Zhu Ying: Western countries reflect on excessive dependence on Chinese manufacturing

Zhu Ying

The world's factory in China is different from the world factory of the British Empire that year, but it is a fact that China has manufactured the most manufactured products in the world, thereby relying on Made in China.The crown disease epidemic shows the fact that the world is highly dependent on Chinese manufacturing again, but the West has made the sound of not being able to put all eggs in Chinese baskets.

First of all, the world depends on Made in China.According to the calculation of Japan Economic News, every time China's manufacturing production decreases by $ 10 billion, overseas production and sales have been pulled down 6.7 billion US dollars.From the perspective of South Korea, in the case of China's manufacturing production decreased by $ 10 billion, Chinese manufacturers' procurement will reduce nearly $ 300 million from South Korea.Affected by the decrease in supply and component supply from China, the shipping of completion products becomes difficult. Production will decline by about 200 million US dollars, and a total of nearly 500 million US dollars will be produced.

From the perspective of the United States, the supply of parts and products from China has decreased, which has a great impact on the United States.Among the impact of US $ 10 billion, the impact of only $ 400 million from the supply level of China is close to 400 million US dollars.The US Apple receives the supply of mobile phones and other products from China, and the stagnation of Chinese manufacturing will directly lead to the decline in sales.

The crown disease can make the United States feel dependent on Chinese manufacturing.The United States is the largest single market in the world. Acetaminol is the most widely used drug component in the United States. It not only exists in the same name, but also hundreds of colds, influenza, and allergies.Among the global acetamine supply, 84%are from China and India, and China accounts for nearly two -thirds of the total.The US Food and Drug Administration said on February 27 that due to the difficulty of obtaining raw materials from the epidemic area, a certain drug has been short.

For more than 10 years, the United States has moved almost all of the mask factories to China, and 90%of the American masks are supplied by China.The coronary virus invades the United States. The United States cannot find a factory in the United States. The mask crisis occurs.On February 25th, the US Centers for Disease Prevention stated that the transmission of coronary viruses in the United States is probably unavoidable, and American people should be prepared.It is reported that in less than 24 hours, the price of medical masks on Amazon website soared: The unit price of abandoned medical masks was 125 yuan on the 23rd, but the price rose to 220 yuan on the 26th.

Secondly, Western countries reflect on excessive dependence on the vulnerability of Chinese manufacturing.On February 29, economists pointed out that coronal virus is reminding people to rely on the Chinese supply chain to give people a profound lesson, but getting rid of the economic theory that dependence will subvert the Western followers.The New York Times on March 6 pointed out that the most obvious impact of the crown disease epidemic is manifested in trade.This major epidemic has prompted people to re -examine the world's important dependence on the core base of China as the core base of manufacturing. This trend has begun to appear in the Sino -US trade war.

Now everyone understands that the country's economy depends on Chinese manufacturing too much.When Chinese manufacturing is in trouble, it will quickly cause trouble to almost all countries.Everyone generally believes that after the inventory is exhausted in the next few weeks or months, the shortage of parts and components will occur.

Taking automobile production as an example, there are more than 1,000 automotive parts manufacturers in Hubei Province, and about 100,000 automobile parts and related industrial chain companies in China.The slow production of Chinese automotive parts and components will inevitably lead to a suspension of many global auto manufacturers.

Affected by Toyota's management experience, the global vehicle manufacturers are generally adopted by the lean management of Just in Time, which means that the inventory of components is extremely low. For example, Beijing Benz only retains a day of safety inventory.Hyundai, which was cooked by rice, simply stopped working.37%of Japan's imported automobile parts depends on China, and Japanese automobile production is inevitable that it is hit by the Chinese crown disease.In early March, Toyota announced that its Licheng brand reduced production for two weeks.

The President of the EU Chamber of Commerce, Jorge Middot; Wu Ke told the media that the outbreak of the epidemic made many companies realize that it must be diversified to other countries to avoid putting all eggs in a basket.As the only era of stories, China may have passed.Sebastien Breteau, the CEO of Qima headquarters in Hong Kong, said that people have realized from the trade war that they cannot rely too much on China.

With the rise of various types of production factors in China for more than 20 years, the advantages of China's world factories have gradually lost.Prior to the Sino -US trade war, China's foreign -funded enterprises have begun to evacuate. The Sino -US trade war has led to a wave of foreign -funded enterprises evacuated from China. The crown disease epidemic has exacerbated the negative impression of foreign companies in China.They reflected that they could not put eggs in a basket.This is equivalent to thinking about resetting the supply chain.

But this understanding is limited to Europe.Germany's Augsburg reports that the coronary virus will bring risks to the global economy as the title. The journal believes that the global economy is actually very fragile and does not have the ability to respond to such emergencies.On the other hand, the article believes that it must not drive globalization on this pretext.

The United States recognizes that overly relying on Chinese manufacturing to add a layer of security factors, South Korea and Japan must be the same as the United States.Around the 5G network, the United States cuts the 5G supply chain to China.In November 2019, the US Department of Commerce formulated a procedure to protect the US Telecom Network and its supply chain from being threatened by national security.equipment.

After the outbreak of the crown disease, January U.S. Business Minister Wilbur Ross said that this would help to accelerate the pace of returning to North America.In February, Peter Navarro, a White House trading consultant, said that due to the ban on masks from the export of masks, the United States is determined to recall 4 companies specializing in masks from China to return home.In March, the US Senate held a hearing to explore the problem of the US rebuilding 5G supply chain.

The status of the world's world factories will not be lost immediately. On March 9, 2020, the Wall Street Journal published an article stating that the coronary virus exposes a core issue of the global manufacturing industry: China's influence is so great that even those who have transferred production to foreign countries abroadThe industry cannot get rid of the constraints of China's supply network.This is good news for China, but if the problem that plagues foreign companies is not resolved, foreign companies on the supply chain will still leave China.

The author is a professor of economics at Shanghai Normal University Business School

With the rise of various types of production factors in China for more than 20 years, the advantages of China's world factories have gradually lost.Prior to the Sino -US trade war, China's foreign -funded enterprises had begun to withdraw from China. The Sino -US trade war led to a wave of foreign -funded enterprises evacuated from China. The crown disease epidemic exacerbated the negative impression of foreign companies in China.They reflected that they could not put eggs in a basket.This is equivalent to thinking about resetting the supply chain.