At the beginning of 2015 at the Lang Hampyeong Economic Lecture, the famous economist Lang Xianping once predicted that “the Chinese economy will be caught in the Great Depression in 2015.†Now that it is mid-August, let us take a look at the current status of China's manufacturing industry.
With well-known foreign companies such as Panasonic and Sharp further advancing their manufacturing bases to relocate to Japan, well-known Foxconn, Samsung and other companies have also accelerated their withdrawal from China and have turned off factories in China to Vietnam and India. As far as Dongguan is concerned, it can be said that the manufacturing industry seems to be stuck in the domino effect of closing down, and hundreds of companies are closed.
Why does this happen? China is not a big manufacturing country. Isn't Dongguan also known for manufacturing? Lang Xianping said that this was the root cause of the government’s measures in the financial crisis in 2008 and that the local debt burden was also a potential crisis. Then face this situation, how to solve the manufacturing crisis?
Lang Xianping said that the only way out for manufacturing is to do a highly efficient integration of the “6+1†industrial chain. If it is done, it will naturally break out in the Great Depression environment and widen the gap with competitors. The so-called "6+1" means "In addition to manufacturing, companies must integrate product design, raw material procurement, logistics and transportation, order processing, wholesale management, and terminal retail, and reduce costs through efficient integration." In fact, this is a popular point. It is said that manufacturing enterprises must have independent property rights and have the ability to innovate thinking. They can improve their own market competitiveness and survive in the market, from design to production and sales.
On the other hand, the withdrawal of foreign-funded enterprises is not entirely unfavorable. The reason why China's manufacturing industry has attracted so many foreign-invested companies to settle in, mainly because of the low cost of local Chinese labor, but most of these companies are low-end manufacturing. In the long run, the impact is not great, but as far as 2015 is concerned, the impact on the Chinese economy cannot be ignored. At present, the Chinese economy is in a state of difficulty. If foreign companies are withdrawn in large numbers, they will have a new impact on the Chinese economy. Therefore, the status quo of China's manufacturing industry in 2015 is that the manufacturing industry has entered a real test period, and the country must focus its strategy on revitalizing the manufacturing industry.
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