Looking back on this day many years from now, we are likely to sigh that today was the beginning of a radical change.
Because a new system may have arrived.
Throughout history, the rise of the new system has always followed the decline of the old system. The decline of the old system means the collapse of the old chain of interests, and it means that the new forces can begin to fill the vacuum of the old forces and thus arrange their own forces.
After the collapse of the Eastern Han system, Yuan Shao and Cao Cao began to dominate the north; After the collapse of the Sui Dynasty system, Li Yuan's father and son began to raise troops from Taiyuan; After the collapse of the Anglo-French colonial system, the United States and the USSR began to put their small hands into the Middle East and Africa ...
This law cannot be avoided in ancient times, in the present, in China and abroad.
Now that a new system with China at its core is emerging on the Eurasian continent, let's take a look at what is going on.
The loneliness of foreign companies
The outermost layer is the replacement of the old and new brand system: foreign brands are thinning day by day, and domestic brands are rising day by day.
In the apparel field, Adidas' China performance has declined for 7 consecutive quarters, and its old rival Nike is not much better, maintaining a 4-quarter decline. In sharp contrast, Anta's performance reached twice that of Adidas, and Xtep ushered in a round of 37.45% skyrocketing.
In the automotive field, the sales volume in the first quarter speaks for itself, with BYD beating Volkswagen, Honda and Toyota to become China's largest selling brands - this is the first time in China's decades-long automobile history that domestic brands have led the way
More special is the beauty and skin care field, "Estée Lauder", which has always been looked up to, began to dive, sales fell 12%, net profit fell 72%. For such a big setback, Estée Lauder officially gave an explanation: "Although Hainan's footfall exceeded last year's level, the passenger conversion rate was low, resulting in retailers consuming inventory at a slower than expected rate and fewer replenishment orders." ”
Translation: Although there are many tourists in Hainan duty-free shops, fewer people buy Estée Lauder, and the retailers' goods are smashed in their hands and do not want to order anymore.
Estée Lauder ended up attributing the Asia's failures to "the pandemic and the corresponding regulation." But the face is that in Asia, Estée Lauder's sales fell by only 1%, but in Europe, the Middle East and Africa, where there is little regulation, Estée Lauder fell directly by 26%.
Moreover, China's epidemic control measures have long been relaxed, and beauty and skin care products sold like never before in January and February 2023 - Hainan duty-free shops showed a trend of crowding, and there was not even a place to go to the toilet. I even went with a friend to bring me a bottle of perfume from there.
People just don't buy your Estée Lauder, that's all.
In fact, there are many foreign brands with the same fate as Estée Lauder, they may not have how advanced technical content, but the positioning is often relatively high-end - belonging to the poor can not afford it, the rich can't look at it, but the middle class flock to it.
But now the situation has changed, everyone is not spending as lavishly as before, and the publicity and image of domestic brands have also come up ... The good days for foreign brands are also over.
At the end of the day, it's a "disenchantment" process.
A female friend of mine put it bluntly: the quality of domestic brands is now keeping up, and they are also willing to spend money on marketing, plus many KOLs have been found to be "just bad money" - in the end, everyone thinks that your foreign brand is not enough.
The reason for this "disenchantment" is because of the progress of China's manufacturing industry.
Another friend of mine now buys a car and recognizes BYD Han, and other brands say nothing is good. Why, because BYD launched the "Lookup" series, a product that everyone looks up to, because BYD's cars are indeed getting more and more beautiful. In fact, not only Dizi, the computer he recently bought is also domestic Shenzhou - in his words, the cost performance hangs "aliens".
When technology, workmanship and everything are getting better and better, the brand will naturally become high-end, because consumers will make choices.
The changes behind the three data
The change in brand selection is the most superficial, because this has reached the end consumer. The changes at the front end are actually more profound.
The last three data are more frightening to read.
The first data is the change in China's export data to different countries from January to April this year.
For the first time this year, China's share of exports to the Belt and Road countries exceeded that of exports to the United States, Europe and Japan.
The second data is the cross-border settlement data of RMB.
In March, the renminbi's share of cross-border settlements in China surpassed the dollar for the first time.
The third data is China's surplus and deficit data.
From January to April this year, exports increased by 10.6% year-on-year, and imports increased by only 0.02%.
Another data: according to Xinhua News Agency, from the perspective of export products, in the first four months (2023), the mainland exported 4.44 trillion yuan of mechanical and electrical products, a year-on-year increase of 10.5%, accounting for 57.9% of the total export value. Among them, driven by the export of new energy vehicles, automobile exports increased by 120.3% year-on-year.
When the four data are taken together, there is a picture:
My biggest guests are those Belt and Road countries.
The currency I use the most is the Chinese yuan.
The category I sold the most was mechanical and electrical products,
And I'm selling high-end stuff.
Mainly new energy vehicles and lithium batteries.
Overall, I buy less but sell more now.
To sum up: a cross-country economic system that does not include the United States, does not use the dollar, has taken shape, this system is based on the "Belt and Road" and China as the core, the RMB is the main currency of this system, China in this system mainly exports industrial products represented by mechanical and electrical products, and imports various resources represented by minerals and oil.
Feel the shock of the new system, right? Without relying on Europe, America and Japan, we can still live well.
And it's better not to rely on Europe, the United States and Japan - now the situation in Europe and the United States is not very good, if Europe and the United States are still our big customers, then they are soft, and we can't get hard. Fortunately, we have switched, we have turned the "Belt and Road" countries into big customers, it does not matter if Europe and the United States are soft, I will still do business with another customer.
Most importantly, although the nature of customers has changed, the total volume has increased. In the first quarter of 2023 (January-March), 5.65 trillion was exported, an increase of 8.4% over the same period in 2022, while in 2019 the figure was 3.77 trillion.
Anyway, whose money is not earned?
China is filling the vacuum
Since China's new system has risen, in theory, there must be a vacuum that has been filled.
And about the matter of "filling the vacuum", the most typical is Russia.
Since February last year, when Russia's "special military operation" shocked the world, European and American companies began to withdraw from Russia en masse.
The sudden departure of European and American companies has left a huge vacuum in the Russian market, so who will fill this vacuum in this case is a very simple question.
There are so many economic highlands in the world, Europe and the United States have been withdrawn, is it possible that you are counting on Africa and South America to fill the pits?
So what we see is: according to data from China's Ministry of Commerce, in 2022, the bilateral trade volume between China and Russia reached a record $190.271 billion, a year-on-year increase of 29.3%, and China has been Russia's largest trading partner for 13 consecutive years. In 2022, China's exports of mechanical and electrical products to Russia increased by 9% year-on-year, high-tech products increased by 51%, and automobiles and parts increased by 45%. After-sales service of related products has become an important part of Sino-Russian service trade cooperation. At the end of 2022, the share of the renminbi in Russian import settlements jumped to 23% from 4% at the beginning of the year, and its share in export settlements soared from 0.5% to 16%.
Before the "special military operation", the largest mobile phone brand in Russia was Samsung, the second largest was Xiaomi, the third largest was Apple, and the fourth was Realme (owned by Oppo). But now, Samsung and Apple have largely disappeared from the Russian market, and Xiaomi and Realme have directly swallowed nearly 80% of the share.
The situation in the car market is similar, Russia's local Lada is of course the coolest, the share has increased directly from 22% to 28%, Chery and Great Wall from China have both benefited, from 3% market share to 6%, Geely has also changed from 1% to 3%.
The withdrawal of foreign car companies has directly made the market share of Chinese car brands in the Russian market jump from 8% to 17%.
In this link, the most tragic is the Koreans.
Samsung's original share of more than 40% in the Russian market was directly cleared to zero, and the original 23% share of the two brands of Hyundai and Kia in the Russian market was dried up to 19%.
After the collapse of the USSR. The territory that the Korean predecessors spent decades to build, and the younger generations abandoned it, saying that if you don't want it, don't ... It's really "the cub sells Ye Tian and his heart is not painful".
Moreover, South Koreans have also been "unfavorable" recently, and the export value of almost all categories except auto parts has fallen sharply by double digits. Exports of LCD products fell 62.3%, exports of home appliances fell 44.7%, wireless communication equipment fell 40.3%, semiconductors fell 33.8%... Auto parts were good, also down 5.3%.
After all, what does the dispute between Russia and Ukraine that is constantly unreasonable concern you Koreans? Well, now, the Russian market, which Xiaomi and Chery would have taken several years to gnaw, can now lie down and win. You Korea itself is an extremely dependent country on exports, and now you have given up your position for many years, I really don't know what the decision-making mechanism is behind this.
After decades of development, the relationship has not even opened up wisdom, so go back and read more "On the Six Kingdoms".
The "New Three" of the New System
Supporting China's new system is, of course, China's strong industrial prowess, because we are the largest industrial country and package the production of almost the vast majority of the world's products.
In the vast sea of Chinese manufacturing, the brightest thing now is the "new three" - new energy vehicles, lithium batteries, and solar cells.
Why are these three the brightest? Because I stepped on the pulse of the times.
In fact, now all countries are transitioning to new energy, after all, oil prices are here, and the streets of the United States are full of Japanese cars known for their fuel efficiency. Sooner or later, everyone will have to change to new energy - this is the basic condition for the rise of China's "new three things" in the global market.
Among them, the most ruthless is the automotive industry, China's new energy vehicles have become the "emperor superstar" to drive exports, and BYD is a well-deserved king of it.
In the first quarter of 2023, China exported 248,000 new energy vehicles, a year-on-year increase of 1.1 times. Among them, BYD exported 43,000 vehicles, a year-on-year increase of 12.8 times, and it was a critical hit that hurt.
In fact, it is not only BYD, Geely's exports also increased by 53% in the first quarter, and the growth rate of new energy exports reached more than 75%.
It can be said that the entire Chinese new energy automobile industry is making efforts.
And don't think that this is just a "flash in the pan", the problem that BYD is more worried about now is "capacity" - building a car is not a problem, the problem is whether it can transport the car to a foreign country.
So BYD has rarely built its own "fleet": Guangzhou Shipbuilding International, a subsidiary of China Shipbuilding Group, said that it will start well in 2023 and successfully take effect the construction order of two BYD Group 7,000-vehicle dual-fuel PCTC (car carriers).
According to online news, BYD eventually plans to spend 5 billion to build 8 car carriers, 6 are basically confirmed to be built, and the remaining 2 will depend on the situation.
I really want to give Wang Chuanfu the title of "Chuanfu New Energy Electromagnetic Manifestation Saint True Monarch".
Benefiting from the big victory in the automotive industry, other industries quickly followed, such as lithium batteries and solar cells.
In the first quarter of 2023, the export value of lithium batteries was 15.969 billion US dollars, and a total of 837 million units were exported. The amount increased by 79.9% year-on-year, while the volume decreased by 7.3%. In other words, in a year, the average lithium battery has risen in price by $10.
Solar cell exports are also very ferocious, although the attention may not be as great as that of lithium batteries. But the number is very large - China's solar cell exports exceeded 90 billion yuan in the first quarter, an increase of 23.6%.
New energy trams, lithium batteries, solar cells... These are all products that were born and developed in Europe and the United States, but in the end, they were all carried forward in China.
No way, who let us Chinese what we are best at is mass production to reduce costs.
The international responsibility of a manufacturing power
After not relying on Europe, the United States and Japan, the main engine of China's exports is to include several groups along the "Belt and Road" countries - ASEAN, Africa, Russia, Latin America.
Of course, there is still a peculiarity to market changes in Russia, after all, this is an event dominated by political factors. However, changes in markets such as ASEAN are a reflection of pure Chinese manufacturing influence.
Before discussing the influence of China's manufacturing industry, we must first clarify the fact: China's reform and opening up for so many years, indeed its strength has grown rapidly. After rapid development, we can no longer do those labor-intensive low-end manufacturing industries, so we will definitely move some low-end industries to places where labor is cheaper.
Low-end industries will definitely shift from better developed areas to less developed areas - this is the basic law of economic development.
It is precisely because of this law that China's export patterns to ASEAN, Russia, Latin America and Africa are different.
Among the four regions, ASEAN is the best place for economic development, and several countries together rank fifth in the world, second only to the United States, China, Japan and Germany.
But the situation in ASEAN is also clear to everyone, although the scale of the economy is large, the level of development is not high and uneven - Singapore's per capita GDP can be compared with Western European countries, but countries such as Myanmar and Cambodia can basically only share a room with the players in the African region.
In short, ASEAN as a whole is in a state of political stability, far from war, but too backward to make money.
In fact, Africa and South America are similar, but they don't have the money of the ASEAN bloc.
So many countries in Africa, many of which are still in a state of warlordism, have no way to develop their economies. African countries that trade more with China are basically several relatively stable countries in contemporary Africa - South Africa, Angola, Nigeria and so on.
In this case, it is a joke to expect that there is any good industry in these regions, in fact, for the vast majority of developing countries in Asia, Africa and Latin America, it is already a "great blessing" to be able to make money by selling resources.
It is precisely because of this pattern that China's new system has revealed its greater significance.
In this new system, China plays the role of an integrator — it imports raw materials from these countries and then exports manufactured goods to these countries.
It may seem similar to what the West has done before, but if you look closely, you will find that China is doing completely different things - in short, China's new system can be called "immeasurable merit".
Let's start with Vietnam.
Of course, China has exported a large number of manufactured goods to Vietnam, and Vietnam's mobile phone ranking has basically been "slaughtered" by Chinese brands, but China has also exported "raw materials" to Vietnam - Vietnam has undertaken many labor-intensive industries in China, and is now also a major garment producer, but Vietnam's industrial base is weak, so it is still necessary to import fabrics from China.
China does not simply earn "scissor difference" through manufactured goods, which is too low-level. We don't just sell you manufactured goods, I also sell you raw materials for production. You buy my equipment and raw materials to make money, and after you make money, you buy my finished products to enjoy.
I made money, you made money, and everyone has a bright future.
Then there's Africa.
What we see in the news every day is that China has given loans to XX African countries again, and has built railways and reservoirs for others... Many netizens always like to put on a high posture at this time, and then say bitterly, "It's big money outside again."
This is the cognitive problem of "summer worms are difficult to speak ice".
In fact, what is the essential difference between Africa and Vietnam? It's just that the Vietnamese infrastructure is okay, so we don't need to repair the airport.
Our routine is always to rely on my industrial strength to provide you with the necessary modern foundation, and then wait for you to develop and grow, and then I will sell you more advanced things.
Why is China so keen to help third world countries?
A: Because we are the world's largest industrial country, because we have the largest and most complete industrial system - we help them build infrastructure, and when their economy develops and the people have money, they can buy mobile phones, cars, toys, and home appliances that we produce.
How much money does it cost to help them build railways and airports? When these infrastructures are repaired, when they have money, in the future they will wear Li Ning Anta, drive Chery BYD, use Xiaomi Oppo, put Gree Haier at home, and play Tencent NetEase in their hands... And how much is this?
So looking at Chinese companies going to different countries, we can see our layout:
To go to these underdeveloped areas in Africa and Latin America, it has always been "infrastructure madness" such as China Railway, China Construction and Power Construction, followed by CRRC, XCMG, Sany and other equipment enterprises. When your domestic infrastructure is finally complete, when you start selling ores and agricultural products to make some money, we will start selling you various production lines, so that you can make more money by upgrading your industry, and at the same time sell mobile phones, home appliances, and cars, so that the people who get rich first in your country can buy them...
China has never been afraid of your wealth, but that you are too poor to afford my things.
Previously, we said in the article "Made in China": instant noodles are a high-end food in Afghanistan, and they are a good thing that will only be taken out when visiting relatives and friends and gatherings; The houses of Afghan tycoons, from tiles to windows, are imported from original China; Chinese battery cars caused a sensation on the streets of Afghanistan; Even second-hand solar panels can be in short supply in Afghanistan, supporting the electricity market in rural Afghanistan.
Being able to meet the needs of almost all products from primitive to modern products in these third world countries is our ability as the number one manufacturing country.
It can help them develop the economy, let them evolve from primitive to industrial, and generate demand for more advanced goods, which is our responsibility as the number one manufacturing country.
Xinghai Intelligence Bureau