Sang Baichuan: Promote enterprises to actively respond to the restructuring of global value chains
(Source: "Guangming Daily" Date:2016Year3month24日 16version)
Currently, the global value chain is being restructured under the leadership of multinational corporations, which has brought new challenges to our economy. Chinese companies should actively participate in it and continuously improve their status in the global value chain.
Restructuring of the global value chain is a salient feature of the current world economy
In recent years, the world economy has begun to gradually recover from the severe damage caused by the international financial crisis, but the recovery is still unstable, uneven, and not strong. In particular, emerging market countries have encountered structural resistance and their growth rates have declined significantly. Overall, the trend of restructuring the global value chain has become more obvious.
First, the transformation of multinational companies into global companies is the basic motivation for the formation and reconstruction of global value chains.20century90Since the 1990s, multinational companies have broken through national geographical boundaries, deployed major links in the value chain globally, absorbed and integrated high-quality resources, and greatly enhanced the core competitiveness of enterprises. A large number of multinational companies account for more than half of their overseas assets, overseas employees, and overseas sales. The resulting corporate value chain extends around the world to form a global value chain.2008Since the outbreak of the international financial crisis in 2019, the world's economic recovery has been sluggish, and multinational companies have faced more intense competition amid the crisis of tight demand, prompting them to further reduce costs, rediscover value lowlands globally, and reconstruct the global value chain.
Second, the adjustment of industrial policies in major countries is the driving factor for the restructuring of the global value chain. Developed countries such as Europe and the United States have proposed reindustrialization strategies to correct the hollowing out of real economy industries caused by excessive outsourcing of manufacturing, breaking the original division of labor in the global production system, causing high-end manufacturing to gradually return to developed countries. In order to avoid being locked at the low end of the value chain, emerging economies such as China and India are increasingly paying attention to scientific and technological investment and development, vigorously promoting industrial transformation and upgrading, and striving to move upstream of the global value chain. ASEAN and other emerging economies are further opening up, actively introducing preferential policies, undertaking international industrial transfers, and accelerating their integration into the processing and manufacturing links of the global value chain.
Third, developed countries are leading the changes in international economic and w88 rules and want to take the lead in the reconstruction of the global value chain. Trans-Pacific Strategic Economic Partnership Agreement (TPP), Transatlantic w88 and Investment Partnership Agreement (TTIP) and the Agreement on International w88 in Services (TISA) are committed to establishing a high-level w88 and investment liberalization rule system. These rules aim to strengthen the interests of multinational companies in intellectual property rights, service w88, and foreign investment, further extend the service value chain with competitive advantages to the world, and at the same time weaken the international competitive advantages of emerging economies. Although the new rules will not lead to my country being marginalized by the global value chain, they will undoubtedly increase the practical difficulty of moving upstream in the value chain.
Fourth, the restructuring of the global value chain has brought about the redistribution of global production by multinational companies. With the comprehensive and rapid development of the economy and society, the prices of various production factors continue to rise, and my country's advantage in production costs is gradually weakened. At the same time, the increasing purchasing power of residents has made my country a major consumer market in the world. Under this new situation, while multinational companies are transferring labor-intensive value links to my country's neighboring countries, they are also focusing on expanding investment to meet my country's market needs. This will inevitably lead to changes in my country's position in the global value chain. The global value chain structure of multinational companies is shifting from a "center-periphery" offshore production layout centered on the home country market to a near-shore production layout centered on the host country market.
Challenges and opportunities brought to our country by the restructuring of the global value chain
The challenges brought by the restructuring of the global value chain are self-evident. From an industrial perspective, my country is facing a double attack of "high-end blockade" and "low-end lock-in". In the high-end link, multinational companies have taken advantage of their dominance in international economic and w88 rules to continuously strengthen their competitive advantages, attract the return of high-end manufacturing industries, and strengthen the integration of the service value chain and the manufacturing value chain, making it more difficult for my country's industry to move up to the high end. In the low-end link, multinational companies have basically solidified their dominance in all links of the industrial chain. Most of my country's export products have low technological content and added value, and do not have the ability to dominate the value chain. From an enterprise level, my country's local multinational companies have just emerged and are still far behind global companies. The lack of micro-foundation support directly affects their right to speak in the reconstruction of the global value chain.
However, the restructuring of the global value chain also brings opportunities to our country. The new international economic and w88 rules take investment rules as the main content. Investment liberalization has developed in depth and the protection of cross-border investments has been continuously increased. This has created a period of strategic opportunities for Chinese enterprises to go global. Our country already has a number of large enterprise groups entering the world500The strong ranks have continuously accumulated ownership advantages, internalization advantages and location advantages. Some industries such as high-speed rail, nuclear power, telecommunications equipment, engineering equipment, and home appliances have low production costs, leading technologies, and reliable safety performance, and have increasingly become internationally advantageous production capabilities. In addition, my country’s national foreign exchange reserves are huge. If we can effectively seize the opportunity, build and improve a new open economic system, and actively integrate and upgrade our position in the global value chain, we should be able to effectively promote the transformation and upgrading of the economic structure.
Thoughts and suggestions on coping with the restructuring of the global value chain
As one of the most critical chains in the global economic cycle, occupying the core link of the value chain means controlling the flow of wealth throughout the value chain. In the future, global competition will be value chain competition. China should vigorously build its own global value chain, and then move from an economic power to an economic power.
First, promote enterprises to establish global development strategies and improve governance structures. Only by adapting to the requirements of development, changing business philosophy, adjusting governance structure, and making full use of high-quality resources such as global technology, management, capital, market, talent, and information can Chinese enterprises win in the international competition of global companies. It is necessary to rely on global resources to set up procurement centers, manufacturing and assembly centers, research and design centers, marketing centers, service centers and management centers around the world, and create a global value chain through outsourcing of certain links in the value chain or corporate mergers and acquisitions. It is also necessary to transform from center-and-spoke management to global network management. It is also necessary to transform from serving the interests of shareholders and maximizing shareholder interests to comprehensive responsibilities including shareholder responsibilities, global social responsibilities and environmental responsibilities.
The second is to promote the development of producer services through liberalization of service w88 and accelerate the creation of service value chains. The development and reconstruction of global value chains not only occurs in the production field, but also extends to the service field more broadly. If my country wants to improve its position in the global value chain, it cannot do without building a global service value chain. Judging from the experience of opening up the manufacturing industry, promoting the opening up of the service industry and the liberalization of service w88 will not only help to use international high-quality services to enhance the competitiveness of my country's manufacturing industry, but also help my country's service resources enter the international market, participate in the integration of global value chains, and benefit from the development of international w88 in services.
The third is to change the thinking of w88 and investment protectionism and promote the integration of enterprises into the global value chain. On the one hand, we should unswervingly improve the business environment, strengthen anti-monopoly, anti-corruption and intellectual property protection, create equal and fair institutional conditions for all types of enterprises, continue to promote the reform of the administrative management system and the investment and financing system, and fully implement the management model of pre-establishment national treatment and negative list for foreign investment; simplify administrative approval procedures, expand market access, attract all links in the global value chain, and promote Chinese enterprises to continuously improve their value chain status in cooperation and competition with multinational companies. On the other hand, finance, taxation, finance, insurance and other departments work together to support enterprises in "going global" to allocate resources in the global market and move towards the high end of the global value chain.
The fourth is to reform international w88 statistical methods and encourage enterprises to pursue export added value. Current international w88 statistics focus on the total value of imported and exported goods, which cannot reflect the global value chain and w88 value added, distorting the true w88 flow and international competitiveness. In view of this, it is necessary to strengthen cooperation with international organizations, actively participate in the formulation of international w88 statistical rules, and use w88 value-added accounting to make up for the shortcomings of the traditional w88 statistics system; guide enterprises to abandon the idea of simply pursuing export expansion and instead focus on their position in the global value chain and increase w88 value-added.
(Sang Baichuan, the author is the chief expert of the National Social Science Fund’s major project “Strategic Layout, Main Goals and Policies for my country’s New Round of Opening-up” and a professor at the w88 casino)
Attachment: Original report link
http://epaper.gmw.cn/gmrb/html/2016-03/24/nw.D110000gmrb_20160324_3-16.htm
