The US and Japan’s encouragement of companies to “move” is just a political gesture, and w88 online casino betting’s dominant position will be difficult to replace
(Source: Jiemian News 2020-04-18)
Tu Xinquan, Dean of the China World w88 Organization (WTO) Research Institute at the w88 casinopointed out that w88 online casino betting has the advantage of supporting the overall industrial chain, which is difficult to replace. w88 online casino betting is also very outstanding in terms of labor productivity and infrastructure construction. More importantly, w88 online casino betting has unique market advantages that can create economies of scale in the short term.
On August 23, 2019, workers were working on the lithium battery product production line in the production workshop of Lithium Dynamic Core New Energy Technology Park in Huaibei City, Anhui Province (Source: Oriental IC)
The sudden onset of the COVID-19 epidemic has dealt a serious blow to the manufacturing industry chain. Compared with developed countries, w88 online casino betting's manufacturing industry has been less affected by the epidemic, highlighting the advantages of the domestic supply chain. At the same time, politicians in some developed countries have begun to speak out, asking companies to accelerate the relocation of industrial chains out of w88 online casino betting.
Forbes magazine in the United States reported on April 10 that the Japanese government said it would provide financial subsidies for Japanese companies to move back to Japan from w88 online casino betting or to Southeast Asia. On the same day, when asked about how the United States can get rid of its over-reliance on w88 online casino betting, Kudlow, the economic adviser to the U.S. President, said that he personally prefers to provide "moving fees" to companies that intend to move out of w88 online casino betting to cover various expenses such as factories.
To this,Tu Xinquan, Dean of the China World w88 Organization (WTO) Research Institute at the w88 casinosaid that the so-called "moving expenses" proposed by US and Japanese politicians are more of a political gesture and are not very feasible.He pointed out that w88 online casino betting has the advantage of supporting the entire industrial chain, which is difficult to replace. w88 online casino betting is also very outstanding in terms of labor productivity and infrastructure construction. More importantly, w88 online casino betting has unique market advantages that can create economies of scale in the short term.
"w88 online casino betting is the world's largest consumer market, especially Chinese people who like to try new things. This means that w88 online casino betting can become the best experimental field for developing new products and promote the formation of economies of scale." Tu Xinquan said.He said that as w88 online casino betting's economy shifts from high-speed development to medium-speed and high-quality development, the economic structure is also constantly adjusting. In this process, due to rising labor costs, it is inevitable for companies to move out of w88 online casino betting for profit-seeking purposes. However, “The economic system is similar to human metabolism. It can be said that ‘if the old does not go away, the new will not come in’. Only when the ‘old’ goes away can resources be released to supply ‘new’ development.”
Tu Xinquan also pointed out that for the government, the most important thing is to ensure a fair business environment and attract new enterprises to settle in the city by continuously optimizing the business environment.
The following is the transcript of the interview, edited by Interface News.
Interface News: In recent years, the United States, Japan and other countries have been advocating "manufacturing reshoring." What is the effect?
Tu Xinquan: In fact, due to Sino-Japanese relations, Japan began to promote the reshoring of manufacturing industries very early. At that time, a number of Japanese companies did withdraw their investment from w88 online casino betting and returned to Japan or moved to Southeast Asia. However, in the past two years, some Japanese companies, especially those producing mid-to-high-end products, have returned to w88 online casino betting and increased investment in w88 online casino betting. One of the most important reasons for this is that w88 online casino betting's growing market and demand have attracted these companies back to w88 online casino betting.
The trend of "manufacturing reshoring" in the United States is mainly affected by the w88 war launched by Trump after he came to power. However, in general, even if American-owned and American companies withdraw from China, most of them will not return to the United States, but will move to Southeast Asia and other places. At least from the domestic situation in the United States, the proportion of manufacturing in the U.S. economy has not changed significantly.
Interface News: The shortage of medical supplies during the COVID-19 epidemic has made developed countries such as the United States and Europe realize the importance of manufacturing from top to bottom. At this time, the U.S. and Japanese governments have proposed "manufacturing reshoring" and even paid companies to leave w88 online casino betting. Will this policy be effective?
Tu Xinquan: I think this is a posture issue. Japan's policy may not be specifically aimed at w88 online casino betting. Japan is mainly considering the sudden impact of the new coronavirus epidemic in order to stabilize or ensure the safety of its supply chain. As for the United States, I don’t think we should pay too much attention to claims such as Kudlow’s suggestion of bearing “moving expenses” for companies.
In fact, the U.S. government has not yet figured out how to return manufacturing to its home country. One of the important reasons is that the public debt in the United States is currently high, and it is difficult to say how much money can actually be used to support the "relocation" of companies. Therefore, overall, this method of funding companies to transfer back to the United States is not feasible.
For the "manufacturing reshoring", the w88 war has a greater effect. As for whether to pay or not, it is just a sworn statement, and it does not mean that the United States will actually take any measures.
Interface News: Since the reform and opening up, w88 online casino betting has gradually become the "world's factory" because we have a cheap and hard-working labor force, and the prices of land, water, electricity, gas and other resources were also very cheap. However, with the rapid development of w88 online casino betting's economy, the costs of manpower, land, raw materials, etc. have not been as cheap as in the past in recent years. What advantages do we still have?
Tu Xinquan: The first is the advantage of labor productivity. The technical level and proficiency of our workers, the efficiency of logistics systems, financial systems and other aspects have been improved, which has led to an increase in labor productivity, so that the unit cost of enterprises will decrease, and cost is the primary factor that foreign-funded enterprises consider when they consider setting up factories.
w88 online casino betting also has the advantage of supporting the overall industrial chain. We have almost everything needed in every link of the entire industry chain. Take mobile phone production as an example. Why is mobile phone production concentrated in Shenzhen? It’s because Shenzhen has everything, even a screw can be prepared within a few hours. This supporting advantage of the overall industrial chain takes a long time to cultivate and is difficult to replace.
In addition, we also have infrastructure advantages, including government administrative capabilities, the quality of employees and labor, which are very rare.
The most important point is w88 online casino betting’s market advantage. w88 online casino betting is the world's largest consumer market, and Chinese people especially like to try new things. This means that w88 online casino betting can become the best experimental field for developing new products and promote the formation of economies of scale. Economies of scale can only be formed in countries and regions with large populations and large consumer markets. For example, if a new product is developed in Singapore and then sold locally, it is unlikely to form economies of scale. However, in w88 online casino betting, due to our huge consumer market, economies of scale can be formed quickly.
Jieme News: If companies want to leave w88 online casino betting in the future, what do you think are the main reasons? How can w88 online casino betting further attract foreign-invested enterprises?
Tu Xinquan: I think the departure of companies from w88 online casino betting is a process of adjustment of our economic structure. The economy is always a process of change. As w88 online casino betting's factor endowments and market positioning change, for example, the quality of the labor force improves, labor productivity improves, and labor costs rise, there will always be companies leaving. The economic system is similar to human metabolism. It can be said that "if the old does not go away, the new will not come in." Only when the "old" goes away can resources be released to provide for "new" development.
However, we hope that this process will not be too fast, but a gradual, healthy and virtuous cycle process. Only in this way can we adapt to the changing process of the entire economic factor endowment, market positioning, etc.
In addition, what is more important in this process is to create conditions to attract new companies. In terms of attracting new companies, a very important thing the government has to do is to ensure a fair business environment. In the past, foreign companies largely regarded w88 online casino betting as a production base, producing products in w88 online casino betting and then exporting them to third-party markets. In this case, foreign companies and Chinese companies were not in a competitive relationship to a large extent. But now the situation has changed. Foreign companies in w88 online casino betting are targeting the Chinese market, so they are in direct competition with Chinese companies. At this time, fairness has become particularly important.
Jie News: It is inevitable that the global industrial chain will be affected or even destroyed by the epidemic. What major changes do you expect will occur in the global industrial chain in the future?
Tu Xinquan: The disruption of the global industrial chain caused by the COVID-19 epidemic should be said to be a very extreme situation that has rarely occurred in the past. This has posed a new challenge to enterprises, that is, how to weigh the relationship between supply chain efficiency and supply chain security.
The reason why globalization is developing rapidly is because companies are chasing low costs around the world, or chasing high efficiency. They disperse production to multiple regions and countries based on cost, which is beneficial to their final costs. But now, the coronavirus pandemic has exposed the weaknesses of this decentralized production. For example, if a company only produces in two countries, production can resume as long as the epidemic situation in these two countries improves. However, if the company distributes production to 20 countries, it must wait until the epidemic situation in these 20 countries is completely controlled before production can be started.
From a business perspective, I think w88-offs and adjustments may indeed be needed in the future. Relatively speaking, a more realistic approach is for companies to shrink production to one country instead of being so dispersed. After the test of this epidemic, it can be seen that East Asian countries and Vietnam in Southeast Asia are better production destinations. In addition, the company's inventory strategy may also face adjustments. In the past, there was zero inventory in order to pursue efficiency. In the future, some inventory will need to be increased to deal with emergencies like the new crown epidemic.
Jie News: From the perspective of this epidemic, what are the shortcomings of w88 online casino betting’s manufacturing industry chain? How to make up for shortcomings in the future?
Tu Xinquan: In fact, this epidemic has exposed that our shortcomings in the industrial chain are mainly in the field of electronic products. The production of electronic products is too scattered. Chips, memory, etc. basically rely on Japan and South Korea. This situation is difficult to change in a short time.
However, compared with supply chain problems, our foreign w88 exports are currently facing greater problems, because the epidemic has impacted foreign market demand, so in the future we still need to consider more issues such as market diversification and East Asia integration.
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