Heavy Pressure On Export Manufacturing Industry: The Situation Of Foreign Trade Is Changing.

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Grim, continue to become the theme of this year's China's foreign trade situation.

Zhang Xiaoqiang, deputy director of the national development and Reform Commission, said in January 14th that the target of foreign trade growth in 2012 was about 10%, while that figure in 2011 was 22.5%.

"Taking into account the two factors of inflation and appreciation of the renminbi, the amplification effect of the 2011 data, and the expected goal of 2012 is more severe than that?" Wang Jun, a researcher at the China International Economic Exchange Center, clearly believes that the situation is more serious.

In 2011, the growth rate of imports and exports was "high before and after low". In December, the growth rate slowed to a peak. Both imports and exports hit a new low for two years. This trend further narrowed the trade surplus to $155 billion 140 million last year.

This is the three consecutive decline in China's trade surplus. The balance is the lowest since 2006, and according to a number of research institutes, the trade surplus will continue to decline in 2012.

Lu Ting, China's chief economist of Merrill Lynch and Merrill Lynch, said in an interview on January 13th that the relationship between exports in 2012 and related tax policies was relatively large, and imports were related to domestic investment. These two items are hard to come to a conclusion at present.

At the micro level of enterprise or industry, the downward trend of export industry centered on manufacturing industry has long been established and will enter the second stage of "self rescue".

Chen Xiangyou, executive vice president and Secretary General of Dongguan Toy Association, told reporters in January 14th that "from 2008 to now, external demand is sluggish, and domestic demand is far from the horizon. How to save ourselves and the road ahead is boundless."

Dongguan is known as the "toy city of the world", and toys are one of its eight pillar industries.

Information from the Dongguan Bureau of economic and information technology shows that China has produced 75% of the world's toys, Guangdong has produced 70% of China's toys, and Dongguan has produced 60% of Guangdong's toys.

Since 2008, the toy industry in Dongguan has been largely bankrupt due to the financial crisis.

Statistics of Dongguan economic and Information Bureau show that fewer than 500 foreign toy enterprises are in the register.

But Chen Xiangyou believes that the total number of toy enterprises (including domestic and foreign investment) in Dongguan with an annual output value of over 100 million yuan should not exceed 350.

"However, by the middle of 2011, the failure of toy enterprises has been heard little."

Chen Xiangyou said that Dongguan's toy enterprises had come through the internal adjustment methods such as closing factories until the outbreak of the European debt crisis. Despite the tragic ending, the fruits still remained, and the dominant position in the domestic market and sales ability in the European and American markets "remained at a reasonable level of profit."

Now, orders for toys, gifts, shoes and hats, bags and other manufacturing enterprises in Dongguan have dropped greatly, but they can still maintain start-up and profit.

However, long term orders dropped sharply. "The number of orders for some toy leading enterprises is only half that at the end of 2007"; short term orders often come late and go fast.

Some toy enterprises are mainly short-term orders, and the fourth quarter since 2010 is basically a reduction in production.

What is interesting is that in the main toy town of Houjie and Humen in Dongguan, a lot of new toy factories began to open in the middle of 2011.

After in-depth interviews with financial and economic weekly, it is found that these newly built toy factories are often composed of dozens of fellow townsman or former toy factory colleagues, who are leasing or buying a small number of equipment to start production.

Because of its smaller scale, it is happy to accept short-term orders.

Liang Jingchang, deputy director of the Dongguan Municipal Bureau of letters, believes that this phenomenon has already appeared in industries such as gifts, shoes and hats, bags, and even small electrical and mechanical equipment. The government is also pleased to see that it has contributed to solving the problem of employment and contributing to local finance and taxation.

As for its future development space, it is difficult to judge, "they are now through the big factory instead of directly facing the European and American customers. How far we can go is a problem."

According to Lu Ting's analysis, the phenomenon of large and small industrial clusters is still in progress.

The traditional advantage of China's manufacturing industry is to find space for low labor costs, and its sustainability is not optimistic.

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For these processing and manufacturing enterprises which are guided by foreign trade only, there is still room for buffer for workers' wages.

The cost pressure of exchange rate and interest rate became more practical in 2012.

"The recent devaluation of the RMB has a short-term support effect on exports, but in the long run, it needs to be combined."

Zhang Monan, an Associate Research Fellow of the Forecast Department of the State Information Center (micro-blog), said in an interview with this reporter that in 2012, the issue of RMB exchange rate and accompanying trade protection would be more severe than that in 2011.

In Dongguan, most export processing industries are paid in dollars and Hong Kong dollars, but wages, rents, utilities and other costs are spent on Renminbi.

In 2011, the appreciation of RMB against the US dollar was 5.1%, coupled with the amplification of inflation, the competitive advantage of these enterprises was greatly weakened.

Dongguan Peng run mechanical and Electrical Equipment Co., Ltd. is a large company that produces heat pfer printing machinery. It can be called the benchmark of Dongguan industry.

Chen Renli, assistant general manager, told the finance and economics weekly that the company mainly imported raw materials from Japan. In 2011, the cost of the US dollar increased by 23% because of the US dollar settlement. At the same time, the cost of the European market could not be pferred.

Wang Dongming, director of the International Trade Department of Harbin Boiler Works Co., Ltd., which is the export of mechanical and electrical equipment, said that compared with competitors such as Japan and Japan, the price of Chinese export enterprises was greatly affected by the exchange rate.

"In order to strengthen exports and let the Korean won depreciate, the price of the products dropped suddenly.

It is suggested that the central government should fight for and carry on the exchange rate negotiations with the United States. "

The domestic policies associated with exchange rate also form constraints on such export enterprises.

Taking large mechanical and electrical equipment as an example, its contract period is generally 3-4 years and cannot be settled in cash. It is necessary to hedge operation to avoid exchange rate risk.

"However, domestic banks have limited means and service capabilities under the current monetary policy."

Wang Dongming said.

Chen Renli said that since 2008, they mainly carried out spot settlement, but the domestic demand for foreign exchange was forced to sell foreign exchange. The amount allocated by the central bank to Dongguan was limited. The stumbling block in the foreign exchange settlement process directly led to the loss that could not be overlooked.

"What is most urgent now is that banks can put money out."

Chen Xiangyou and Chen Renli think this is especially important for small and medium-sized enterprises in manufacturing industry.

In Chen Xiangyou's view, since the outbreak of the financial crisis in 2008, there has been a worsening trend for enterprises, rather than external markets, but trade finance.

"First, banks and insurance institutions in Europe and the United States were no longer affected by the financial crisis and issued letters of guarantee or letters of credit for export enterprises. Then, domestic banks no longer made trade financing for export enterprises. By 2011, small and medium-sized enterprises in manufacturing industry, regardless of your past credit records, had almost completely stopped production credit."

Such complaints, which are placed on Liang Jingchang's desk and from enterprises or trade associations, are no longer counted.

Generally speaking, it also involves adjustment of deposit reserve ratio, adjustment of export tax rebate policy and so on.

Liang Jingchang told this reporter that "the right to decide these policies is still in the central government, and local governments can only try to reflect them repeatedly and as a limited space."

But in Wang Dongming and Chen Renli's view, the local government's space is very large, concentrating on the adjustment of industrial policies, especially in Dongguan, which has already grasped the global discourse power of some industries.

Dongguan has export processing machinery and electrical equipment manufacturers over 1500.

The current market of these enterprises has shifted from Europe and America to emerging markets such as the Middle East and India.

In these markets, they meet not only Japanese, Korean enterprises, but also local counterparts from Dongguan.

"In bidding, if we lose to Japanese and Korean enterprises, we are basically convinced, because sometimes the quality of products and software services are sometimes better than ours.

But the problem is that we often lose to Dongguan or the PRD enterprises, and the opponent's killer is to mix the sand behind and compete in price.

Chen Renli was puzzled about this.

Wang Dongming also encountered similar situations in the professional boiler export market.

"In the tender stage, some colleagues entered, but he did not quote, only watch the war.

Other colleagues have completed the contract is about to sign a contract, he stabbed you behind the knife, discount 5% and you compete, the results can be imagined.

"Such a vicious competition, the quality of products or engineering is difficult to guarantee, and the result is often the destruction of Chinese made brand and reputation."

Under such circumstances, the space that the government can make is that Wang Dongming suggested that "the foreign trade enterprises going abroad should be bound by the statutes of domestic laws or industrial associations, rather than being indifferent to such vicious competition."

Chen Xiangyou told this reporter that after the baptism of the financial crisis, the Dongguan Toy Association has actually regulated the vicious competition situation through the statutes of industry associations.

However, the departments concerned did not seem to realize the adjustment of such industrial policies.

According to Wang Jun analysis, 24.9% of China's import growth last year was mainly used to expand the already hot investments, such as equipment manufacturing and electromechanical manufacturing.

"The overcapacity caused by this situation will be very obvious, and excess capacity will inevitably lead to vicious competition."

All the industry associations that should be committed to the interests of the industry and the lack of serious industrial policy formulation in China.

Liang Jingchang, who endorsed the local economy, believes that it is urgent to see whether the export tax rebate policy of several major industries in the country can remain basically stable in 2012.