A Taiwanese businessman on the mainland predicts that China’s economy will face a major challenge next year as a new wave of epidemics is set off in many countries by a mutation of the New Coronavirus.
With about two million Taiwanese businessmen on the mainland, Radio Free Asia interviewed a number of Taiwanese businessmen to assess the economy of the mainland next year, as the global impact of the new pneumonia epidemic cannot be stopped for a while. The response is polarized between bad and good, depending on the industry they operate.
China’s “National Taiwan Compatriots Investment Association” (referred to as “Taiwan Enterprise Association”) Honorary President Zhang Hanwen said, “We are all very hard, do not know how to do, the two sides of the Taiwan Strait and inconvenient to travel The epidemic is so serious, so we are not optimistic ah!”
Taiwan businessmen: traditional industries fell 60% to 70% layoffs to survive
Zhang Hanwen mentioned that Taiwanese businesses in the mainland are most affected by the epidemic in traditional industries and manufacturing. The epidemic in Europe and the United States are still serious, there are uncertainties in the market variables, restrictions on entry and exit, even customers to and from the problem, especially the U.S. and China tariff issues have not broken through, the United States to Southeast Asia low tariffs, or even tariff-free, the problem is very big.
Reporter: “How many percent of the performance of traditional industries fell?”
Zhang Hanwen: “More than half.”
Zhang Hanwen said, “Now many orders to other countries in Southeast Asia, the U.S. stores are not the whole open, are not a lot of in and out. What about the seriousness of the epidemic in the United States? (Taiwan business) production of daily necessities, like shoes, ready-made clothing this kind of the most serious.”
Zhang Hanwen went to Dongguan, Guangdong Province in the 1990s to set up garment factories, shoe factories. He confessed that he was hit hard by the epidemic: “Now business is very bad, I (orders) dropped sixty, seventy percent.”
Reporter: “Are there layoffs?”
Zhang Hanwen: “Of course there are layoffs, how can we not lay off staff.”
Reporter: “How many people were laid off?”
Zhang Hanwen: “Almost 60% to 70% of the layoffs!”
Reporter: “Have you considered moving to Southeast Asia to set up factories?”
Zhang Hanwen: “Under the epidemic, it’s hard to move anything! Can not move!”
Taiwan businessmen products export-oriented card domestic demand market late?
There are more than 1.3 billion people in mainland China, why can’t Taiwanese businesses in mainland China transform into domestic demand and enjoy the immediate “demographic dividend”?
Zhang Hanwen said, 20 to 30 years ago, Taiwan businessmen who set up factories in mainland China mainly focused on the low cost of labor, when the mainland economy and consumer power were not high, many Taiwanese businessmen did not value the mainland market, and the products produced in mainland China were mainly exported, and the export market was very large at that time.
Zhang Hanwen said: “We Taiwanese businessmen in the mainland are foreign trade more domestic demand less, now to change the domestic market is very difficult, not so easy at once. In the end, the local people than we are more convenient in all aspects of operation, resources, Taiwan businessmen domestic market before would have lacked this piece of resources, you have to catch the customer to time, to have the ability, to contacts, to access, in this above we are at a disadvantage.”
Zhang Hanwen mentioned that some of the electronics industry can still maintain, the restaurant industry is also hard, engaged in take-out, and now to transform to each according to their abilities: “How to do business across the Taiwan Strait? It is not convenient to come and go, we are almost not too moving, almost all are waiting and watching, a move is better than a quiet.”
A tea and a seat the most serious epidemic customer volume fell by 90%
Into mainland China for nearly two decades of Taiwan-funded restaurant chain, the highest frontier had exhibition store to more than 120 “a tea a sit”, the map north to Shenyang, south to Shenzhen, west to Chengdu, several times rumored that may be listed, but recently broke out directly managed stores all closed consumer controversy, only eight franchise stores.
“A tea a sit” former CEO Lin Shengzhi 23 interview with Radio Free Asia, said that a few years ago the business is weak, the most serious epidemic, the average number of customers fell by 90%. “A tea and a seat” is mostly located in metropolitan shopping centers, dense crowds, access controlled, consumers do not want to go out to avoid the risk. “People don’t go out to eat anymore.” This is a global problem!
“As long as the industry encounters people”, during the epidemic are affected. Lin Shengzhi gave an example, directly like the restaurant, retail, tourism, hotel and other service stores of the industry miserable. Many tourist areas were once only one-tenth or one-fifth of the crowd, and restaurants around the tableware industry, food industry, etc. also suffered.
The “contact” industry was hit, “do not go out” industry is hot
The epidemic created new business opportunities, Lin Shengzhi said: “delivery, community-based supermarket performance is particularly good, the medical industry is definitely the future trend, health, community elderly, community delivery meals, are very important future trends, and health-related.”
Lin Shengzhi mentioned that if you want to invest in the mainland, there is no need to do too much labor-intensive industry investment, especially the cost of labor is also high, you can consider investing in technology-intensive industries, similar to technology research and development in the mainland application production. Recently Tongji University professor and Taiwanese businessmen cooperation selenium element food organic, and achieved good development results.
Zhou Baohua, president of Hangzhou Taiwanese businessmen, also told Radio Free Asia that the “heavy equipment” investment of buying land and building plants in the mainland market has lost its advantages, and the “light equipment” investment of operating culture and creativity and art has market potential.
The epidemic economy depends on the domestic market “demographic dividend”
Zhou Baohua, who operates light performing arts and light sculpture industry in mainland China, said that the law of “survival of the fittest” “one down, another up”. The mainland has a domestic market “demographic dividend”, just a city like Hangzhou more than 10 million people, even more than the population of some European countries. The epidemic has created many new industries, young people’s ideas are jumping and colliding, and there are more opportunities for mainlanders.
Zhou Baohua said: “For example, the net red economy products, products with the network in the sale, it is sold very hot. Catering industry e-commerce, takeaway market of the large, including the sale of food, delivery of food, courier, these are red-hot. Electricity around the courier, food, clothing, housing and transport in addition to buying a house can not go to the scene to buy, wear clothes, food can all be used to buy online.”
Zhou Baohua also said that the network TV, television, treadmills, barbells and other indoor fitness equipment performance is also up. As long as the industry related to “people can live without going out”, they can survive and develop. Traditional business models will be eliminated if they are not transformed.
In an interview with Radio Free Asia, Taiwan Enterprise Confederation (TECO) executive director Hsu Cheng-ching mentioned that Taiwan-funded restaurant chains such as “One Tea, One Sit” and “Yiziduo” bread are shrinking. Enterprises suffered losses from the epidemic because they did not make corresponding adjustments.
How to turn the crisis into an opportunity, a major challenge
Xu Zhengwen said: “The delivery system is not doing well, and we need to go online to market the App, so that people can see and place orders. Traditional stores do not do delivery APP, and other cooperation, the price of food and beverage can not fight the food stalls, simple fast food delivery catering in order to respond to the change.”
Xu Zhengwen said, under the epidemic, the domestic market will become a more important part of the world, like in Taiwan dry mix noodles, instant noodles performance growth of 50% to 80%; Taiwan’s imports of cars also reached a peak, the domestic market outside the purchase may be replaced by internal purchases.
Xiamen Taiwan Business Investment Enterprise Association President Wu Jiaying told the station that he was optimistic about the economy of the mainland next year, mainly the mainland, like Taiwan, epidemic prevention is considered to be doing well, and some Taiwanese businesses are involved in the mainland 5G major infrastructure, internal circulation market development. In Xiamen, with semiconductors, electronics industry, sports equipment, daily necessities, edible oil-related, some performance growth to 30%; Europe and the United States epidemic is still severe, many orders to change under the mainland plant, some Taiwan-funded enterprises are not in time to ship before the end of the year, is to increase capital to expand the plant.
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