In April this year, the State Council made it clear that promoting the "going out" of Chinese equipment is an important task for this year's economic restructuring.

The State Council executive meeting held on May 6th also deployed cooperation to promote international production capacity and equipment manufacturing. Equipment "going out" is highly anticipated.

Chinese equipment "going out" has a strong comparative advantage, but it also faces some difficulties and bottlenecks. How can China's equipment manufacturing industry, which accounts for one-third of global production value, play a more active role in the international arena? What reform support measures need to be implemented to create a better market environment for “going global”? How to crack the “going out” financing? Difficulty and financing expensive illness? How to achieve "Made in China" and "China Standard" both "going out"?

In response to these problems, the version of the Sankei Plaza will successively introduce four reports for reference by relevant parties and readers.

President Xi Jinping’s visit has pushed China’s equipment “going out” on many occasions, and he clearly wants to create “flagship projects” in such areas as nuclear power. Premier Li Keqiang even took up the "salesman" of Chinese equipment and said that "to build high-speed railways and nuclear power, under the same quality, using China's equipment may be the fastest construction and lowest cost."

Equipment, economic development necessary; equipment, the country must be strong.

China’s equipment is becoming a shining new national “business card” and sailing into the sea.

"Going out", "good voice" frequently

Last year, the output value of equipment manufacturing industry exceeded 20 trillion yuan, accounting for 1/3 of the world's total

On April 13th, AVIC’s acquisition of U.S. U.S. Alliance will provide global aircraft manufacturers with a package solution from parts procurement to integration services;

On April 15, China South Locomotive acquired the world’s second-largest supplier of deep-sea robots, the British SMD Corporation, and China’s giant orbital equipment sneaked into the ocean from land;

On April 28th, China Railway Construction and the Nigerian government signed the contract for the Ngongong Intercity Rail Project. All projects use Chinese standards...

China's equipment "goes out" and "good voice" is frequently reported.

"The new leap of China's "going out" is exciting." Li Yizhong, president of the China Federation of Industrial Economics, feels deeply touched.

There was a period of time when people raised important equipment and people immediately thought of “stupid black and thick.” From the late 1990s to the beginning of this century, many of China's equipment projects encountered difficulties and could not produce products worthy of pride, let alone international competitiveness. Deepening reforms and striving to innovate, China's equipment companies stick to it and finally usher in the harvest season. In 2014, the output value of equipment manufacturing industry exceeded 20 trillion yuan, accounting for 1/3 of the world's total, ranking first in the world. Millions of kilowatts of nuclear power units, millions of kilowatts of hydropower units and other large-scale research and development of a major technical equipment in the market, high-speed rail, 4G communications, etc. in the world has a very high reputation.

With the increase of competitiveness, the pace of “going out” of Chinese equipment is more robust. In 2014, China's equipment manufacturing industry exported 6.8 trillion yuan, accounting for 56.8% of all industrial products. 110 MW wind power opened the Swedish market, railway equipment entered the U.S. metro market, and shipped 12 aircraft to achieve U.S. exports... A group of high-end equipment successfully opened up markets in Europe and the United States.

Equipment "going out" is no longer simply selling products. With the project general contracting and aid construction projects, the number of projects supporting the “going out” of the upstream and downstream industries will continue to increase. Many construction machinery, power generation equipment, and aerospace manufacturing companies have become leaders in the industry by acquiring well-known foreign companies, establishing overseas industrial parks, and globally.

Today, China’s equipment has accelerated its “going out” and is more confident.

"China's equipment to go out," the advantages are reflected in many aspects." Ministry of Industry and Information Technology, said the person in charge of the responsible person, first, China is the world's largest manufacturing country, after years of accumulated equipment manufacturing industry, has become relatively sound The modern industrial system has a relatively complete system integration capability. Second, China’s equipment has been fully tested by the market in the construction of domestic infrastructure such as bridges and roads, and has strong international competitiveness. Third, China's equipment has obvious advantages in terms of price, quality, total contract duration, and maintenance services, and it is cost-effective. Fourthly, the degree of internationalization of Chinese companies is increasing. A large number of branches and R&D centers have been set up abroad to better grasp opportunities in the international market and adapt to market conditions in different countries. “China is already the third largest foreign investor in the world. With the increase in foreign investment, the 'Belt and Road' strategy will inevitably drive more 'going out' of equipment,” said the official.

“Going out” for mutual benefits

It will not only expand China's development space, but also help countries to accelerate cooperation.

"China's large-scale equipment enterprises 'going out' and participating in international competitions are both the need to effectively enhance China's comparative advantages and increase the level of open economy development, and also the need for enterprises to develop into multinational companies with international competitiveness." Deputy Director of the State-owned Assets Supervision and Administration Commission of the State Council Huang Danhua said.

In the design and layout of some major equipment projects in China, it is not only the domestic market that is focused on, but it hopes to have a place in the world. In particular, equipment-central enterprises, which are carrying out international operations and building first-rate multinational corporations, have always been their development goals. To become an internationally competitive multinational company, enterprises must “go global” to compete for projects, expand markets, and “go global” with services and standards accompanied by equipment.

"China's "going out" will promote the transformation and upgrading of the manufacturing industry, and it will also help create new advantages in exports," said Zuo Shiquan, director of the Research Institute of Equipment and Technology at the Sadie think tank. He said that in the international market, competing with the old equipment companies on the same stage will directly put pressure on Chinese companies to promote the improvement of technology and quality, and then increase the overall competitiveness of the equipment industry. At present, the comparative advantage of China’s exports is changing, labor, financing, and other costs are rising. The advantages of some traditional processing industries are weakening, and the equipment manufacturing industry is expected to become an important growth point for China’s exports.

"Equipping the 'going out' and carrying out international capacity cooperation will not only expand China's development space, but also help countries to accelerate their development," said Lian Weiliang, deputy director of the National Development and Reform Commission.

At present, not only developing countries, including some countries such as Central and Eastern Europe, have great room for improvement in their infrastructure, and even some developed countries are facing aging problems. Chinese enterprises have mature experience and technology in infrastructure construction. Construction machinery and other equipment are of high quality and cost-effective, and have strong scale and technological advantages. They are welcomed in many countries. Going abroad to carry out international cooperation can not only help the economic growth of the host country, but also serve the global economic and trade interconnection. More importantly, Chinese equipment has taken a leading position in some high-end fields. China's high-speed rail, nuclear power and other equipment, advanced technology. Many countries have the need in this area and "going out" can be a win-win situation.

Cooperation has been a win-win situation. The good momentum has already begun to appear. According to data released by the National Development and Reform Commission in late April, since the beginning of last year, China and Kazakhstan have conducted in-depth cooperation in the fields of iron and steel chemicals, machinery, and non-ferrous metals, and 28 projects have been signed. The total investment exceeds 23 billion U.S. dollars, forming a good demonstration effect.

"Going out", but also go well

China's economy is moving toward the mid-to-high end and cannot stop at “800 million shirts for one aircraft”

“To convey a word to Chinese companies: Do you have to do your best!” Premier Li Keqiang, who recommended China’s equipment to the outside world, asked the reporter to bring equipment to companies.

The overall strength of China's equipment does not need to be doubted, but it must be good at the same time as "going out" and it is necessary to strengthen one's strength and improve internal strength.

China's equipment must be "high chorus" at the high end.

What is the major advantage of the major equipment to fight out of the country? The current big advantage is still low price and high cost performance. It is not easy to do this. However, if China’s equipment is to have greater influence in the future, it must enter the high-end market more and show its skill in the high-end sectors of the industry chain. “High-speed rail and high-end equipment such as 4G account for a relatively low proportion of all equipment manufacturing industries in China. There are also some mid- to high-end equipment industries that rely on others in a few key components. Even hydraulic and electronic control in construction machinery Many parts of the transmission need to be imported. Chinese equipment companies still have to work hard to improve the technological content, strengthen technological innovation, and then increase the added value, so as to draw a smile curve.” Zuo Shiquan said.

China's equipment must create more world-class brands.

Today, with the globalization of the economy, the number of internationally-renowned brands is an important indicator of the economic strength of a country. The level of brand awareness and reputation also affects the difficulty of developing new markets. Like the United States GE, Siemens Germany, the world famous equipment industry, China is still relatively small. Enterprises such as Huawei and CSR have only just started in shaping international brands. Relevant experts believe that Chinese equipment enterprises must vigorously promote brand building and improve the gold content of brands while “going out”, and form a batch of international brands with high technological content and good product quality as soon as possible.

China's equipment must improve its international operation level.

More equipment "going out" means that more Chinese companies have grown into multinational companies. “'Going Global' also needs to achieve transformation and upgrading, build an upstream and downstream collaborative industrial chain, and unite 'going out'. Enterprises need to shift from the 'going out' of products to the 'going out' combination of industrial technology, services, and capital. Prices and other comparative advantages will change from a competitive advantage to a comprehensive competitive advantage with core technologies, brands, quality, and services,” said Huang Danhua. In her view, Chinese companies must learn more about their international business philosophy and better master and apply international market rules in cooperation and competition with multinational corporations. Enterprises should also improve their ability to prevent risks in international business operations, fulfill their social responsibilities, increase the localization rate, and establish a responsible international image of Chinese companies.

This year’s “Government Work Report” pointed out that the implementation of the “going out” strategy should be accelerated and Chinese equipment such as railways, electricity, and communications should be promoted to the world. The Chinese economy is moving toward the mid-to-high end and cannot stay in the "800 million shirts for an aircraft." The "going out" of major equipment is an important opportunity to create new pillars and open up new space.

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