Wuhan's economic restart
China News Weekly Reporter / He Bin
Published on 2020.4.20, the 944th issue of China News Weekly
Seventy-six days after the "closure of the city", Wuhan, which was most severely affected by the new coronary pneumonia epidemic, officially "unblocked" on April 8 and pressed the restart button.
The government's investment attraction has also been carried out simultaneously with the "unblocking". On April 8, Wuhan held its first "cloud investment promotion" in 2020. A total of 69 projects were signed that day, involving smart manufacturing, biomedicine, financial insurance, new energy vehicles and other fields, with a total amount of 245.1 billion yuan. Among them, 11 headquarter projects have settled in Wuhan.
As early as a month ago, with the daily decrease of newly diagnosed cases gradually reduced to zero, local policy makers have gradually shifted their focus to economic restart, and the resumption of business and production has become the focus of public opinion.
On March 11, the People ’s Government of Hubei Province issued a notice stating that Wuhan ’s enterprises involved in the protection of epidemic prevention and control, public utilities, people ’s lives, agricultural production, and other enterprises involved in important national economy and people ’s livelihood can resume production. In addition, enterprises that have a significant impact on the national and global industrial chain facilities can resume production after approval in accordance with the procedures on the premise that the prevention and control measures are in place and the prevention and control responsibilities are implemented. Enterprises that have not stopped business since the Spring Festival can continue production.
Delayed recovery
As a first-tier supplier in the supply chain of Dongfeng Motor Co., Ltd., Dongshun Auto Parts Co., Ltd. became the lucky first batch of resumption enterprises.
After getting the permit to resume work, on the early morning of March 12, the company's head He Wei returned to the factory closed for more than a month due to the epidemic and sent a large stock of products that were stocked years ago. "The courier fee was 29,900 yuan, almost five times the usual price."
But He Wei is still glad, "Fortunately, we are the first batch of work to resume on March 11, if it is ten days later, then it will be a big drop (Wuhan, it means" big trouble, greater loss ")."
Compared with the global financial crisis encountered in 2008, He Weicai really felt an unprecedented crisis when the outbreak came.
"I'm not afraid of closing, I'm afraid of the time difference between the unsealing. We and the manufacturers in the same industry are not on the starting line, it will be a fatal blow." He Wei told China News Weekly. He was not unfounded. During the epidemic, a manufacturer in Wenzhou took orders that should have been Dongshun because they could provide products in time.
The epidemic situation was serious. At that time, almost all the forces in Wuhan were fighting against the epidemic. The date of resumption of work was repeatedly delayed, never earlier than 24:00 on February 13th, to 24:00 on February 20th, and then to 24:00 on March 10th. Han Leming (pseudonym) of the Hannan District Political Consultative Conference in Wuhan couldn't sit still. Han Leming, who has been dealing with enterprises in the Wuhan Economic and Technological Development Zone (Hannan District), knows what it means for companies to stop working for so long. "At that time, I heard that 30% ~ 60% of the companies have already failed to get orders and have to close the door."
Han Leming recalled to China News Weekly that at the time, he was sinking in the community to fight against the epidemic, and he had no way to do so. So he built a WeChat group to find several companies in the development zone to understand their needs. Among the problems reflected by everyone, the biggest problem is the loss of orders.
At that time, Luo Zhi, director of the New Private Economic Research Center of Wuhan University, was doing a questionnaire survey on Hubei, especially Wuhan private enterprises. The results analyzed from the 573 questionnaires received were worrying-97.21% during the epidemic Of enterprises completely shut down or partly shut down. Nearly 50% of enterprises are on the verge of bankruptcy. 57.59% of private enterprises persist for up to three months without resumption of work or production capacity is not restored. More than 70% of enterprises have capital shortages and rising operating costs. The plight of more than 50% of the enterprises has the problems of lack of epidemic prevention materials, excessive rent pressure and staff turnover, and 40% of the enterprises report that the market has been seized.
Han Leming fed back his understanding of the situation to several industrial parks in the development zone, but was surprised and asked, "When is the time, but also considering these? Let's talk about the epidemic first." Luo Zhi passed Wuhan. The Federation of Industry and Commerce submitted its research results to the government departments of Hubei Province and Wuhan City. The research report was straightforward. "If the work is not resumed by the end of March, SMEs may die by half."
In the severe epidemic situation, Hubei Province and Wuhan City did not dare to let the enterprises back to work. It was not until March 10 that the General Secretary of the CPC Central Committee Xi Jinping inspected the epidemic prevention and control work in Wuhan and put forward the requirement of “starting the zoning, classification, time-sharing, and conditional resumption of production”, Hubei Province issued a notice the next day, The first batch of four types of enterprises in Wuhan to resume production and production is set at "not earlier than 24 March on March 10."
He Wei finally got the approval for the resumption of production and development in the development zone, as well as the first group of 11 people and the second group of 28 people for the work permit.
On March 11, the leaders of the Auto Parts Industrial Park came to the company to inspect the epidemic prevention facilities, and again emphasized the responsibility to He Wei. Of course, He Wei knows the benefits, but the only way to stop the enterprise is to die. He repeatedly streamlined, in the case of ensuring production capacity, to minimize the number of return workers, cleaning and meals are done by employees themselves, technical staff online. Everything is ready, and the real start of production and resumption of production is already after March 15.
In Dongshun's workshop, half of the lathes were not used in order to ensure the distance between the stations. On the corner of the floor, piles of thick paper shells were piled up. He Wei explained that the nearby hotels do not accept enterprises. The dormitory can't meet the demand of single room, only let the workers lay the floor in the workshop. In Wuhan, which has just entered the spring, the temperature is still very low. For safety reasons, the air conditioner cannot be turned on in the workshop. He Wei ’s greatest concern is that workers have a cold, so that the entire production may have to stop.
According to the original plan, after the Spring Festival holiday, it is normal to go to work. Automobile companies pay attention to the beginning. As an upstream supply chain enterprise, they cannot naturally fall off the chain. Therefore, He Wei hoarded a lot of raw materials as early as years ago. Under normal circumstances, he prepared raw materials at 1.6 times the planned order. He hoarded 2.6 times. It was this decision that allowed him to run for a month after resuming work. Until logistics resume normally.
Compared with the small and medium-sized enterprises' eagerness for resumption of work, some regulated enterprises have not been dared to advance the process of resumption of work despite the early approval for resumption of work.
"Re-work rate does not mean re-production rate. Many re-work enterprises may not produce at full capacity." In Han Leming's view, there are many factors that affect the re-production rate. Low staff arrival rates, reduced orders, and increased logistics costs are all important. the reason.
The Dongfeng Honda, which was approved for resumption of production as early as March 11, did not enter full production until April 6. According to the "Wuhan release" message from the official micro-bureau of the Wuhan Municipal People's Government, on March 23, the three factories of Dongfeng Honda were put into production synchronously, all using the "double shift system", each shift was 9.5 hours, and the daily output reached More than 3000 vehicles.
At this time, the upstream and downstream suppliers and distributors of the industrial chain have truly realized a full recovery. At present, the operating rate of Dongfeng Honda and its more than 500 first-tier suppliers has reached 100%, and more than 550 automobile 4S stores have also been resumed across the board.
In fact, regarding the resumption of work, Qian Deping, executive deputy director of the Construction Management Office of Wuhan National Bio-Industry Base (Optical Valley Bio-City), has also experienced a turbulent journey. He divided the resumption of the bio-city into four stages.
As early as during the Spring Festival, some anti-epidemic material production enterprises and nucleic acid detection production enterprises have returned to work one after another. From February 10th to 15th, under the influence of agricultural time, some agricultural enterprises doing seedlings, fertilizers and additives have resumed work one after another. Subsequently, some scientific and technological breakthroughs and vaccine production enterprises resumed work one after another. Finally, there are some companies that are related to epidemic prevention, but are not particularly close. Some experimental projects are in progress. If the work is not resumed, it is likely that the experimental data will be lost and the previous efforts will be abandoned. Especially for some laboratory animals, the automatic feeding function set during the Spring Festival only meets the needs of a few days. The sudden outbreak disrupted the plan, and the experimental animals were on the verge of starving to death.
"Enterprises are willing to resume work, and there are a lot of applications every day, but it is impossible to approve all of them, and they are most afraid of employee complaints." Qian Deping told China News Weekly, according to the requirements of Hubei Province and Wuhan City Anti-epidemic Command Some enterprises do not resume work earlier than 24:00 on March 10th, and other enterprises do not resume work earlier than 24:00 on March 20th. Before that, some employees resume work. For safety reasons, some employees are not willing to resume work. In this case, he asked the company to negotiate with the employees to solve their worries about accommodation, transportation and transportation.
The traffic problems that troubled employees commuting were gradually solved. On March 25, 117 bus lines resumed operations, on March 28, six subway lines were restored, and on April 8, city traffic, including taxis and ferries, basically returned to normal.
Why Xinghan?
On March 31, Jiangsu Wuzhong Group's "First Industrial Park" won Wuhan Lot 2020 No. 001 with 136.2 million yuan, and plans to develop and construct the "First Industrial Park-Wuhan Zhilian Chuangxing Center Industrial Park" project, It is a theme industrial complex serving intelligent manufacturing, Internet of Things, and big data.
At the same time, in the Qingling Industrial Park, Hongshan District, Wuhan City, the project leader, Wu Jiangzheng, the general manager of the project of Jiangsu Wuzhong Group Wuhan Xinghan Industrial Park Development Co., Ltd., communicated with the prospectors on site. "Our land is very close to the Yangtze River. Drilling and construction are not allowed in the flood season, so we must complete the process of field operations before May." Wu Jiang explained to China News Weekly.
According to Wu Jiang, because of the epidemic, the auction of the plot has been delayed twice. During the delay period, the First Industrial Park, while making some preliminary preparations for recruitment, also put forward the investment promotion work. After winning the bid, the four interested companies will also sign online.
Although the epidemic caused a few investors to wait and see, it did not dispel the investment enthusiasm of enterprises. From Wu Jiang's point of view, Wuhan is a special place. Not only are there more universities, research institutes, and large colleges, but the industry is also very complete. There are traditional steel and chemical industries, but also the automotive industry, communications and optoelectronics industry, and the biomedical industry. . "In terms of industrial development, Wuhan is not partial, and its comprehensive strength is very strong."
"We often say that don't put eggs in the same basket. The diversification of Wuhan's industrial structure makes Wuhan's economy not fully declining in the face of the epidemic." In the view of Wang Tao, deputy secretary general of the Chu Business Association of Hubei Province Although the economic downturn has severely damaged the manufacturing and service industries, the active trade since the opening of the port, the traditional manufacturing industry represented by Wuhan Iron and Steel after the establishment of New China, and the Wuhan Economic and Technological Development Zone (Hannan District) and Wuhan in recent years The new economic industries corresponding to the three national development zones of East Lake High-tech Development Zone and Wuhan Linkong Economic and Technological Development Zone make Wuhan ’s economy more resilient and resilient. Even if one industry is affected more, other industries can Hedging its effects. For example, in this epidemic, many pharmaceutical and biotechnology companies in Optics Valley Bio-City not only did not stop work, but accelerated production and gave birth to new opportunities.
Wang Tao proposed that the research, development and production of the national new coronary pneumonia vaccine be placed in Wuhan. On the one hand, Wuhan is the epidemic center with a large number of cases and samples; on the other hand, Wuhan ’s biomedical industry has developed rapidly and has a good industrial foundation and R & D supporting advantages. , He is ready to submit this proposal to the relevant national departments to provide decision-making reference.
However, during the period of the closure of the city, most of Wuhan's enterprises stopped working and stopped production, which caused a great negative impact on the normal operation of the economy. At present, the official does not have a clear data, but Luo Zhi made a prediction. The loss caused by the shutdown and production is one aspect. Even if the closure of the city is over, it will take a long time from the start of the entire city to the normal operation. During this period As the various components of the city cannot operate at full capacity, the loss of GDP will continue.
Luo Zhi and her research team estimated the GDP of Wuhan from the four aspects of GDP loss during the shutdown period, service loss during the resumption period, manufacturing loss during the resumption period, and manufacturing loss due to contraction in the demand side. The total loss caused.
The composition of GDP is divided into residents' final consumption, government's final consumption, capital formation, and net exports. In Luo Zhi's view, during the shutdown and production suspension, these four parts will inevitably decline to varying degrees. She predicts from optimism, meso and pessimism. After the multiplier correction, the two-month shutdown in Wuhan means that the GDP loss during the shutdown is 241.818 billion yuan in the optimistic case and 308.440 billion yuan in the meso case. In the pessimistic case, it is 341.75 billion yuan.
Even after the unblocking, with the resumption of work, Wuhan's manufacturing industry is unlikely to experience rapid growth. In particular, full resumption of work does not mean a full recovery of manufacturing sales, which is caused by shrinking demand. Luo Zhi analyzed that the current shrinkage of demand faced by Wuhan enterprises comes from three aspects: one is that the market during the shutdown is seized by foreign companies; the second is that the overall demand for the whole country has declined due to production shutdowns; the third is the global spread of the epidemic, which has caused global Demand is shrinking.
"The current shock is actually a supply-side shock plus a demand-side shock. The supply-side shock will actually be more severe in the early stage, because many places are shut down, and the supply chain and industrial chain have not recovered, so most of what we see is supply. Side shock. "Luo Zhi said, but with the full resumption of work, the future supply shock will be less and less, but the demand side shock may be a long-term impact.
In Luo Zhi's view, if Wuhan's economy is to develop, investment pulling is obviously the quickest way to achieve results. Both the Tiegongji and the new infrastructure can quickly drive GDP growth.
On April 10, Wuhan City held a major project construction promotion meeting to start 100 major projects by video connection, involving key industries such as electronic information, automobile manufacturing, and modern service industry, with a total investment of 186.57 billion yuan.
In this round of key project investments around the world, new infrastructure has become a hot topic. This year, Fiberhome also took advantage of the entire industry chain and chips, and gained about 31% in the SPN construction of the world's largest China Mobile 5G bearer network project. The share of the project is over 10 billion yuan.
However, Wuhan City spent a lot of financial resources in the Military Games last year and was hit hard in the epidemic this year. Statistics show that from January to February this year, Wuhan ’s general public budget revenue was 53.855 billion yuan, a decrease of 31.8%. Invest in new infrastructure?
In this regard, "China News Weekly" learned that due to the industrial characteristics of the new infrastructure, most of the central enterprises are currently responsible. For example, the construction of 5G is mainly invested by the three major operators, while the UHV construction is invested by the State Grid, and the construction of the high-speed rail is mainly undertaken by the China Railway Corporation. Therefore, it is generally not affected by the financial status of the local government.
In addition to investment promotion, many experts believe that Wuhan ’s fiscal revenue this year can be reversed either through central transfer payments or by increasing land finance. On the day Jiangsu Wuzhong Group won the Wuhan Lot 001, Wuhan City has sold 10 listed plots with a total area of 120.74 hectares and an amount of 10.853 billion yuan. Among them, 7 land for real estate with an area of 106.74 hectares and an amount of 10.696 billion yuan, and 3 land for industrial use with an area of 14 hectares and an amount of 157 million yuan.
However, to achieve sustainable growth of fiscal revenue, land finance alone is obviously not enough. Taking Qingling Industrial Park as an example, there are currently 1,823 enterprises. Last year, the tax revenue was only more than 300 million yuan, most of which came from real estate project taxation. "Real estate projects are just a one-shot deal. In the long run, it is necessary to develop industry, attract superior enterprises, and create good taxes." Said Jin Qiao, deputy director of the Management Committee of Qingling Industrial Park.
However, due to the constraints of urban construction land indicators and the basic farmland protection system, Wuhan's current three major development zones have become saturated, and many enterprises cannot enter the development zone. On March 12, the State Council issued the "Decision on the Approval Right for Authorized and Entrusted Land Use", announcing the eight pilot areas, and Wuhan was not among them.
"Whether the government can apply to the central government to increase Wuhan as a pilot city, so that the red line of cultivated land can be protected by replacement, and the overall index of construction land in Wuhan can be increased, thereby enhancing the flexibility of the Wuhan city government in land management and improving the utilization of land resources. And allocation efficiency? "Luo Zhi believes that this move will help to improve the tension of industrial and commercial land resources, will also reduce the cost of land for enterprises, and increase the attractiveness of investment in Wuhan.
First aid for people's livelihood
Although proposed as a suggestion, Luo Zhi does not actually promote the short-term policy of stimulating GDP. In her view, even with increased investment and rapid GDP growth, it still cannot improve the "bankruptcy tide" and "due to the outbreak." "Unemployment wave" consequences.
In Wuhan's increasing speed of resumption of production, the resumption of production in the catering service industry is still far away, and only some large chain catering institutions have opened take-out. A catering practitioner in Wuhan told China News Weekly that perhaps the real lifting of the catering industry will take place after mid-May, and it is almost impossible to have retaliatory consumption. Among them, the cost of rent and employee compensation costs are large expenditures of the enterprise. He plans to open the takeaway business in May to ease some of the pressure.
Wang Tao also admits that retaliatory consumption is unlikely to exist: "During the epidemic, the strings in the hearts of Wuhan people have been tight, at least for a considerable period of time, dare not have dinner outside. At the same time, the company suffered heavy losses, debts, and employee wages will be unbearable The most important thing is that public consumption tends to tighten. "
Not long ago, nearly 100 small and medium-sized micro-catering enterprises from Wuhan jointly sent a distress letter to the Wuhan Municipal Party Committee and Municipal Government, saying that 95% of the small and medium-sized micro-catering enterprises in Wuhan were in a critical state of loss or micro-deficiency throughout the year in 2019. Before the outbreak of the new coronary pneumonia, The survival of Wuhan small and medium-sized micro-catering companies has reached the lowest point of the limit. In the distress letter, these catering companies proposed several measures, including rent exemptions, loan guarantee discounts, employee subsidies, and the issuance of consumer coupons.
Not only catering companies, some small and medium-sized enterprises resume work in the long run, and cash flow is unsustainable. Bankruptcy brings unemployment and shrinks consumption. Even if there is no unemployment, some private enterprises have lowered their salaries. And the long-term strict community management also makes it difficult for many marketing department employees who rely on the commission of the business to really resume work. A Wuhan man in charge of market development admitted that he could only get a meagre base salary in the past two months.
"Even if the GDP data looks good, if the people find that people around them have lost their jobs, they will lose confidence in Wuhan's economy." Luo Zhi said that the top priority is that the government should focus on the livelihood of the people. On the one hand, it should protect enterprises and reduce the bankruptcy rate. And the unemployment rate; on the other hand, promotional fees, through stimulus policies to boost consumption, boost confidence.
Earlier, some experts suggested the use of consumer coupons to promote consumption. In this regard, Luo Zhi has calculated an account, based on Wuhan's permanent population of 14 million, if each person issues 1,000 yuan of coupons, that is, 14 billion yuan will be invested, which will boost the city's consumption of 23.9 billion yuan.
In addition to consumer vouchers, Luo Zhi suggested reforming Wuhan ’s provident fund system to allow free withdrawals to increase spending power. According to the current Wuhan provident fund policy, after using a housing loan, it is not allowed to withdraw until retirement. "This is unfair. Why can't I withdraw my own money?" Luo Zhi asked, if he was worried about running, he could stipulate that the provident fund must be kept in a certain proportion in the account.
To truly enable the people to have continuous spending power, they must retain employment and enterprises. In this regard, some private enterprises have proposed to use subsidies to ease the pressure on cash flow, or to make efforts in financial policies, and financing policies are more inclined to SMEs.
Han Leming believes that it is difficult for subsidized companies to achieve fairness, and it is easy to have a Matthew effect. It is better to subsidize the industry and fix the amount of subsidies according to the scale of production.
As of April 10, the Wuhan Municipal Commission of Economy and Information Technology has issued six editions of "Wuhan City's Compilation of Policies for Benefiting Enterprises from Epidemic Situations", which includes 116 policies from the central government to provincial, municipal, and district levels, as well as a total of 116 policy implementation rules. According to China News Weekly, many policies are either temporarily unable to be implemented, or it is difficult to produce actual results, with little effect. And so many policy companies are too late to study one by one.
He Wei has studied some of the corporate benefit policies, and found that many policies are not quantified, and companies are at a loss. For example, the social security relief policy has not been resumed throughout February. Should it be reduced? Half of the time in March did not resume work, how to reduce or exempt? In addition, the new loan preferential interest rate, what conditions do small and medium enterprises need to enjoy?
It is gratifying that as more and more enterprises resume work, some of the problems exposed in the early stage are gradually solved. Three weeks after the interview, when China News Weekly revisited, He Wei happily replied that Dongshun obtained a credit and low-interest loan of 3 million yuan, "the funding problem has been solved."
In addition to the official channels, companies should also help themselves to survive the crisis. In recent years, the “Chu businessmen” resources and alumni resources have played an increasingly important role in Wuhan ’s economic development. In Wang Tao ’s view, as an ancient business gang, the Chu businessmen are wise, hardworking, hardworking, and innovative. Although there have been developments in recent years, there is still a gap compared with merchants such as Zhejiang merchants and Fujian merchants. The biggest problem is that they are not good at holding groups.
"Since the outbreak, Hubei people and enterprises in Hubei have suffered tremendous losses and made huge sacrifices. No matter in Hubei or outside the province, the development of the group can withstand greater impact." Wang Tao said.
China News Weekly No.14, 2020
Statement: The publication of the "China News Weekly" manuscript is subject to written authorization