Foreign trade: seeking long-term “stability” through quality “improvement”
Many companies that have experienced the golden period of foreign trade development are not adaptable or even difficult to accept the current downturn in the industry. Without exception, they are concerned about one question: Can the decline in foreign trade growth be stopped? “The fundamentals and long-term positive trend of my country’s foreign trade development have not changed, and we are confident that foreign trade will stabilize and improve.” Li Guanghui said.
From a policy perspective, a series of policies to promote the stabilization and improvement of foreign trade have been introduced recently, and the effects will gradually appear. From the perspective of industry fundamentals, foreign trade is also undergoing positive changes. Faced with low costs in emerging countries and strong brands in developed countries, only by improving supply can we win international orders and meet or even create more new demands for foreign trade
——There is still room for traditional advantages. Although costs such as land and labor have increased, traditional advantages have not completely disappeared, but are undergoing positive changes. For example, labor costs are changing from absolute advantages to comparative advantages, and from labor cost advantages to talent cost advantages.
The person in charge of a Japanese electronics company in Dongguan, Guangdong said frankly that compared with some Southeast Asian countries, the wage cost of Chinese workers is much higher. But if we combine the proficiency of workers, productivity, and costs such as water and electricity, and then allocate it to each product, China’s advantages are still relatively obvious. This is one of the main reasons why the company chose to stick to China after inspecting the Southeast Asian market.
——New growth points are gradually formed. The adjustment of my country’s foreign trade structure did not just start in the past two years, but has been going on for several years. New industries, new products, and new markets were developed in an orderly manner, and a number of new growth points for foreign trade were gradually formed. In 2015, the growth rate of cross-border e-commerce reached more than 30%, and the export growth rate of market procurement trade exceeded 70%. Beijing’s “Little Benniao” cross-border e-commerce export platform, launched in 2014, integrates multiple foreign platforms such as Amazon and eBay, making it easier for domestic manufacturers to sell products through these platforms. In just one year, Xiaobenniao’s export volume reached nearly US$400 million.
——The export structure has been significantly optimized. Export-led industries have transformed from traditional advantageous industries such as light industry and textiles to capital- and technology-intensive industries such as equipment manufacturing, and new advantages with technology, brand, quality, and service as core competitiveness have accelerated. Last year, my country’s exports of mechanical and electrical products increased by 0.1% year-on-year, and their proportion increased by 1.8 percentage points.
——Service trade will make up for shortcomings. Compared with the world’s largest trade in goods, trade in services is an outright shortcoming. Nowadays, this shortcoming is gradually being filled. The proportion of service trade in my country’s foreign trade increased from 10.3% in 2010 to 15.4% in 2015. In 2015, my country’s total service import and export volume reached US$713 billion, a year-on-year increase of 14.6%.
——The international share has steadily increased. Although the growth rate of foreign trade declined in 2015, my country’s total import and export volume ranked first in the world. The global share of exports increased to 13.8%, an increase of 1.5 percentage points. Compared with 2014, it increased by 0.6 percentage points from 2013, and from 2013 to 2012, it increased by 0.6 percentage points. The improvement speed is faster than before.
“Instead of worrying about speed, it is better to focus more on quality.” Li Guanghui said that there have been many new changes in the development of foreign trade under the new normal, and it is obviously inappropriate to view and explain foreign trade from the old perspective. For the current foreign trade, taking subsidies and relying on preferential treatment may be able to achieve a temporary recovery, but it is not sustainable. In the past, we focused more on speed, but in the future we will focus more on quality. Only “improvement” in quality can ensure long-term “stability”.
“Some small foreign trade companies have a saying that if you don’t create a brand, you will die, if you create a brand, you will die. I don’t think so.” Huang Dezhong, the owner of an audio production company in Guangdong, said that many small businesses feel that the investment in creating a brand is too high. Can’t play at all. actually not. In the German foreign trade industry, many small businesses with only a few dozen employees hold high-quality brands that are well-known around the world. As a small business, it is better to work hard and rely on our brand to obtain more orders with high return rates than to wait. Last year, the company launched a self-developed, self-branded wireless audio equipment with profits that are more than ten times higher than those of OEMs.
Beijing iSoftStone Information Technology (Group) Co., Ltd. focuses on smart cities and industrial Internet, providing information technology outsourcing services. “In the past, we competed on price, and in the future we compete on technology.” Chairman Liu Tianwen said that the previous development opportunities for my country’s service outsourcing were more about the transfer of international service outsourcing business to China under the cost advantage. In the future, Chinese service outsourcing companies will rely on their technological advantages to move to the high end of the industrial chain, such as targeting high value-added businesses such as consulting and industry solutions.
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