What Hinders The Growth Of Guangdong'S Processing Trade?

Guangdong customs system has just submitted to Guangdong provincial government and General Administration of Customs a research report that in 1-6 months, the total import and export volume of Guangdong amounted to US $324 billion 510 million, accounting for 26.3% of the total import and export value of the same period.

However, 13.4% of the growth rate of imports and exports is lower than the national average of 26.3%, which is also lower than the growth rate of Jiangsu, Shanghai and Beijing 21.7%, 23.2% and 55.5%, which are ranked two to four in the country.

The slowdown in exports is particularly significant for this group of data.

In 1-6 months, Guangdong's export growth rate was only 13%, while the national export growth rate was 21.9%.

The compound effect of the superposition of national macroeconomic regulation and control and economic environment changes has a profound impact on Guangdong's foreign trade and economic cooperation. It is worth noting that after the report's investigation, the three types of enterprises, such as domestic capital, Hong Kong, Macao, Taiwan and foreign capital, are quite different, and some foreign-funded enterprises have benefited from this adjustment.

The report was just completed by Guangdong Customs after visiting 9 trade associations such as local economic and trade departments, foreign investment, and 22 representative enterprises.

This research is also aimed at matching the national foreign trade research conducted in June.

Domestic capital, Hong Kong capital and foreign investment are quite different, and the trade situation is depressed, making Guangdong export enterprises more differentiated.

The report said that the change of macroeconomic environment has a great impact on the export industry, foreign currency assets and the international pricing of products. "The survival environment of labor-intensive, low profit industries such as electronics, textiles, machinery and so on tends to deteriorate, and the competitiveness of domestic products, Korean capital, Taiwan funded enterprises and Hong Kong funded enterprises is affected."

Those who participated in the survey said that from the perspective of corporate feedback, the most influential ones were domestic funded enterprises, while Hong Kong funded and Taiwanese funded enterprises were in the middle, while European, American and Japanese enterprises were limited.

The report said that the "three rate and two price" (export tax rebate rate, exchange rate, interest rate, raw material prices and labor prices) frequently changed, increasing the export cost and unpredictable nature of enterprises, and uncertain factors made it difficult for enterprises to make quotations outside the market, and they dare not take longer than 3 months.

In addition, business orders are settled in the US dollar pactions, and the time between signing orders and receiving payments is relatively long. The exchange rate changes have caused huge losses to export oriented enterprises. Some enterprises have reflected RMB appreciation of 1% per unit, and the profit margin of enterprises will drop by 5% to 6%.

In order to keep the market, keep the customers and stabilize the staff, many enterprises have reluctantly maintained their exports. They have taken the way of reducing the scale, shortening the turnover period and a small amount of diversity, and "stayed through" the difficult period of this year.

In contrast, Canon, Flextronics, Weichang, Thyssen Krupp and other Japanese, American, and European funded multinational companies are limited by the superposition factors.

These companies say that because of the global allocation of resources within the group, mainly in the form of processing trade and export of electromechanical products, they are not very sensitive to the change of the export tax rebate rate; moreover, the original employment system of these enterprises is relatively standardized, focusing on employee protection, and that the implementation of the new labor contract law has little impact on them. Instead, after the implementation of the new law, these companies can have a more equitable competition environment, and have more competitive advantages than those that passively increase labor costs.

GREE electric (000651 market, love shares, information), Changhong appliances, Hansheng Technology (Asia's largest cable manufacturing enterprise) and other domestic enterprises also said that through vigorously developing less occupied land, less employment, research and development, brand, high-tech, and high efficiency industries, exports still maintained a good growth under the tight macro-economic situation.

In fact, in June, Pei Ke, chief operating officer of global resources for trade information providers, also said that China's high-quality suppliers benefited from the slowdown in the western economy.

He said that many buyers of electronic products increased their purchases of their own brand products, integrated small orders into large orders, and concentrated on sourcing from a small number of Chinese suppliers.

Ling Fangcai, chairman of the Guangdong textiles import and export Limited by Share Ltd, said that, considering the slowdown in the US economy, the group expected that its exports to the US would drop by 10%, but target, the second largest retailer in the United States, added large orders to the company. "We expect that the annual decline in US exports may be within 5%."

Ling Caice said that the deterioration of the trade environment may have knocked down some exporters, causing orders to concentrate on suppliers of relatively high quality.

However, the report also mentioned that the export volume of foreign-invested enterprises in the first half of this year has obviously slowed down.

In the 1-6 month of this year, foreign investment enterprises imported and exported 208 billion 80 million US dollars, an increase of 13.4%, accounting for 64.1% of the total value of Guangdong's imports and exports. Of them, exports were US $119 billion 920 million, an increase of 15%, accounting for 63.9% of Guangdong's total export value, with a net increase of 4 billion 830 million US dollars, accounting for 31.2% of the total net exports of the province.

"This shows that after the merger of domestic and foreign enterprise income tax, the income tax of foreign-funded enterprises has been raised, the operating cost has been raised, and the pace of import and export has slowed down."

The report said.

The core competitiveness of Guangdong's new and high technology exports has also been mentioned in the research report.

According to the report, the development of Guangdong's high-tech industry relies heavily on the industrial pfer of pnational corporations. The basic mode of product export is "foreign capital + processing trade", and technology, market and services are mostly in the hands of foreign investors.

In the 1-6 month of this year, foreign invested enterprises exported US $52 billion 440 million, accounting for 75.3% of the total value of Guangdong's high-tech exports, and processing trade exported US $57 billion 180 million, accounting for 82% of the total value of Guangdong's high-tech exports.

From the point of view of export earnings, the report said that the production of high and new technology products in Guangdong mostly concentrated on the labor-intensive processing and assembly links with less value-added. The technology diffusion effect of multinational corporations' production pfer was not obvious, the domestic industry substitution progress was not smooth, and the proportion of export products with independent intellectual property rights was relatively low.

"In some Sino foreign joint ventures, foreign businessmen actually invest only 30% capital, plus technology shares and so on, they can occupy 50% of the shares, and by collecting patent fees for each batch of products, we can get 70% of the actual profits of the enterprises, while we only undertake processing and assembling tasks, collecting a small amount of processing fees, but we need to consume a lot of energy and raw materials, and we have little profit and tax revenue."

The report said.

In recent years, although a large number of large integrated circuit enterprises have been established in Guangdong, the integrated circuit industry group has initially formed. However, due to the large number of orders to use foreign manufacturers IC, many enterprises do not know much about domestic IC, and so on, the integrated circuits and microelectronic components needed for production still rely mainly on imports.

Statistics show that in 1-6 months, Guangdong's integrated circuit, microelectronic components and LCD panels imported 31 billion 590 million US dollars, while exports were only US $4 billion 80 million, with a deficit of US $27 billion 510 million.

On the export of high-end frontier products, the export of electronic technology products in the month of 1-6 was only US $5 billion 980 million, accounting for 8.6% of Guangdong's high and new technology exports, while the export of life sciences products was only US $460 million, the export of materials and technology products was US $240 million, the export of biotechnology products was 3 million 119 thousand US dollars, and the export of aerospace technology products was US $67 million 169 thousand.

The report says that the current software outsourcing service in Guangdong is also mainly based on low-end code and simple application services, and the system software, high-end application software and service market are almost monopolized by multinational software enterprises.

From the perspective of import and export trade, Guangdong's foreign trade is still dominated by processing trade, accounting for about 60% of the total import and export volume and 40% of the total volume of processing trade.

Specifically, in the 1-6 months, general trade imports and exports reached 94 billion 680 million US dollars, an increase of 16%, accounting for 15.9% of the total trade import and export value of the whole country, accounting for 29.2% of Guangdong's imports and exports.

The import and export of processing trade reached 198 billion 370 million US dollars, an increase of 10.3%, accounting for 38.9% of the total import and export volume of the total processing trade, accounting for 61.1% of the total import and export value of Guangdong, indicating that Guangdong's trade structure was further optimized.

Guangdong's export slowdown is expected by the industry.

Zhou Shijian, a researcher with China's WTO Research Association, said that although the export situation is not optimistic this year, trade policies will tend to be stable and may even rebound. But in the long run, the adjustment of processing trade policy is far from over.

This research report shows that the pformation and upgrading of processing trade in Guangdong is a long process.

According to the report, although the provincial government of Guangdong province put forward the plan of building industrial pfer industrial parks in the Pearl River Delta and the mountains and East and West wings in 2004, the problem of uneven spatial distribution of processing trade in Guangdong is still outstanding.

In the 1-6 month of this year, the Pearl River Delta region, which accounts for 23% of the total area of Guangdong, accounts for 90.5% of the total import and export volume of Guangdong's processing trade, while the West and East wings and Guangdong mountain areas account for only 9.5% of the total value of the import and export trade of processing trade in Guangdong, which accounts for 77% of the total area of Guangdong.

Even in the Pearl River Delta region, the distribution of processing trade is also very uneven, forming a larger gap pattern from east to west. Among them, Shenzhen, Dongguan and other places concentrate more than 70% processing trade volume in the whole province.

Respondents generally said that in addition to tax incentives, hydropower and other factors, enterprises are more concerned about the industry supporting capacity, pport costs, logistics efficiency, government services, efficiency and other aspects of the comprehensive factors.

Multinational corporations also have to obey the global resource allocation strategy of headquarters group, so most of them take a cautious attitude towards industrial pfer.

In addition, even in the mainland, businesses tend to focus on domestic sales, labor intensive processing, or expansion of the new plant or branch plant in the mainland.

According to the report, the main structure of Guangdong enterprises is not reasonable enough, the proportion of foreign-funded enterprises is too high, and the proportion of domestic enterprises is low.

In 1-6 months, foreign investment enterprises accounted for 79.4% of the total value of Guangdong's processing trade import and export, while domestic enterprises accounted for only 20.6%.

"The reason for this is that the outward circulation of Guangdong's processing trade and the domestic industry's internal cycle are relatively fragmented, and the foreign investment enterprises are more like" tug of production "and" communitariality ". Most of the supporting enterprises are still the upper and lower home of the multinational companies, but they are pferred from abroad to the whole country. R & D, procurement and sales are basically not related to local enterprises, and the overflow effect of technology and management is limited.

The report said, "the participation of domestic enterprises is limited to product packaging and labor-intensive processing. The procurement of raw materials for high-tech products still relies mainly on import and pfer."

The above causes the value added level of Guangdong's processing trade is not very satisfactory.

Statistics show that the total export value of processing trade in Guangdong was 63.7% in 1-6 months, while the value-added rate of processing trade exports was 71.3% in the same period. The value-added rate of processing trade in Jiangsu, Shanghai, Tianjin and Shandong was 58.1%, 113.1%, 86% and 71.8% respectively.

According to the report, if the value of domestic procurement materials contained in exports is deducted, the actual value-added rate of Guangdong's processing trade will be even lower.

At present, more than 80% of the profits of shoe manufacturers in the PRD are only 5% to 8%, which is significantly different from the 200%-500% level in developed countries.

"A considerable number of processing trade enterprises are just manufacturing centers, not profit centers, even though the established R & D centers are only engaged in adaptive research and development such as process improvement and product trial production, independent R & D institutions are few and far from the real R & D center."

The report said.

In order to solve the challenges of Guangdong's trade, the report proposes that we should strive for a valuable pitional period for Guangdong's industrial pformation.