What Is The Size And Influence Of China'S Industrial Clusters?

"China's powerful new specialized cities and towns are increasingly becoming the most suitable places for placing orders." the size and influence of China's industrial clusters actually surpass many people's imagination.

Here's just one example.

There are more than 80 toothbrush manufacturers and more than 1600 toothbrush related enterprises in the range of 36 square kilometers in Hangzhou town, Yangzhou, Jiangsu. More than 20 thousand people are engaged in work related to toothbrush production. Some enterprises, besides building their own brands, have also taken orders from foreign enterprises.

Large retailers and purchasers abroad have placed large quantities of orders in China's industrial clusters.

The New York Times has made such a report to China: "buyers from New York to Tokyo want to buy 500 thousand pairs of socks, 300 thousand ties, 100 thousand children's clothing, or 50 thousand 36B bras at one time."

China's powerful new specialized towns are becoming the most suitable place to place orders.

There, enterprises in clusters or networks provide raw materials and components, develop technology, and share the convenience of centralized supply centers.

For a long time, some protectionists in Europe and America have accused China of dumping goods to the world by squeezing cheap labour, subsidizing government and manipulating exchange rates.

But they can not see the cluster power that can increase efficiency and control costs in production.

The problem of corporate social responsibility in China's industrial clusters has been highly valued by the government and industry associations.

The China Textile Industry Association takes the lead in selecting hundreds of backbone enterprises in ten or so textile and garment clusters to set up a social responsibility management system for China's textile enterprises CSC9000T, and carries out social responsibility training for thousands of small and medium-sized textile and garment enterprises. Through self-discipline, it sets up a good image of enterprises and industries, creates a fair trade environment, and builds a responsible supply chain to achieve sustainable development of the industry.

In November 23, 2007, the national development and Reform Commission (NDRC) issued some opinions on promoting the development of industrial clusters (hereinafter referred to as "a number of opinions"), and put forward macroscopic opinions on the development of domestic industrial clusters in terms of independent innovation, producer services and industrial pfer.

The importance of this document lies in showing the central government's understanding and basic attitude towards the current industrial clusters.

The concept of fashion clusters and chaos is geographically concentrated in some areas, such as the American film industry in Hollywood and Italy, and the related businesses are geographically close and fully interactive. A large number of talents and technologies related to the industry will be released to a certain scale, which is Industrial Cluster, hereinafter referred to as "cluster".

The wealth of the world is mainly created in these specialized areas.

In specific industries, geographically concentrated interconnected companies and associated institutions are also common in developing countries.

According to our incomplete statistics on 15 provinces in China's coastal and central provinces, more than 500 enterprises in the same industry cluster are very specialized. There are numerous Dali aluminum profiles, Chencun flower, ancient town lighting, Yongkang scooter, Luo she piano, Anlu grain machine, Dafen Oil painting, Wang Qingtuo bicycle, Xindu furniture, Chenghai toys, TEDA microelectronics and so on.

This shows that enterprises benefit not only from internal efficiency, but also from the outside of the enterprise, so as to obtain external economies from agglomeration and thus reduce costs.

Within these clusters, suppliers and manufacturers are close, and the professional labor market is well-developed, which creates low cost through division and cooperation.

The division of labor between regions is becoming clearer. Men's shoes in Wenzhou, women's shoes in Chengdu, sports shoes in Jinjiang...

China's more than 20000 footwear enterprises are concentrated in the four largest footwear industry centers in Dongguan, Wenzhou, Jinjiang and Chengdu.

In Hangzhou City, Yangzhou, Jiangsu, large-scale toothbrush production has attracted related enterprises, such as Qiong Hua group, which produces PVC, and Shan Ying paper, which produces packaging materials. It also attracts the famous Guangxi enterprises nitidine production group which produces toothpaste.

The external economy has led to a reduction in costs, where the cost of a toothbrush is less than five cents.

Colgate, a multinational company, merged the toothbrush business of the three laugh group, put the world toothbrush production base in Hangzhou collection, which prompted the local toothbrush enterprises, such as five love, star, Jay et al, to continuously seek innovation, apply for a large number of patents, and promote the development of a large number of small businesses and even home court workshops.

Today, hang Ji toothbrush production accounts for 80% of the domestic market and 30% of the international market.

The toothbrush industry has also spawned a large number of enterprises engaged in the production of disposable tourist articles for hotels.

However, most of China's clusters are not based on innovative competitive advantages, but also from low cost comparative advantages.

But today, domestic clusters are becoming fashionable. The confusion of concepts is not only reflected in the confusion of innovative clusters and low cost clusters, but also with other concepts, such as specialized cities, special industrial sectors, industrial chains and industrial parks.

With the title of "cluster" appearing in the government's red headed documents and planning texts, some emphasize only the geographical proximity of enterprises, such as industrial parks; some only see the input-output relationship between enterprises, such as the industrial chain; others only stay in the simple understanding of industrial characteristics, such as specialized cities and special industrial sectors.

The cluster policy that aims to build industry chain may be a waste of resources because of the mismatch of goals and knowledge, and it is difficult to achieve the expected goal.

In the development of some clusters, there are many problems, such as lack of scientific planning, lack of independent innovation ability, imperfect social service system, serious environmental pollution and so on.

Successful clusters are often formed spontaneously, but it is also necessary for the government to actively guide and regulate the clusters.

In the coastal areas of China, the early stage of development is closely related to the support of local governments. For example, many enterprises such as three laughter, five love and stars in Hang Ji toothbrush enterprises were developed in the name of township and town collective enterprises in the early days.

Local government officials have actively created favorable development environment for these township enterprises.

Through the establishment of trading markets and trade fairs, local governments have expanded the sales channels of enterprises, attracted many upstream and downstream enterprises, and promoted the formation of local cluster brands.

In addition, the local government's technology and economic departments have also established common technology support platforms such as technology innovation centers in these specialized towns, which has effectively promoted the development of clusters.

Upgrading the cluster and getting rid of the advantages of the low-end location cluster of the value chain has attracted the attention of many leading departments and associations such as the national development and Reform Commission, the Ministry of science and technology, the Ministry of Commerce, the Ministry of information industry, the Ministry of culture, the China apparel industry Association and the China Jewelry Industry Association.

The cluster development strategy is being incorporated into the national and local industrial and technological development policies.

For example, the China Textile Industry Association has identified more than 100 textile and garment clusters, mainly clothing, such as Guangdong Humen casual wear, big wool weaving, uniform safety cowboy, salt step underwear, Fujian Shishi casual wear, Wenzhou men's wear in Zhejiang, Ningbo suits and so on.

The China Leather Association has identified 8 leather characteristics, including Wenzhou, Haining, Huadu (Shiling Town), Xinji, Tongxiang (Chong Fu town), Suning, Chengdu (Wuhou District), Chongqing Bishan, etc.

Shenzhen, Luohu, Guangzhou Panyu and other dozen professional jewelry processing towns also attracted the attention of China Jewelry Industry Association.

The torch center of the Ministry of science and technology in June 2007 identified 157 industrial bases and 50 pilot clusters.

In addition, some multinational companies also pay close attention to the impact of China's cluster on their decision-making.

In recent years, some provinces have put forward target, guidance and supporting policies for cluster development.

In 2004, Fujian issued the "opinions on accelerating industrial agglomeration to foster clusters". After that, it announced the "financial credit support for Fujian to accelerate industrial agglomeration, nurturing and developing clusters" notifications. In 2005, Guangdong issued the "guiding opinions on the construction of upgrading clusters in Guangdong province"; Hebei issued the "guiding opinions on accelerating the development of SME clusters"; in 2006, Hubei issued the "guidance on promoting the development of key growth clusters".

Clusters have also received the attention of the central level.

In 2005, the State Council issued several opinions on encouraging, supporting and guiding the development of private sector and other non-public sectors of the economy, referring to the need to "promote professional collaboration and cluster development".

To correctly and comprehensively apply the cluster development strategy in the national and regional industrial development policies, the most urgent task is to grasp the development trend of China's clusters from a macro perspective.

At present, China is mainly relying on reducing the cost of survival of the low-end cluster, which is conducive to global sourcing of multinational companies, but the role of domestic enterprises in improving the ability of independent innovation is not large.

If we do not pay attention to the upgrading of clusters, it will be very dangerous and will cause industrial recession.

In fact, those depressed old industrial areas are also industrial clusters, so they can not continue to build low end industrial clusters.

Two months ago, the national development and Reform Commission issued the "opinions on promoting the development of industrial clusters", which is objective and reasonable for the current situation of cluster development in China.

Since the reform and opening up, especially in recent years, the cluster has become an important form and carrier of regional economic development in China. However, most of the domestic clusters are still at the low end of the value chain, with low added value, lack of independent brands and innovative capabilities.

Therefore, independent innovation is a very urgent task for many clusters at this stage.

The suggestions put forward in some opinions are "promoting the traditional cluster to accelerate the pformation from OEM to independent design and processing (ODM), independent brand production (OBM)", "guiding enterprises to adopt advanced technology standards at home and abroad", "strengthening joint production, study and research" and "Combating counterfeit and pseudo inferior behavior".

Combined with these suggestions and local conditions, local governments can take or strengthen some measures, including improving intellectual property rights protection, establishing SME innovation fund, standardizing the technology trade market, setting up technology service centers and encouraging enterprises to learn from foreign enterprises.

In the development of producer services (producer service, also known as producer services), a number of opinions mainly emphasize the third party information platform, modern logistics system, vocational training institutions, and so on. For financial, consulting, law and other service industries do not emphasize, and whether such services can be developed is an important sign of whether the cluster is maturing.

Producer services are gradually evolving, rather than built out of thin air.

There is a widespread lack of intellectual property protection and excessive competition in the cluster, which leads to the urgent need for intellectual property protection services.

This is not mentioned in a number of opinions, and the deputy director of the national development and Reform Commission, vice president of new Europe, emphasized in the speech of the meeting of Ministers of small and medium enterprises in Asia and Europe that this is a key factor in the development of clusters.

In a number of opinions, industrial pfer is singled out and has a very strong realistic background.

Over the past few years, many enterprises in the coastal areas have been pferred to the central and western regions, and even pferred to Vietnam and other countries due to the constraints of land, energy and environment.

From the perspective of regional coordinated development, industrial pfer should be advocated.

Recently, the central government has also actively guided the industry to shift to the central and western regions through policies. For example, the Ministry of Commerce and the General Administration of Customs jointly issued the Announcement No. 44 in August 2007. The bank's margin account has been pferred to the restricted category commodities, and the difference policy has been implemented in the eastern and central and western regions.

"A number of opinions" also adopted an encouraging attitude towards industrial pfer, but especially emphasized the pollution problem in industrial pfer, "banning" two high and one capital "and the backward production capacity which has been explicitly prohibited.

In the actual process of industrial pfer, due to involving two or more areas, including relocation and relocation, the relevant governments should strengthen communication, coordination and cooperation, constantly innovate in the way of industrial pfer, and guide the pace and scale of industrial pfer. For example, the construction of "industrial pfer park" in Guangdong Province is a meaningful attempt.

So far, "a few opinions" is the most clear and systematic document put forward by the Central Committee for the cluster, which will have an important impact on the policies, regulations and plans of the various regions.

What should be seen is that many of our clusters are in the lowest processing link of the global procurement value chain, and are far from the way of innovative clusters.

After the introduction of a number of opinions, to enhance the competitiveness of clusters, local governments should not just make general planning, or simply convey the central policies.

This is the most critical issue in cluster development.