"Tight Environment" Forces Yangtze River Delta: From "Shop" To "Climb Ladder"

Influenced by a series of factors such as weakening external demand, rising labor and raw material costs, RMB appreciation, lower export tax rebate rate, and tighter monetary policy, the Yangtze River Delta region with a high degree of economic extroversion took the lead in feeling the pain, and its economic growth slowed down significantly, presenting a "tight running" trend. Under the pressure of "tight environment", the Yangtze River Delta "pushes through the old to bring forth the new", accelerating the pace of "climbing the ladder".

"Tight operation" under "tight environment"

The reporter learned from relevant departments that in the first half of the year, Shanghai's economy generally operated smoothly, the added value of industries above designated size increased by more than 12% year on year, the industrial added value, industrial export and consumption growth still showed "three increases", and the regional GDP is expected to maintain double-digit growth. However, the economic growth slowed down. In the first half of the year, the industrial investment dropped 7.8% year on year. In the first five months, the profits of industrial enterprises above designated size only increased by 4% year on year, and the growth rate dropped by about 40 percentage points year on year.

Statistics of Jiangsu Province show that the added value of industries above designated size in the province exceeded 720 billion yuan in the first half of the year, an increase of 16.4%, 3.6 percentage points lower than the same period last year; Manufacturing investment increased by 19.8% year on year, with the growth rate falling by 5.7 percentage points; In the first five months, the profit of enterprises above designated size increased by 17.5% year on year, and the growth rate dropped by 38.5 percentage points.

According to the data of Zhejiang Provincial Economic and Trade Commission, the industrial added value of enterprises above designated size in Zhejiang in the first half of the year was 383.67 billion yuan, up 12.2%, and the growth rate fell 5.5 percentage points year-on-year; From January to May, corporate profits increased by 14.1% year on year, and the growth rate dropped by 17.8 percentage points year on year.

In the Yangtze River Delta region, which has always ranked the top in China in terms of exports, the growth rate from January to May was 2.3 percentage points higher than that of last year except for Shanghai. The growth rate of total foreign trade exports of Jiangsu and Zhejiang fell 7.5 and 5.3 percentage points respectively from the same period last year.

Under the combined force of internal adjustment and external extrusion, the Yangtze River Delta region, where the economic quality has always been excellent, has also seen the expansion of the loss area of enterprises. From January to May, the loss area of enterprises above designated size in Jiangsu Province reached 16%, up 1.3 points year on year, and the loss amount increased 56.5% year on year; There were 10700 enterprises above designated size in Zhejiang that suffered losses, with a loss of 19.6%. At the same time, the number of new enterprises and registered capital declined for the first time in three years, while the number of enterprises that died increased significantly year on year.

Cost, capital and market "three pressures"

The "high cost" pain caused by the soaring price of international crude oil and other bulk commodities, the tight monetary policy and the shrinking export market have caused many enterprises in the Yangtze River Delta to be in trouble.

The Shanghai Municipal Economic Commission said that the international energy and raw material prices rose sharply, greatly reducing the profit space of enterprises. It is estimated that in the first half of the year, due to the rise in the prices of coal and iron ore, the profits of enterprises in the city were 6.4 billion yuan and 1.5 billion yuan respectively, and the price of refined oil was inverted, resulting in a loss of 5.8 billion yuan for refineries.

According to the statistics of Jiangsu Provincial Bureau of Statistics, in the first half of the year, the purchase prices of raw materials, fuels and power in the province increased by 16.1% year on year, and the ex factory prices of industrial products increased by 5.9%. The "scissors difference" reached 10.2 percentage points, one percentage point higher than that in the first quarter.

Tight monetary policy has also tightened the belt of enterprises. A survey in Wuxi City, Jiangsu Province shows that the new loans of major commercial banks in the first half of the year were less than 70% of the same period last year; From January to May, the amount of bank enterprise credit in place accounted for only 39.5% of the total credit, of which the amount of incremental enterprise credit in place was 34%.

Wu Jiaxi, director of Zhejiang Small and Medium Enterprises Bureau, said that financing difficulties have affected the economic benefits of enterprises. From January to April, the financial expenses of small and medium-sized enterprises above designated size in Zhejiang increased by 40.6%, of which the net interest expenses increased by 45.2%, the loss area exceeded 21%, and the loss amount increased by 34.9% over the same period last year.

The weakening of foreign demand, the appreciation of RMB and the reduction of export tax rebate rate have brought down China's export which has been growing at a high speed for many years. A report from the Policy Research Office of Linhai Municipal Government shows that export orders have decreased significantly, and the continuous appreciation of the RMB has made enterprises dare not take orders, disrupting normal production plans; The risk of bad debts in exports has also increased significantly. Yongqiang Group, one of the top 50 foreign trade exporters in Zhejiang Province, was unable to recover more than 300000 dollars of payment for goods due to the bankruptcy of a customer in the United States.

From "Paving a stall" to "Climbing a ladder"

Zhou Minhao, Secretary General of Shanghai Municipal Economic Commission, said that the past "stall" type of growth has been difficult to sustain, and the "tight environment" has just given the eastern developed regions an opportunity for adjustment and transformation. In the second half of the year, we will accelerate the connotative adjustment, accelerate the technological transformation of enterprises, increase soft investment in innovation research and development, staff training, etc., and change the cage for birds to achieve industrial upgrading and transformation.

While advanced manufacturing industries such as electronic information and machinery manufacturing continued to grow rapidly, Shanghai's modern service industry, especially the financial industry, accelerated its development. In the first half of the year, the trading volume of the national interbank lending market, the interbank bond market and the gold exchange doubled; International container throughput and total air cargo transport continued to maintain double-digit growth.

The Zhejiang Provincial Government recently released the Implementation Opinions on the Pilot Work of Small Loan Companies, which specifies that the pilot work of small loan companies will start in July and is expected to start small loan business from September to October. This not only alleviates the "hunger" of private enterprises for financing, but also enables a large number of private capital to find an export and operate under supervision. The unblocked financial channel between private capital and private enterprises is undoubtedly conducive to Zhejiang's economic development.

Despite the difficult times, Wuxi, Jiangsu Province, has not slowed down the pace of "climbing the ladder" at all. Xing Yixin, director of the Economic Comprehensive Department of Jiangsu Development and Reform Commission, said that this year, the city will close more than 540 "five small" and "three high and two low" enterprises, and rectify 211 "three high and two low" enterprises; Accelerate the adjustment of the industrial layout in the urban area, and sign the purchase compensation agreement with more than 100 enterprises "going out of the city and into the park".

At the same time, the city's emerging industries are growing rapidly. From January to May, the output value of LCD industry and biomedicine both increased by more than 50%, and the photovoltaic industry maintained a growth of more than 100%, which is much higher than the average level of the city's industry.