This is the 1046th original article by Panda Babe:
The undercurrent of the surging power industry game, in 2022, can be described as unprecedented fierce and hot.
A large number of factories have moved to Vietnam, and the Indian economy has fully recovered, and has recently become a hot content and topic for many domestic economic media and overseas intermediaries.
In fact, this is a very normal thing, feng shui turns, large countries and small countries have a cycle of national fortunes, who does not eat a dumpling in the New Year?
But in the big picture, there is no harm without comparison:
Europe and Eurasia, torn apart by the Russo-Ukrainian war, are embarrassed under the pressure of energy inflation;
The United States, which is torn apart in internal affairs and partisan splurge, faces the double squeeze of domestic inflation and the decline of dollar hegemony;
Even China, which is linked to every Chinese, since the beginning of 2022, the economy has been under pressure, the impact of the epidemic, and many difficulties...
Similar to the recovery and rebound in the original epidemic-hit areas such as Vietnam and India, especially in industry, the momentum of overall strong growth of the industry is very eye-catching and gimmicky.
This has also triggered anxiety and uneasiness among some groups in China, and the more extreme and negative views are that Vietnam is about to rise, seize China's position as a global manufacturing plant, and what India will take off will eventually become an obstacle to China's economic rise.
Is that actually the case?
Can only be said to be superficial and impetuous, no other word is more suitable to describe this mentality, typical rice bowl is robbed and think that the sky is falling short-sighted, although this is more straightforward and rude, but the words are not rough.
This article will be based on the in-depth and detailed analysis and cognition of the economic recovery and industrial migration of the two Southeast Asian countries around China since 2022, excavate the essence of the trend, see the inevitable law, and conduct in-depth analysis, research and thinking on the further rise and development direction of China in the global economic and industrial game environment.
With a rational and calm, objective and essential attitude and vision, to distinguish the causal relationship in the process of the current round of global industrial relocation and economic game, only by understanding some of the inevitability at the essential level can we talk about the future, in China, see the direction, see the trend, and see the opportunity.
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Ho Chi Minh City, Vietnam (Image source: Toutiao Gallery)
1
Three performances, causing China to be anxious about the "rise of Vietnam", but the vast majority of views are wrong about the key?
Since April 2022, a small Southeast Asian country has created a strong sense of crisis in many so-called economic slag and brick-and-mortar groups in China, and various advocacy and analysis have sprung up like mushrooms.
This country is Vietnam. The reasons that can attract the attention and discussion of Chinese public opinion are of course three very obvious signals or performances:
First, Li Ka-shing, a capital veteran representative known for "digging the bottom in advance and speculating on speculation", showed obvious interest in the country of Vietnam:
After the sale of Britain's hundreds of billions of assets, Li Ka-shing, who has a keen sense of business, turned his investment to Vietnam.
In April 2022, Li Ka-shing's flagship real estate flagship, Changshi Group (01113. HK) and Japan's Orix Group, through Vietnam's local partner WanSheng Fat Group, met with Vietnamese Mayor Of Ho Chi Minh City Pan Van Mai to discuss investment in Ho Chi Minh City.
The specifications are very high, the action is very large, and there are quite a lot of capital and old money that wants to bet heavily on the pomp and momentum of Vietnam's national fortune, which can't help but arouse the high attention and analysis in the investment field.
Second, in Vietnam's economic data released in April, there were many bright spots that sparked heated discussions:
As China's neighbor, whether it is the war of the last century or the current economy, Vietnam has learned from China all over again.
Vietnam's export data was US$72.2 billion in 2010, and it will grow to 336.2 billion in 2021, which shows that in more than 10 years, Vietnam has used exports to drive economic growth.
According to data released by the Vietnamese government, in the first quarter of 2022, Vietnam's GDP reached 92.175 billion US dollars, an increase of 5.03% year-on-year.
Even more impressive than GDP are trade figures. In the first quarter, Vietnam's total import and export of goods reached US$176.35 billion, an increase of 14.3% year-on-year. Exports reached US$88.58 billion, an increase of 12.9% year-on-year, which is equivalent to 12% of China's exports, 61% of Guangdong's and 90% of Jiangsu's in the same period. Among them, in the month of March alone, Vietnam's exports reached US$34.06 billion, an increase of 45.5% month-on-month compared with February and an increase of 14.8% over the same period last year.
Still need to be compared, the same is the first quarter of 2022:
In the troika of economic growth, Shenzhen's investment has maintained positive growth, while consumption and foreign trade have both declined.
In the first quarter, the total import and export volume of Shenzhen was 740.48 billion yuan, down 2.8% year-on-year. Among them, exports were 407.66 billion yuan, down 2.6%; imports were 332.82 billion yuan, down 3.1%.
At the same time, Vietnam's foreign trade hit a record high in the first quarter.
According to data released by Vietnam Customs, the total import and export of goods in Vietnam in the first quarter was 176.35 billion US dollars (about 1.15 trillion yuan), an increase of 14.4% year-on-year.
Among them, the export volume was 89.1 billion US dollars (584.2 billion yuan), an increase of 13.4% year-on-year.
In the global consumer goods, it can no longer be seen that it is made in China, and Vietnamese manufacturing has also entered people's eyes, and manufacturers of clothes such as Adidas, Nike, and hm have also moved to Vietnam. In addition, some electronic products such as Samsung, LG, intel and so on are also moving to Vietnam.
In 2022, vietnam's export orders have been scheduled for the third quarter, while China's foreign trade export orders are actually facing the risk and trend of default refunds.
In this regard, Vietnam's foreign trade catching up with Shenzhen is not a lie.
Third, it is a comparison of financial markets, which is more heart-wrenching:
In April 2022, when China's stock market was still hovering at 3,000 points, Vietnam's stock market came out of a surprising increase.
400 points in 2012, the highest point in 2022 is more than 1500 points, an increase of nearly three times, and the Chinese stock market has lasted for 10 years 3000 points, this kind of capital and economic real money and silver vane comparison, can not help but make Chinese investors feel uncomfortable, right?
Capital favors the pile, the export economy is bright, the financial market is strong, and then the industrial migration trend that is visible to the naked eye can certainly bring a gap feeling and pressure to many people in China who are still fighting against the epidemic and the economy is under pressure.
But the focus is wrong, do not blow black, Vietnam, a country with a population of 96 million and an area of 320,000 square kilometers, even if the sparrow becomes a phoenix, the salted fish turns over, at best, it is the level of the volume and scale of a provincial economy in China, and it is really bullying to take the lower limit of China's economy to benchmark the upper limit of Vietnam.
Vietnam's rise, the trend has become, but the impact is not China's coastal developed Pearl River Delta and Yangtze River Delta, but in the central and western parts of China, those who are waiting to be fed, the construction of a large number of industrial parks and factories, in order to undertake the transfer of coastal industries, to achieve the central city of urban economic transformation and upgrading, such as Henan Zhengzhou, such as Nanning, Guangxi, and for example, Hunan Hubei Jiangxi and other provinces of the central cities, these hope to achieve the rise of the central and western cities by undertaking industrial migration, has been staring at the low-end of the coast, low added value, Highly dependent on artificial resources, commonly known as sweatshop industry, as a result, it was cut off by Vietnam and robbed of its jobs by Vietnam.
Comparing Vietnam with China, it is too unconfident, advocating the rapid rise of Vietnam, and really the bones are too soft.
The key to looking at the problem is to see the enlightenment brought by the rise of Vietnam's economy and foreign trade, which has a real impact on China:
Why would the industry prefer to support the backward and economically underdeveloped Vietnam rather than migrate to the central and western parts of China?
This is a good question.
Hanoi, Vietnam (Image source: Toutiao Gallery)
2
Can India, which is invincible and has made a fortune in a muffled voice, become an economic game rival that truly deserves China's vigilance?
In 2022, India's performance as a country is very bright, especially in the economic dimension, compared with torn Europe, china under pressure, and large and small countries squeezed by global inflation, India's performance can definitely be said to be "the most beautiful boy in the global village".
- Compared with the core areas of global manufacturing such as East Asia and Southeast Asia, which are still repeatedly impacted by the epidemic, India has basically been unable to enter under the action of herd immunity and vaccines;
- Compared with Europe and Eurasia, torn apart by the Russo-Ukrainian war, India not only stayed out of the matter, but also used the special relationship between India and Russia to consolidate the long-term supply of energy and minerals;
- Compared with the United States, which is torn apart in internal affairs and partisan disputes, India's fiscal revenue has reached a record high under the strong rule of the Indian Party, and it has continuously introduced development-oriented industrial policies and trade policies, which not only made the import and export volume break through the bottleneck of many years to reach a new high, but also put into production for the first time High-end production capacity such as Apple IPhone13.
Image source: Network
According to the data of the first three quarters of the 2021-22 fiscal year, India's commodity exports exceeded 300 billion US dollars, and the export target of 400 billion US dollars is likely to be achieved in the whole fiscal year. At the same time, as exports expand and energy prices rise, India's imports of goods have risen to more than $440 billion.
At the same time, exports of services, which had been stalled for a long time before the epidemic, also achieved substantial growth, with India's services exports of about 180 billion yuan and service imports of about 100 billion yuan, according to data from the first three quarters of the fiscal year.
Image source: Network
The data speaks for itself, and it is possible to subvert the economic impression of many Chinese for the country of India, so that the economy and exports are thriving, or is it the magical and sparse country in the impression of the vast majority of Chinese?
More importantly, from the perspective of national sentiment, it is really difficult for India to let Chinese with strong patriotic feelings give a good face, especially the Sino-Indian border conflict in 2020, which makes China have a reason to resent India:
Image source: Network
India's economy and export trade, there has been a clear rebound and growth, is it worth China's vigilance and attention?
Will it bring threats, shocks, or even obstacles to the sustainable development and rise of China's economy in the future?
Any game, in the final analysis, must fall to the level of real interests, economic competition, worth thinking and analyzing.
After all, India is also a large working country with a population of 1.4 billion, and its age structure is superior to China's, but such ready-made advantages do not guarantee that India's ideal of a country that can shift to an East Asian-style investment-oriented economic growth model will be realized.
The core reasons are not complicated, two are enough,
One is the Long-term Fiscal Problems of the Indian Government, the Government's High Debt Model, and the first priority in making money is to maintain debt;
The other is India's institutional bottlenecks, local divisions, caste system, the gap between rich and poor, and low efficiency.
One is the economic model, the other is management capabilities, and there is no way to compare with China, let alone consumption and market, Australia tried to replace the Chinese market with the Indian market, and everyone knows the results.
But compared with Vietnam, India's economic rise and export growth are really worthy of vigilance and attention.
After all, something has come up on a scale, an order of magnitude, and once the core problem is solved, the energy that can be released is very considerable.
India and Vietnam are different, India's population base is on the table, the age advantage of the population, the management problems are also obvious, if you want to say that for the European and American countries the most ideal economic colony, a squeeze bottom, highly dependent on European and American currency India, far better than independent, constantly self-evolving and breakthrough China is much better.
Therefore, India's attitude as a country and its self-positioning and course in the future global situation are really potential risks of threat and impact for China. Although many things are not obvious at present, there is no need to be arrogant, once India rises, or because of the side (such as the Russian-Ukrainian conflict to support Russia) can eat the follow-up dividends of the new Cold War, once fully exerted, it is definitely worth vigilance.
New Delhi, India (Image source: Toutiao Gallery)
3
Starting from the law: the industrial chain moving out of Southeast Asia is not necessarily a bad thing
Back to China's point of view, in fact, the topic of industrial relocation has long become a common standard topic in the economic field in recent years, and in 2022, because vietnam and India, including Malaysia, the Philippines, etc. Southeast Asian countries have recovered their economic momentum and export trade has become stronger.
In fact, the matter of industrial relocation, with a rational and objective attitude, for the current China, is actually more beneficial than harmful, and it is also in line with the economic development logic and law of the global industrial division of labor system:
1. The migration of China's domestic labor-intensive (or so-called "low-end") industries to Southeast Asia is inevitable, and different industries have different problems sooner or later;
China's economic structure, demographic composition, including social consciousness, has reached the inevitable stage of upgrading from sweatshops, the role of the world's factories, to a higher dimension of the industrial chain.
Not the young people of this era would rather send takeaways to open didi than enter the factory to play screws, the essence of the labor shortage is the exploitation of the famine, the traditional set of surplus value exploitation model, there is no space in China, not only the problem of money, the original has no core competitiveness and added value of the sweatshop, can only use production capacity as a means to carry out thin profit vicious inner volume competition, business has no future, income has an upper limit, the future is not imagined, but also want to deceive the current young people?
Good and evil state-owned enterprises have support benefits, five insurances and one gold, how can private enterprises play?
The shrinkage of labor-intensive industries is inevitable, and some of these "shrinkage" means to disappear, and some mean to exoduse. The first choice for outflow is Southeast Asia.
Southeast Asia is lagging behind, all kinds of problems, but the core, or the low cost of labor, then the existence of sweatshops, there is a meaning.
The law of capital is like this, and the pursuit of profit is given priority.
2, environmental logic: rich Southeast Asia is more favorable to China than poor Southeast Asia;
Much of the concern about the relocation of domestic industrial chains to Southeast Asia revolves around the unemployment of local manufacturing workers. But if you look at it another way, in the medium to long term, Southeast Asia, which has become richer by undertaking China's industrial chain, is more beneficial to China than a poor Southeast Asia.
Because "affluence" means purchasing power, and purchasing power means that China's goods and services have a new market in addition to Europe and the United States.
While Southeast Asia is becoming richer, China's products, cultural creation and natural environment are constantly getting better.
This is inevitable, the previous high standards abroad, domestic counterfeiting, will produce a reversal, of course, the premise is that the status of China's economy can be achieved.
China's industrial upgrading and industrial migration to Southeast Asia are two sides of the same coin.
The simultaneous iteration of China and Southeast Asia is not only not a zero-sum game, but will make the whole of Asia better.
From a geopolitical point of view, this also makes it possible for Southeast Asia to form deeper cooperation with China and establish a closer relationship, which is particularly important in the coming era.
There are many friends, few enemies, and most importantly, the conditions of friends are good, and they will not be wrong.
International relations, interest considerations, are very important.
3, China's road: industrial upgrading and the sea of stars, need not only physical efforts, but also conceptual innovation.
The anxiety about the outflow of the domestic industrial chain in the current public opinion is essentially because China is currently in a very embarrassing stage of industrial development:
- The high-end industry climb has not yet been completed,
- The low-end industry has been stolen by emerging markets,
The risk of losing ground increases and is very difficult to deal with.
This kind of concern and emotion is actually normal and practical, but the situation is stronger than people, unless it can run ahead of the situation.
In fact, what we should see is the deep game between China's state system and human nature and capital, and in the dimension of development.
Taking new energy vehicles as an example, Tesla's entry into China is an important node.
Before Tesla entered China, what was the situation in China's new energy vehicle industry?
PPT car? State subsidy scammers? Mud can't hold up the wall? In short, no is no, it really can't work.
If there is a subsidy, it is alive, and if there is no subsidy, it is a dead fish, so realistic.
What about when Tesla comes in?
Even with the cancellation of government subsidies, China's domestic brands of new energy vehicles have ushered in a period of real growth, research and development, and healthy competition.
Is there any long-term benefit for industries and enterprises that are too big to fall, decaying and low-energy industries, forcibly staying in China, consuming the state's funds and hanging their lives, feeding a large group of zombie enterprises that can only rely on state finances and subsidies to survive, overcapacity, and industries and enterprises that do not want to make progress?
No, but like cancer, greedily sucks up the wealth of the nation, eventually creating systemic risks.
When the Ming Dynasty collapsed, the wealth of the state, the huge amount of real money and silver, was in the basement and secret room of the rich merchants and squires in Jiangnan of the Donglin Party, and the state could not even get the grain and salaries issued to the army.
Long pain, or short pain? This may not be a difficult choice, but the difficulty is to face reality, acknowledge reality, and accept reality.
Many parasitic groups that originally had benefits, rice worm groups that do not want to make progress, can they not be in a hurry?
Polluting the environment, low value-added sweatshops, the corresponding employment population and output value are not false, but in the long run, it is inevitable that the gain will not be worth the loss.
China has also reached an important stage where it needs to make trade-offs in the industrial field.
Synthesizing the analysis of the above three dimensions, the road is simple, rational and objective, for China, the industrial chain has moved out of Southeast Asia, not necessarily a bad thing, more importantly, whether China itself can adapt to the law and break the cocoon and be reborn?
That's the key.
China's low-end industry assembly line (Image source: Headline Gallery)
4
Analysis of the future of China's rise of the sea of stars
From the perspective of China's development needs, if the future economic growth and the rise of international status want to be realized, we must cross an important threshold, that is, to solve the simple dependence on low value-added exports, and from the new dimensions of higher intellectual property rights, core technologies, high value-added industries and cores, etc., to achieve national revenue and profit growth.
This is the only way for all developed countries to achieve real development.
Exports are not an end in themselves, the normal cycle between supply and demand is.
If a country's domestic purchasing power is strong enough that domestic demand can absorb domestic supply, the importance of exports will be greatly reduced.
In the future, if China wants to become a more influential world power, it will definitely change from a big export country to a big import country. Huang Qifan has a very incisive discussion on this in "The New Pattern of International Trade in the New Era, New Characteristics and the Development Trend of FTAs Based on the "Three Zeros" Principle", which can be summarized into three points:
1. A big importer means that the market capacity is large enough to affect the world;
2. Large importers are often the pricekeepers of international trade;
3. The importing country either has a large amount of foreign reserves, or the local currency is the world currency.
What is the sea of stars in the future of China's economy?
That is to say, there is global pricing power, using technology and patents to obtain excess export surplus gains, just like the business logic of "seven hundred million shirts for an airplane" in the more than ten years after China joined the WTO, to achieve a perfect counterattack.
It is very realistic that in the future, China's high-end exports and low-end and low-value-added commodity consumption will be the real rise.
Correspondingly, China's industrial structure has been upgraded, scientific and technological breakthroughs have been made, and comprehensive national strength has been raised to a higher level.
The biggest threat is not the original labor-intensive industry relocation, but from the blockade of science and technology by European and American countries, and all the actions that want to put China at the bottom of the industrial chain out of fear of being surpassed.
The road to rise can never be smooth and smooth, but the direction is clear, although it is difficult, it is bound to move forward firmly.
Of course, the rise process requires costs, the current unemployment problem after the domestic industry moved to Southeast Asia, including capital outflow, these are in line with economic logic and law of the inevitable, of course, this is also the process of seeking rise and development, the national level must also think, face, and solve important issues.
Image source: Headline Gallery
Write at the end:
At the end of the article, I would like to think and discuss this issue with you:
Don't be arrogant, realistically speaking, how can China be regarded as a real big country in the future?
My personal opinion is self-confidence, self-reliance, self-improvement, and being needed by the world.
Self-confidence is the self-confidence of the economic and industrial dimensions, not afraid of challenges, not afraid of competition, core advantages, can not be replaced;
Self-reliance is truly self-contained, with me as the mainstay, and will not hinder its own development because of the stuck neck of other countries;
Self-improvement is the ability to create wealth and the ability to protect wealth, and such an ability comes from oneself rather than external forces.
The various difficulties, challenges and pressures facing China in 2022 precisely reflect the wisdom of breaking and standing, which is the key to China's future rise.
The relocation of low-end industries is a normal manifestation of China's economic upgrading and structural demand for upwards, which is an inevitable law and an inevitable process, of course, it is also a backward pressure and test for China to truly be in the core competitiveness of industry and science and technology.
The road to rise, is it expected to be achieved by lying down and letting others carry it?
What should be broken is to be broken, long pain is not as good as short pain, of course, this is not standing and talking without waist pain, why china's coastal manufacturing industry would rather run to the uncertainty-ridden Southeast Asian countries, can not go to the central and western regions, the northern region urgently needs to transform and economic growth of the city to achieve internal digestion? Isn't it bad for the meat to rot in the pot?
This, in fact, can explain a lot of problems, the choice and trend of real money and silver of capital, corresponding to the sufficient reasons and certainties of interest rate differentials.
The trend is always obvious, but there are always people who are unwilling to face reality, understand reality, and accept reality.
Here is China, the attitude of national will and top-level design, always above everything, and China, this country, has repeatedly proved in the past few decades, the combination of breaking and standing, cutting through thorns, constantly trying, and ultimately for China to surpass in catching up and break through in competition.
This has a very important enlightening significance and trend judgment value for all Chinese economic individuals and investment groups.
As for the extent to which I can see, it is not up to me to decide.
Finally, during the May Day holiday, as an ordinary young person in China, who is also a laborer, I wish all readers and friends a happy holiday!
Pressure is not terrible, difficulty is not a problem, if the future Chinese labor value can achieve a qualitative breakthrough, then all the current challenges and difficulties, looking back, will it still be a problem?
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Image source: Headline Gallery
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