Cao Dewang: The global industrial chain will not and will not be able to decouple from China in the short term

Cao Dewang: The global industrial chain will not and will not be able to decouple from China in the short term
Core views: 1.The global industrial chain will not be restored in the short term, and it may take several years or even longer.After the outbreak, to prevent the possibility of the global economy entering the Great Depression, the demand may also be greatly reduced.The decrease in export orders has led to increased business pressure on enterprises. The key to solving the problems of enterprises lies in the orders, perhaps not in the flow of funds.2.After the epidemic, countries will start to build a more independent, complete and safe industrial chain will be a trend, and there will be a shadow of adversity.However, in the short term, it is difficult for each country to construct an independent industrial chain and industrial system. It is also difficult for the global industrial chain to undergo reversible changes in the short term. The global industrial chain will not be in the short term, and it cannot be decoupled from China.3.If there is no traditional manufacturing industry such as epidemic prevention materials, we must also rely heavily on imports.China must have a traditional industry that has been prosperous for a long time, otherwise the Chinese economy cannot achieve independence.4.This crisis is unprecedented. We must first be able to survive and then seek further development.Don’t care about how much GDP is growing now. National security and social stability should be the first goals.The global epidemic situation has not yet reached the moment of meeting the inflection point. Facing the severe and complex international epidemic situation and the world economic situation, high-level national officials have recently stated that we must adhere to the bottom line thinking and make time for the ideological and work preparations to respond to changes in the external environment.The epidemic is spreading all over the world, and China’s exports are under pressure. From the perspective of entrepreneurs, do you want to save enterprises, especially those exporting foreign trade?Sauna, Yewang interviewed Cao Dewang, chairman of Fuyao Group, on these issues. Cao Dewang believes that the crisis encountered by Chinese companies this time is completely different from the previous crisis. It is the reduction of foreign orders affected by the epidemic that has led to increased business pressureWhat method of saving the enterprise will test the wisdom of the government.”The government must be targeted when it comes to bailing out enterprises. At the same time, it can also consider inclusive policies, some of which cancel the replacement of enterprises during the epidemic and allow large enterprises to avoid depreciation charges.The epidemic not only changed the fate of micro-enterprises, but also reorganized the global economic and political landscape.In Cao Dewang’s view, after the epidemic, countries began to integrate more independent and complete, safe industrial chain will be a trend, perhaps the trend of adversity gradually, and will eventually become a foregone conclusion.”However, in the short term, it is difficult for each country to construct an independent industrial chain and industrial system. It is also difficult for the global industrial chain to undergo reversible changes in the short term. The global industrial chain will not and will not be able to decouple from China in the short term.”Yes, the manufacturing cost has gradually changed, and some industrial chains have shifted to Southeast Asia.In Cao Dewang’s view, China must have a long-term and prosperous traditional industry, and these enterprises must be retained, otherwise the Chinese economy cannot achieve independence.The current global economy is still in great uncertainty. Cao Dewang believes that the crisis brought by the epidemic to the world economy is very special. I believe there is no precedent.”The Chinese economy is greatly affected by imports and exports, so we must plan ahead.Survival is the last word. We must first be able to survive and improve the food problem.”” Corporate leaders should take the lead in reducing wages “. Sauna Night Net: Recently Fuyao raised 4 billion yuan through ultra-short financing bonds to maintain normal operation and development.After the double impact of the epidemic at home and abroad, can Fuyao survive it?Cao Dewang: The impact of the epidemic, the company will certainly suffer a lot of losses.But Fuyao ‘s debt ratio has been very low, and there is no messy investment. I believe that this time we can stick to the past.Looking at it now, despite the impact of the epidemic, our first quarter results are still barely.Sauna Night Net: How much impact do domestic and foreign epidemics have on China’s manufacturing industry?Cao Dewang: In the spread of the national epidemic, China has suspended production for two months.Now that the overseas epidemic is spreading, we must accompany the whole world to continue to stop production and shutdown.Most manufacturing enterprises, especially those manufacturing enterprises that export to foreign trade, will have a hard time, and it will be difficult for some enterprises. Some companies may even have a hard time.Now many companies are faced with a dilemma-if you keep the workers, the workers’ wages are a big expense if there are no orders.If you lay off workers, it has been difficult to recruit workers for years. After the epidemic recovers, you may not be able to return.Sauna Night Net: Do you have any suggestions for entrepreneurs?Cao Dewang: Entrepreneurs must first have their own ideas and find ways to save themselves and protect themselves.For the survival of the fittest, entrepreneurs must review the situation and adjust their business ideas in a timely manner.According to the needs of the market, if you want to reduce your salary, you must take the lead in reducing it. If you want to lay off employees properly, you must strictly follow the national compensation standard and compensate the demobilized employees.In addition, companies must protect their cash flow, and only the excess cash flow can ensure that the company will function normally again in the future.The more difficult times, the more we have to reflect and sum up, why our companies can not withstand the toss of the epidemic?Because many companies have made diversified investments in these years, cash flow is already very tight, and many companies can’t withstand the impact of the epidemic, and they suddenly fell.We must remember that entrepreneurs must establish a high degree of responsibility for the money they handle. Whether the money is borrowed from a bank or invested by investors, it is called money and must be guarded unconditionally.”The recovery of the global industrial chain may take several years.” Sauna Yewang: Export is one of the troikas driving the Chinese economy. Now many people are discussing how to rescue enterprises, especially foreign trade export enterprises.So, what do you think?Cao Dewang: Once an enterprise closes, it will be difficult to recover.China’s export enterprises are mainly small and medium-sized enterprises, and these huge small and medium-sized enterprises have created most of China’s foreign exchange.If possible, enterprises should be given some assistance.But this time the crisis encountered by Chinese companies is completely different from the previous crisis, which makes it more difficult to rescue companies: First, the global supply chain is now broken, which is very terrible.The epidemic is spreading all over the world, and the demand in overseas markets has shrunk. To whom do we produce?In the long run, there will be many unremarkable small factories falling through the epidemic, but these small factories are an important part of the global industrial chain. Once they close down and rebuild, it will take a process.Therefore, I believe that the global industrial chain will not be restored in the short term, and it may take several years or even longer.Second, the epidemic has hit the global economy hard, and governments of various countries have spent less money to save the market.Just like a serious illness in human life, while physical fitness is damaged, it also increases the burden of spending money on medical treatment.After the outbreak, to prevent the possibility of the global economy entering the Great Depression, the demand may also be greatly reduced.And now that the aircraft is grounded, and many unloaded dock workers go home, there are certain difficulties in transporting the things we produce to the outside.The decrease in export orders has led to increased business pressure on enterprises. The key to solving the problems of enterprises lies in the orders, perhaps not in the flow of funds.Simply by giving money, we cannot solve the problem of the decline in the current order demand of enterprises. The government must be targeted when it comes to bailing out enterprises. This requires our government to conduct in-depth research and thinking.There are also some inclusive policies that may be considered.On the budget, we are implementing a substitution system. If enterprises lose money inevitably, they will also have to pay taxes. Many companies hope that the government will cancel the substitution of enterprises during the epidemic and reduce the pressure of substitution.In addition, the United States revised its accounting law when it rescued companies in the 2008 financial crisis. I think it can be embedded in a similar way.Sauna Night Network: China also has a consumer market of 1.4 billion people. Can domestic sales become the outlet for export-oriented enterprises?Cao Dewang: This estimate is also difficult.We have a huge consumer market, but most of us may spend the most money to buy a house.Except for houses, most people may not have much real consumption needs and expenditures.And the epidemic has not really passed, and consumption will be affected to a certain extent.”We must be alert to the de-sinization of the global industrial chain after the epidemic.” Sauna Yewang: This epidemic exposed the risk of the global industrial chain being too long. Will the global industrial chain change after the epidemic?Cao Dewang: In the past few decades, countries around the world have been based on restructuring and conversion from it. Each country ‘s industrial chain cannot be independent, and must be embedded in the global industrial chain.However, after this epidemic, the degree of mistrust in various countries will increase.I believe that the economic industrial chain policies of various countries have made certain adjustments, and countries will start to build a more independent, complete and safe industrial chain will be a trend.Under the trend of simplified global industrial chain, the shadow of adversity will appear.It may be that the trend of adversity is intensifying and will eventually become a foregone conclusion, but adversity will cause great harm to countries, and it is also a huge disaster for the global economy.Sauna Night: Many people are discussing whether the global industrial chain will accelerate its decoupling with ChinaCao Dewang: After the epidemic, all countries want to establish an independent and complete industrial chain, and the global industrial chain will be simplified.After the epidemic, the global industrial chain will reduce its dependence on China. We must be alert to the de-sinization of the global industrial chain.However, in the short term, it is difficult for each country to construct an independent industrial chain and industrial system, and it is difficult for the global industrial chain to undergo reverse changes in the short term.Some countries have the ability to construct independent industrial chains, but some countries do not.Even in the US and Europe, it is not easy to form an independent and complete industrial chain after the epidemic.In the past few decades, many of the United States and Europe have always implemented de-industrial policies and vigorously developed virtual economies. Now, the industrialization of these countries has been almost gone, and many industries have been outdated.If you want to resume manufacturing, and form an independent industrial chain system, there are great shortcomings-first, there is a lack of people who make industrial investments, and there is a lack of bosses.Without Japan, South Korea, or Europe and the United States, the second generation of many manufacturing companies are reluctant to take over the work of factories, manufacturing, and are more willing to do virtual economies such as the Internet and finance; the second lack of labor, deindustrialization causes young people to arm finance, Real estate and other industries, the manufacturing industry lacks young workers.In the United States and Europe, the cheapest are energy resources such as electricity and natural gas, and the most expensive is the labor cost, so the labor cost is higher than China.The third lacks management personnel; the fourth lacks funds.In addition, the existence of the trade union system, the tension between the employers and employees against the United States, the development of European manufacturing, this problem is difficult to deal with.This is because the two-party congressional mechanism and the competition program are the main sources of tension in labor relations, and this issue cannot be resolved in the short term.Now some industrial chains are shifting to Southeast Asia, but now Southeast Asia is like China at the beginning of the reform and opening up. The infrastructure is very poor-poor roads lead to poor transportation and logistics, and the supply of water and electricity often changes, and it has to go to another region.It will take at least two or three years to rebuild a factory. These are the costs that companies need to consider.From the perspective of China’s social and economic environment, after more than 40 years of reform and opening-up, China’s economy and the world economy have intersected each other. If you are me, you are me. If the global supply chain and industrial chain are decoupled from China, it will bring both sidesHuge damage.Moreover, now looking at the world, from Russia, Japan, South Korea, to Europe, the United States, only our hardworking Chinese workers are still doing things seriously.Therefore, in the short term, it is difficult for the global industrial chain to find an economy or solution that replaces China. The global industrial chain cannot and will not be decoupled from China.At the same time, we must also reflect on the shift to rising fuel costs, trade frictions and other factors. The cost of China’s manufacturing industry is rising. China’s manufacturing is losing its competitiveness in the international arena, and there is a phenomenon of industrial chain shifting to Southeast Asia.The decline in manufacturing competition will cause a decline in national competition, which must arouse introspection among all of us Chinese.”China’s economy cannot achieve independence without traditional manufacturing.” Sauna Yewang: There are also many people who believe that the industries moved to Southeast Asia are low-end manufacturing, and there is no need to retain these low-end enterprises and low-end industries.Cao Dewang: The foundation of China’s industrialization is already very poor. These enterprises have moved away. What are we left?I believe that these enterprises must be retained, otherwise we will regret it in the future.We Chinese, Chinese companies are too quick to get quick results, and often divide the industry into high-end and low-end.In the eyes of many people, the Internet, big data and informatization are high-end industries, and manufacturing means cheap labor and low-end industries.But after the outbreak, an N95 mask sold for up to US $ 175 in the United States and became a high-end product.From this we can conclude that there are only low-end people in the world and no low-end industries.Through this epidemic, we must also reflect on that if there is no traditional manufacturing industry such as epidemic prevention materials, we must also rely heavily on imports.China must have a traditional industry that has been prosperous for a long time, otherwise the Chinese economy cannot achieve independence.Of course, after the epidemic, China has to establish an independently completed industrial system. In addition to rebuilding traditional manufacturing, it must also master core technology. Without core technology, it has to be constrained by foreign industrial chains.At the same time, manufacturing is the foundation of the national economy. If there is no basic traditional manufacturing industry, many so-called high-end industries will not develop at all.In my opinion, the Internet or chip technology, or big data, these technologies or tools can improve the efficiency of economic operation and development.But if there is no manufacturing industry, the development of high-end industries is impossible to talk about.It is as if the table is filled with beautiful and delicate knives and forks. If there is no food, what do these knives and forks do?It can only be furnishings.In the national economy, no one can be separated from anyone in each industry, there is no high-end, low-end, each industry must coordinate development, so as to form a complete industrial system.Sauna Night Net: How to retain these enterprises?Cao Dewang: Excessive real estate investment leads to bank funds, labor and other resources will flow to real estate, pushing up the cost of manufacturing.No longer blindly engage in real estate, a large number of manpower, funds are left.”It is still impossible to predict the final impact of this crisis, and our ability to survive is the key.” Sauna Yewang: Under the current complicated domestic and foreign economic conditions, what are you most worried about?Cao Dewang: Under the epidemic, the flights were grounded, the country was closed, and the world became chaotic. The epidemic completely disrupted the global ranks.The destructive power of the epidemic is so huge because the global supply chain is already messy.The crisis brought to the world economy by this epidemic is far from being comparable to the 2008 financial crisis. Although the final impact of this crisis cannot be predicted, a crisis should be unprecedented.China’s economy is greatly affected by imports and exports. We must take into account the serious internal and external issues facing us, and we must plan ahead.Survival is the last word. We must first be able to survive. After solving the problem of food and clothing, we must seek the next step of development, and then seek better and better.We should not care about the rate of GDP growth now, we should make national security and social stability the first goals.I am most concerned about food issues now.I am a person who has experienced food difficulties and knows the taste of hunger.Although our staple food supply is superfluous, relevant departments must attach great importance to food issues.Many countries are now prohibiting the export of grain, and we should also cherish every grain of grain. At the same time, we should invest funds in agriculture, rural areas and farmers, just in case.Sauna Night Network: Thank you for accepting the interview of Sauna Night Network.Cao Dewang: These opinions of mine are not necessarily correct, but I am not for my personal benefit, all for the sake of the country, I am anxious for the country.I am 74 years old this year, and I do n’t know if I say these things or do these things by myself.But I have a lot of feelings for this country. I think that China is a Chinese China, and the whole of China should advocate the national interest as the priority.We must tighten our belts and unite our thoughts with the general secretary to overcome this difficulty.Sauna, Ye Wang Hou Runfang Intern Zhao Fangyuan Editor Li Weijia Proofreading Chen Diyan