also said that the United States need not be too pessimistic about losing the "first".

Because the United States has a huge labor productivity advantage, embodied in the fact that the US manufacturing output in 2010 was only slightly lower than that in China, but in the US manufacturing industry there were only 11 million 500 thousand workers, while the Chinese manufacturing industry employed 100 million people.

At the same time, a large part of China's manufacturing output comes from Chinese subsidiaries of American enterprises.

A person familiar with the Guangdong provincial economic and trade department believes that "the international financial crisis has forced developed countries to re-examine their domestic industrial structure, explore the road of revitalization of the real economy, encourage high-end manufacturing to stay in China, and even return from abroad to the mainland."

The Boston consulting firm's report even predicted that 15% of the US companies targeted at the North American market would return from China to the US.

According to the Ministry of commerce data, in the first 8 months of this year, the United States invested 967 newly established enterprises in China, down 5.29% from the same period last year, and the actual amount of investment in foreign capital amounted to 2 billion 545 million US dollars, down 14.42% from the same period last year.

However, this decline is not a worry.

At the same time, in the first 8 months, 10 Asian countries and regions invested 14496 newly established enterprises in China, an increase of 8.66% over the previous year, and the actual amount of investment in foreign capital amounted to US $66 billion 972 million, an increase of 23.12% over the same period last year.

EU's 27 countries' investment in China also keeps growing.

The Boston consulting firm's report did not forget to hint: "in 2010, the labor cost in the Yangtze River Delta region in China is also only 25% of that in Western Europe. With the increase of labor costs, the labor cost in China is expected to reach 38% of the labor cost in Western Europe by 2015.

But this growth is not enough to form a turning point. "

The Southern China Special Economic Zone report on economic conditions in Southern China, released by the American Chamber of Commerce in the United States, said that 75.1% of the main business of American enterprises in China turned to provide products and services to the Chinese market and no longer exported to other countries. In 2003, the figure was less than 24% in 2011.

Therefore, it is still the mainstream for US capital enterprises to increase investment in China.

Harry Saiyadin, the president of the chamber of Commerce, told the media that most of the enterprises that China moved to other low-cost regions were mostly reprocessing and manufacturing industries with labor-intensive, low technology and high energy consumption, which usually had a great impact on the environment. "Moving away from China is also a good thing."

Gain and loss of "made in China"

The Chinese Academy of social sciences has recently analyzed the market share and competitiveness index of more than 100 countries in the world. China also ranks first in the world.

However, the publishers talked more about the "difficulties" faced by China's manufacturing industry.

Jin Bei, director of the Institute of industrial economics of the Chinese Academy of Social Sciences, believes that "made in China" is faced with tremendous pressure on the rise of resources, environment and cost. The profit margin of the industry is obviously low, and even the vicious circle of "going to manufacturing" or "de industrialization".

Wenzhou is a typical example. This area, which has been rapidly rising by manufacturing industry, has fallen into the trap of financing bubbles because of the "ceiling" of industrial upgrading.

In fact, the difficulties of "made in China" in the global rise are far more complex than those of simple numbers.

Jiang Yong, a researcher at the Institute of modern international relations of China, believes that China's manufacturing has also paid an astonishing price behind its huge achievements.

When Britain, Japan and the United States played the role of "world factory", they basically grasps the initiative of international division of labor, and the international resources are abundant and cheap.

"Made in America" and "made in Japan" are based on cheap oil with only a few dollars per barrel.

But China has seen oil prices surging from tens of dollars per barrel to US $100 billion. High oil prices have become the norm.

In addition, China's iron ore trade negotiations are always exploited by resource monopolies, resulting in the current Chinese steel industry facing the threat of loss in the whole industry.

Moreover, since China's accession to the WTO, "made in China" has become the number one target of world trade protectionism attacks.

China has been the largest member of the anti subsidy investigation for 15 years in a row. In 2009, 35% of the world's anti-dumping cases and 71% of countervailing cases were related to China.

Jiang Yong said that in the international competition, Britain, the United States, Japan and other countries, as "world factories", were at the top of the international division of labor chain and had a near pride of status.

However, today, as a "world processing plant", China needs not only to "look ahead" but also to "take care of it". There are trade barriers and technological chasm in the developed countries ahead, followed by low-cost troops in India, Mexico and Eastern Europe.

Yang Fan, director of the World Economic Research Institute, School of business, China University of Political Science and Law, said that China's labor-intensive products are extensive at present. Export growth is mainly driven by low price and quantity, low degree of product processing, small added value and lack of famous brand.

And the lower this state is, the easier it is to be challenged.

At present, China's manufacturing is backward in key production links and core components, with low level of equipment.

Iron and steel, nonferrous metals, petrochemicals, electricity, coal, building materials and other 15 industries, technology level is generally lagging behind international 5~10 years, and some are behind 20~30 years.

For example, even in the traditional pillar industries, China's manufacturing industry is faced with problems such as "overcapacity of initial processing, lack of deep processing capability", "high value-added final products, and export products being won by quantity".

For example, China's steel production is the world's first, and only 15%~20%'s equipment is an international advanced level.

The total sales of Baosteel, Anshan Iron and Steel Group, Shougang Group and Wuhan Iron and Steel Group four are only 63% of that of Nippon Steel.

Yang Fan said that the key to reflecting the capability of a country's manufacturing industry is the national equipment (equipment) manufacturing industry.

However, due to the serious impact of foreign investment and imported equipment, China's fixed assets investment in the whole society, equipment investment has 2/3 rely on imports, of which 100% of optical fiber manufacturing equipment, 85% of integrated circuit chip manufacturing equipment, 80% of petrochemical equipment, 70% of cars, CNC machine tools, textile machinery and offset printing equipment are imported.

He believes that from the general labor intensive upgrading to skilled labor, capital intensive, and technology intensive, China will continue to play a comparative advantage in the path of industrial upgrading, but at present, "technology brand monopoly that faces international capital".

"Through the technological innovation strategy research of China's 7 industries (program-controlled switches, CNC machines, chips, software, steel industry, sedan"), we find that the technology that foreign investors provide to our joint venture is always mature and began to decline. Therefore, it is very difficult to cultivate independent development ability with market technology.

The gains and losses of "made in China" should be observed in the global economic structure. This is not just a matter between China and the United States.

Jia Genliang, a professor at the school of economics, Renmin University of China, believes that the outbreak of the financial crisis has made people realize that the world economy is monopolized in the hands of pnational corporations. By way of "two heads to eat", most of the proceeds are concentrated in the hands of monopoly capital. On the one hand, pnational corporations exclude competition in the final commodity market by "vendor monopolization"; on the other hand, it creates a "buyer monopoly" in the producer market, forcing producers in developing countries to be continuously depressed.

The result of this cycle is that the fruits of technological progress are basically pferred to the multinational corporations as a "middleman" in the form of profits in the form of profit. This not only increases the real purchasing power of consumers in developed countries, but also leads to the stagnation or even decline of the incomes of workers and peasants in the developing countries.

This means that despite the fact that "made in China" has done a lot of work, Chinese labor has not received the corresponding income.

He said: "pnational corporations have not only caused developing countries, but also caused serious shortage of domestic demand in developed countries, which is an important cause of the serious polarization of income distribution between capital and labor."

Only by "spoil research" can we grasp the future.

For any country, real wealth creation depends on manufacturing.

Jiang believes that although the manufacturing industry in the United States is still very strong, from the lessons of the financial crisis, their social elites are active in consulting, accounting, finance, mergers and acquisitions, media and other sectors, while technological innovation lacks talent reserves, and engineers are marginalized, making the manufacturing industry "a tree without a root and a passive source of water".

As a result, "productivity is shrinking, technological innovation is becoming weaker and weaker, and economic engines are getting weaker."

In this way, the bubble economy will enable more and more entrepreneurs to "earn money and earn money quickly without pains and pains." people engaged in manufacturing industry have "abandoned real practice" and go directly to the capital game of "making money with money".

This is precisely the "rotten" tendency that "made in China" needs to be strictly guarded against.

Yang Fan also believes that the key to China's economic pformation is to control the housing bubble so that excess capital and industrial capital can be used for technological progress, rather than entering the bubble economy.

He said that China is in the middle and late stages of heavy chemical industry, and has huge investment demand. Steel production is the main symbol, from 300 thousand tons in 1949 to 6 million tons now, and the United States has been hovering at 1 billion tons.

But China's steel stock is only 50% of the United States, and after a few years the stock will catch up with the United States, and the steel output and economic speed will decrease.

"It is not wrong to say that China's economic growth is declining year by year, but this is done at the same time as economic restructuring, efficiency and quality improvement. It does not mean that there is a problem in the economy," Yang Fan said. "On the contrary, the speed is not down, the structure is not improving, that is the problem; the collapse of the bubble economy makes the domestic economic growth rate drop suddenly, which is a big problem."

Yin Xingmin, a professor at Fudan University in Shanghai, thinks that although China's manufacturing industry is catching up with the United States after entering the new century (12.26,0.18,1.49%), there is still a big gap between China and the United States from the perspective of labor productivity (per capita manufacturing value added). In 2007, the labor productivity of China's manufacturing industry was only 1/5 of that of the United States.

This is mainly determined by the level of technology.

In fact, as far as the scale of output is concerned, China is the biggest manufacturer in the world. The key lies in the level of technology and the corresponding profit distribution. "Made in China" is far from the "made in the United States" position.

This conclusion, as long as we look at the apple mobile phone industry chain distribution is very clear.

"Made in China" can not be tired by the world's first name.

From the 1990s IT industrial revolution, the United States did let out the low and low profit manufacturing industries with lower profits and weaker competitiveness. But in the fields of high-end technology, patents, military industry, standards, brands, and designs that could maximize profits, "made in the United States" remained in the mainland.

This year, the so-called "American made" reflux is also mostly high-end technology and high profit manufacturing industry.

Song Xiaojun, a researcher at the China shipbuilding industry comprehensive technology economy research institute, said, "popularly speaking, the advantage of China's manufacturing industry is mainly that he is an all-round player, while other countries, except the United States, are more or less disabled."

He believes that this also determines that the Chinese player, to complete the technical moves, "difficulty coefficient" the highest, so we must "spoil the scientific research"!

Yang Fan said, "some people are against developing independently, because the investment is too big, not as joint venture. In fact, China has great advantages in development."

According to his research, the development of cellular phones is 800 million yuan for foreign development, 70 million yuan for China, 100 million yuan for overseas program-controlled switchboards, 10 million yuan for China, and for the development of "long three armour" rockets, China is also one of the tens of foreign countries.

This means that the low cost of human capital and the "comparative advantage" should be reflected in the level of technology and R & D.

China must make great efforts in the "super industry" with the core of national defense industry, including nuclear, aviation, aerospace, shipping, electronics and so on.

He said that China's manufacturing can take the "two parallel paths": follow the laws of market economy, accelerate the current labor-intensive industries upgrading; at the same time, support the big enterprises with the support of the state, and foster long-term strategic industries with independent intellectual property rights.