"There's one thing you have to firmly believe in. In the end, China's manufacturing industry will definitely win. At this stage, we already have a complete education system, a complete industrial system, and abundant labor resources. As long as we stick to the current policies, our industrial products will definitely have a place in the world. You have to clarify your beliefs at the meeting and show your confidence in China's manufacturing industry, "Li He began to teach Yu Dehua.
"Yes." Yu Dehua saw that Li He was speaking with fervor and assurance. He didn't know where Li He got his confidence from, but he could only take notes to deal with the speech tomorrow.
"The Special Economic Zone's economy has only just begun to shift from an inward-oriented economy to an export-oriented one. The Special Economic Zone's policy is to focus on industry and export. If we don't export our products in bulk, how can we become an open base? What kind of industrial products could be exported? It was nothing more than some processed products, and they could only produce these products at the initial stage. We do want to do high-tech manufacturing, precision instruments, precision machinery, and advanced material industries, but do we have the technology? Do you have funds? From the low end to the high end, we need to go through a process. "
Yu Dehua replied, "I understand. It's not just the special economic zone, but the Pearl River Delta and Yangtze River Delta are also full of these garment, textile, and hardware workshops. It's a good place to start, and I've given them some orders as per your request."
"But it's easy to produce these low-end products. How can we make a name for ourselves in the international market?"
Yu Dehua replied, "Our labor is cheap, and so are our prices. Naturally, we're competitive."
"Yes, the price is cheap. But we don't just want the price to be cheap. We want to make it the cheapest price for the same quality. We will make it the price of cabbages, break the international monopoly, and force them into bankruptcy first. It's useless to rely on one or two domestic enterprises to force the opponent into bankruptcy. We have to rely on the chemical fiber, textile, and apparel industries. We also need the cooperation of the upstream and downstream enterprises. This is why I asked you to establish the Apparel and Textile Federation. As long as we work together, we won't be afraid of international price competition. "Li He still followed the old pattern of China's manufacturing industry. Many things were expensive before the Chinese could do it. Once the Chinese mastered the core technology, everything was cheap.
I have a low price, bite me!
Your quality is high, my price is low!
Your craftsmanship is good, my price is low!
You are durable, my price is low!
Your technology content is high, my price is low!
Your style is good, my price is low!
In any case, it was either you die or I live!
You can talk about innovation and development, but you can't do it in a day or two. I can't even fill my stomach, who has the time to talk about the spirit of craftsmanship with you! Don't think about being pretentious. The key is that you can't do something pretentious!
If light industrial products were not sold at the price of cabbages, they would be letting down God!
"Our competitors are mainly Japanese and Korean companies. They are all large textile factories with tens of thousands of employees. Can we squeeze them into bankruptcy?" Yu Dehua really didn't believe this. He had visited the big factories overseas. Not to mention the technical level, just the management level was several times higher than the domestic level.
Even the current apparel industry in Southeast Asia could not compare.
"Yes, definitely. Not only the clothing industry, but also the Qinggong industry. We can push them into bankruptcy. Eyeglasses, arts and crafts, plastic products, hardware products, household appliances, feathers and other products, we can take our time. There will be a day when we can do that." Li He couldn't help but feel a little yearning. He thought that it would be good if he could advance the progress of the domestic light industry by a few years.
"Then the purpose of setting up this Light Industry Union is to fight a price war?"
Li He smiled and said, "What do you think? We want to join forces to fight a price war internationally. There are no more hardworking and hardworking workers than China. If we can't even compete with them in terms of labor, how can China's manufacturing industry have a future? "
It was wrong to simply attribute the development of China's manufacturing industry to the abundance of labor. India and Southeast Asia were all rich in labor. Even Africa had no shortage of people. However, only China's manufacturing industry rose.
It was all due to the hardworking Chinese people.
Although there would be a sense of deja vu of a sweatshop, if one didn't talk about productivity, it would be acting like a hooligan. The division of labor was the embodiment of this world's progress. For the current China people, how to solve the problem of food and clothing, not hard work and tiredness.
Workers worked overtime in exchange for very little pay. The reason for all this was very simple, the country was poor.
Everything depended on productivity.
"Many of our OEM factories follow our requirements and use piecework performance pay. Many workers can't wait to stay on the production line 24 hours. They are really hardworking." Yu Dehua couldn't help but sigh at the hard work the workers put in just to earn a few extra dollars every month. Even he was touched and admired that hard work.
"So a country's manufacturing industry is like this. From nothing to something, from something to excellence, from excellence to strength, from qualitative change to quantitative change, there is a process. Don't ignore this process."
Yu Dehua took a sip of tea and couldn't help but laugh, "From what you said, it sounds like what we're doing is going to be great for generations."
"I don't dare to say that it's going to be great for generations, but at least it's contributing to society. Besides, it's also benefiting the country and yourself. Don't you think about it, if you do this, will you be on the Forbes rich list one day? "
Yu Dehua chuckled, "It's really possible."
As long as he succeeded in setting up the Light Industry Union, how many OEM factories would he have in his hands? How many products would he be able to export? How much money would he be able to earn? He couldn't even imagine it himself!
"Also, continue to upgrade the OEM factories. We'll continue to give them loans." Li He had requested Yu Dehua to give foreign exchange loans to companies with poor technical equipment since last year. The amount wasn't large, only a few hundred thousand USD. It was used to import equipment from abroad, and most of them were old or obsolete equipment. However, it was used to improve the quality of the factory's products by several levels.
"Just this alone, we've lost more than 6 million RMB in foreign exchange," Yu Dehua said with a little heartache. According to his thoughts, the loans were already enough for many factories to support. The key was the fixed exchange rate. In other words, the exchange rate when they borrowed money was the same as when they repaid. It was too generous to these factories. There was a difference of 6 yuan between the official exchange rate and the market exchange rate. Lending 1 million USD a year meant a difference of 6 million RMB. Strictly speaking, Yu Dehua would lose 6 million RMB a year.
"If we let them use the floating exchange rate, not many of these factories would survive." Li He had no other choice. For the long-term development, these were all necessary. Some factories had taken foreign exchange loans to upgrade their equipment in order to upgrade their technology. They had earned back foreign exchange, but the foreign exchange didn't fall into the pockets of the factories. In the end, they had to convert the foreign exchange into RMB according to the official exchange rate. In the end, they had to buy foreign exchange from the market at a high price.
"Then I'll listen to you," Yu Dehua grumbled. He still enjoyed the feeling of being treated well by the factories. He had heard more good things in the past few years than he had heard in his entire life. Now, wherever he went, he was surrounded by people. He even dared to boast that he had a wide network and many friends.
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