Breakout Of Ningbo's Manufacturing Overseas Market

With the high output base in 2010 and the complex economic situation in 2011, Ningbo's industrial economy has maintained a relatively rapid growth. But growth is also troubled, especially global. financial crisis It does not see the end of the raging and spreading, which makes this growth more painful and tortured.

Data show that China's manufacturing industry is facing unprecedented pressure in the "recession". As a pioneer of China's manufacturing industry, the development of manufacturing industry in Ningbo is also the case -- endogenous power shortage, rising business costs, Industrial Hollowing, competition and challenges from multinational companies and so on.

Where is Ningbo's manufacturing industry?

Market economy is the "initiative" economy. It will benefit from the initiative sooner rather than later. Therefore, Ningbo's manufacturing industry can only learn to create its own way and opportunity.

Highly developed manufacturing industry It is an important symbol to measure the comprehensive strength and modernization level of a region. Manufacturing industry has always been a pillar industry of Ningbo's economy and an important force in creating Ningbo's wealth.

After more than 30 years of rapid development, today's manufacturing industry in Ningbo has gradually got rid of the past "low, small and scattered" development mode and embarked on the industrial development path of agglomeration, forming three major industrial clusters, namely, traditional manufacturing industry, port manufacturing industry and high-tech industry. According to statistics, in 2011, the total industrial output value of Ningbo reached 15390 billion yuan, and the total industrial added value was 300 billion 480 million yuan, and the total industrial economy reached a new level. Among them, the total output value of industrial products above Designated Size reached 11848 billion yuan, an increase of 17.9% over the previous year, and the added value of industrial added value above designated size was 238 billion 130 million yuan, ranking first in Zhejiang Province, an increase of 12.2% over the previous year, which was 1.3 percentage points higher than the average growth rate of Zhejiang.

With the high output base in 2010 and the complex economic situation in 2011, Ningbo's industrial economy has maintained a relatively rapid growth. These seemingly boring data are the best proof of the strength and potential of manufacturing enterprises in Ningbo.

But growth also has worries about growth, especially when the global financial crisis does not end up in raging and spreading.

　　 Pulse manufacturing industry in Ningbo

Economic weakness has become a global reality, and there is no solution yet. The global economic crisis, coupled with the rising prices of raw materials, the rising cost of labor and the shortage of land resources, has made the long term "low cost advantage" of China's manufacturing industry increasingly disappearing.

The purchasing managers' index (PMI) of China's manufacturing industry released by the National Bureau of statistics in August was 49.2%, down 0.9 percentage points from July. 50% is usually considered a critical point, which is higher than 50% when the manufacturing economy is expanding. Below 50% reflects the contraction of the manufacturing economy. This index further indicates that China's manufacturing industry is under unprecedented pressure in the "recession".

The more we go ahead, the more obstacles we have. This is also true of the development of Ningbo's manufacturing industry as a pioneer in China. According to the statistics of the Ningbo Municipal Commission of information, since 2006, Ningbo City Industrial investment growth showed a wide range of shocks. Because of the decline in corporate profits, the growth rate of investment in enterprises was very unstable.

On the whole, the current "difficulty" of manufacturing industry in Ningbo is constrained by both internal and external constraints.

{page_break}

At present, the competitiveness of Ningbo's manufacturing industry is still concentrated in labor-intensive industries, and endogenous driving force is obviously insufficient. Such as agricultural and non-staple food processing, textile industry, printing industry, culture, education and sports goods, textile and clothing, shoes, cap manufacturing, etc. The innovation ability of manufacturing enterprises in Ningbo, such as technological innovation, management innovation, system innovation and so on, still lacks competitiveness on the global platform. At the same time, it is difficult to attract talents and make use of them, so it is difficult for manufacturing enterprises to keep up with strategic needs.

The competitiveness of Ningbo's manufacturing industry has always been short board, and the external environment has made these short boards more obvious.

In recent years, interest rate, exchange rate, tax rate, rate "four rates", salaries, rents, land transfer payments "three gold", raw material purchase price and resource and environment cost "two price" and other factors superimpose, promote enterprise cost rise, especially human cost and financing cost. According to statistics of Ningbo Development Planning Institute, labor remuneration increased by 18.1% in Ningbo last year. Because small and medium enterprises loans to banks are not only high interest rates and difficult, some small and micro enterprises can only turn to private lending, resulting in a significant increase in their financing costs.

Industrial Hollowing is also becoming a worry for the economically developed eastern region. With the increase of investment in central and western regions and the improvement of investment environment, a large number of manufacturing enterprises which are restricted by factors in Ningbo have chosen to move out. According to incomplete statistics, at present, more than 10 thousand private enterprises in Ningbo have invested in the central and western regions, with a total investment of nearly 120 billion yuan.

The weakness of the domestic consumer market and the lack of the ability to develop enterprises make manufacturing enterprises still unable to seize the opportunities. At the same time, the acceleration of economic globalization also makes Ningbo manufacturing enterprises directly face the competition and challenges of multinational companies, because the Chinese market is also the market of "foreign giants".

The danger of crisis has spread to all walks of life, but first in manufacturing.

I complained for many years and waited for many years. Looking back, complaining and waiting can not solve any difficulty. Market economy is the "initiative" economy. It will benefit from the initiative sooner rather than later. Ningbo's manufacturing industry can only learn to create its own way and opportunity.

　 Breakthrough in overseas markets

In the second half of this year, the leading enterprises in China's manufacturing industry set off a new wave of overseas investment. In September, Lenovo first announced the acquisition of CCE, one of the largest manufacturers of consumer electronics in Brazil for $148 million, and then Haier confirmed that it would buy New Zealand's largest appliance maker Fisher Parker for 3 billion 600 million yuan. HUAWEI then announced that it will invest 1 billion 300 million pounds to expand its investment in the UK.

However, this is only a few big guys standing at the top of China's manufacturing industry. This does not represent the majority of China's manufacturing.

As a big manufacturing country with small and medium sized enterprises as the main body and foreign trade dependency ratio of more than 60%, China is in the "deceleration shift" period of foreign trade. The general recognition of the industry is that the global economy will go through a slow growth for a long period of time. China's export market space will also suffer from two sides "attack" from developed countries and developing countries. According to customs data, following the sharp decline in China's export growth in July, the growth rate in August increased from only 1% to 2.7%, and the increase in imports and exports was only 0.2%. China's Ministry of Commerce predicts that the foreign trade situation will be more severe in the coming months.

Ningbo is a big foreign trade market. In 2012, Ningbo's manufacturing export road was full of brambles.

{page_break}

In the first half of this year, Ningbo's foreign trade temporarily increased its two digit growth rate. The growth rate of import and export volume was only 1% year-on-year, showing a low growth pattern. Ningbo's electronics manufacturing industry above Designated Size realized export delivery value of 26 billion 254 million yuan in the 1-6 months of this year, a negative growth of 32.3% over the same period last year, and a big decline compared with the growth rate of 5% during the same period last year. Although the export proportion of Ningbo mold is relatively low, but due to the declining import and export situation of Ningbo, some small and medium-sized enterprises are losing orders, and some middle and low end enterprises are in the predicament of production.

The severe drop in EU market demand is one of the reasons for the limited export of Ningbo. The European Union is the largest export market in Ningbo, accounting for more than 1/4. In the 1-8 month of this year, the total volume of Ningbo's export to the EU market was US $10 billion 600 million, down 7.8% from the same period last year.

Technical barriers to trade which have long affected China's foreign trade also affect Ningbo's exports. Ningbo is affected by technical barriers to trade, including textiles and clothing, light industrial products, agricultural products (000061) and food and electrical and mechanical products, etc., involving the United States, Japan, Canada, South Korea and the European Union and other countries and regions. Technical barriers to trade have become a non-tariff barrier facing Ningbo's exports.

Ningbo international trade and Economic Cooperation Bureau of the international trade and Economic Research Institute pointed out that in 2012, the "bitter days" of Ningbo's foreign trade and economic cooperation may just begin.

Facing the increasingly complicated market environment, how should Ningbo make breakout overseas?

Figures show that the industrial output value of Industrial Enterprises above Designated Size in Ningbo reached 1 trillion and 160 billion 760 million yuan in 2011, an increase of 18.5% over the previous year. The export delivery value for the whole year was 268 billion 730 million yuan, an increase of 5.1% over the previous year.

The inspiration from the "flowers" in this "thorn bush" is that "hi tech" exports become the "fixed sea god needle" of Ningbo's foreign trade.

At present, more industrial entities take increasing investment in science and technology as the main starting point, and continuously enhance the competitiveness of the industrial economy through technological progress. Ningbo is China's clothing capital, mold capital, Stationery capital, and has a large share in household appliances, textile and clothing. Through the baptism of economic crisis and the constraints of productivity costs and labor costs, science and technology provide the most direct and rapid impetus for innovation. Ningbo manufacturing enterprises are making from "Ningbo" to "Ningbo intelligent manufacturing", strengthening independent technology research and development, building their own brands, and taking the road of "de localization" internationalization.

In 2011, expenditures for scientific and technological activities of Industrial Enterprises above Designated Size in Ningbo amounted to 13 billion 560 million yuan, up 27.8% over the same period last year. The production of new products continued to maintain rapid growth. In 2011, Ningbo's Industrial Enterprises above Designated Size finished 224 billion 240 million yuan in output value of new products, an increase of 25.1% over the same period last year, which is 7.2 percentage points higher than that of the same period. The output value of new products reached 18.9%, a new high in the year, 0.6 percentage points higher than the previous year. 37342 patents were granted in the city, an increase of 43.8% over the same period, including 1625 authorized patents, an increase of 34.4% over the same period last year.

Ningbo R & D investment continues to grow, and innovation capability is constantly improving.

When many foreign trade colleagues in the financial crisis lamented that business was becoming more and more difficult, Ningbo Guang Bo group started the first high level production line of ultrafine nano nickel powder in China. Then, high-tech products such as nano copper and nano compounds have been successfully developed and filled the gap in China. At present, there are 26 production lines of nanometer metal materials. The output of high-end nickel powder accounts for 15% of the world's similar products, and the products are exported to large international enterprises such as the United States, Japan and Korea.

{page_break}

Ningbo milieu Clothing Co., Ltd., located in Dong Qiao Town, Yinzhou, has contracted production lines this year, outsourcing all production to other enterprises, increasing design and research investment, enhancing product added value, and promoting brand. Chairman Zhao Chunhua said: "Millie" is involved in the animation industry, it is to rely on culture to create the brand. Today's market competition relies solely on the power of advertising. It is impossible for us to create an industry like "Disney" from "animation" to "clothing".

Crab has crab Road, shrimp has shrimp road. In the crisis, Ningbo has produced successful cases such as "international mergers and acquisitions" and "overseas copying", such as broad and Cixing shares (300307), and has also emerged a number of small and micro enterprises such as Ningbo natural sealing company and Futian group, which are scientific and technological innovation and occupy the commanding heights of technology. To the East is the sea, and the Ningbo people who are good at going to sea and dare to go to sea have been accelerating the pace of entering the international market by setting up factories overseas and opening up exclusive stores.

Crisis is not a dead end, nor is it the "2012" of Ningbo's manufacturing industry.

　　 To create confidence in manufacturing industry

The internal and external predicament makes some manufacturing enterprises in Ningbo increasingly in a state of small profits or no profits, and some even become unsustainable. The "no rush and hard to get rich" in the manufacturing industry has led to the social capital being "de real to virtual".

Confidence is more important than gold. This is especially true in manufacturing. For small and medium-sized enterprises suffering from "suffering", the government's assistance is important and urgent for confidence building.

The Ningbo municipal government, which regards private enterprises as a "people-oriented economy", has always had such a concept: a well-developed and solid entity economy is of great significance to providing jobs, improving people's livelihood, stimulating consumption, promoting domestic demand, stabilizing society, raising taxes, promoting social harmony and achieving sustained economic development. Manufacturing is an important part of the real economy. The government is duty bound to push forward the development of Ningbo's manufacturing industry.

Some experts pointed out that giving full play to the industrial advantages of the manufacturing industry is a major factor in realizing the great development of the manufacturing industry. Ningbo has gathered the basic advantages of manufacturing industry, and at the same time, we must enhance the competitiveness of the pillar manufacturing industry. Their development trend will directly affect the rise and fall of Ningbo's manufacturing industry. We should actively support and foster the industry of dominant growth, actively foster the growth industries, expand the scale of their industries, give full play to their competitive advantages, enhance the overall competitiveness of Ningbo's manufacturing industry, and vigorously develop new and high-tech industries and environmental protection industries, so as to enhance the development and technological support role of high-tech industries to Ningbo's manufacturing industry. In addition, we should give the largest policy discount space for resource saving and environment-friendly industries, such as waste resources and waste materials recycling processing industry, so as to speed up their development.

In order to encourage the development of Ningbo's manufacturing economy, the Ningbo Federation of industry and Commerce has conducted in-depth research on industrial enterprises and put forward relevant countermeasures and suggestions.

First, macroeconomic regulation and control policies, such as tax policy adjustments, make the profits of the virtual economy not too high, and raise the rate of return of the real economy through tax levers. We should create a market environment that makes hardworking and industry rich and innovating to become a big business.

Two, we must create a favorable environment for the development of the manufacturing industry, and give the system a new orientation, new development space and new investment channels. More support should be given to land security, market access, human resources, technological transformation, and tax concessions.

{page_break}

Three, we should further improve government services and improve all kinds of public service platforms. We should innovate the development mode, establish strategic cooperative partnership with universities, research institutes, trade associations, professional service organizations and enterprises, and gather high-quality resources to enhance the service level. Through the open laboratory, specialized equipment sharing and renting and other forms, to meet the development needs of small and medium-sized manufacturing enterprises. We should implement the way of "government support intermediaries, intermediary agencies to serve enterprises", through the proper support of financial funds, and adopt market-oriented operation to guide intermediary service organizations to carry out the service items needed by enterprises.

Ningbo Federation of industry and Commerce believes that although Ningbo manufacturing industry in the post financial crisis era is full of uncertainties, however, the survival of the fittest under the market mechanism will force Ningbo manufacturing enterprises to reshuffle again, and the harsh macroeconomic environment can force a new breakthrough in Ningbo's manufacturing industry.