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Original Title: RCEP Officially Signed Overseas Home Appliance Export Outlook
[Home grid HEA.CN original el 18 de noviembre]On November 15, 2020, the “Regional Comprehensive Economic Partnership Agreement” (RCEP), initiated by the ten ASEAN countries in 2012, was officially signed after eight years of negotiations. The RCEP includes ten ASEAN countries and 15 members, including South Korea, Japan, Australia, New Zealand, and China. The content of the agreement covers market access for trade in goods, trade in services and investment, as well as trade facilitation, intellectual property rights, electronic commerce, A large number of regulations such as competition policy and public procurement.
According to Korean media forecasts, after the RCEP takes effect, tariffs on auto parts exported from South Korea to Indonesia are expected to drop from the current 40% to zero. At the same time, with the advantage of China’s home appliance exports this year, the industry expects RCEP to further promote home appliance exports in 2021.
China’s home appliance exports are increasing overseas
Since the epidemic swept across the world, global home appliance production has been affected and the market once was in short supply. As one of the first countries to control the epidemic, Chinese home appliance companies seized export opportunities, continued to innovate technologies and develop new product categories at home and abroad, driving the growth of China’s home appliance exports and consolidating the position of China as the world center of production and commercialization of electromechanics.
It is reported that from the data provided by the China Chamber of Commerce for the Import and Export of Mechanical and Electrical Products, it can be seen that in the first seven months of this year, exports of refrigeration products from China to the United States increased by 83.1% over the same period last year, and exports to Japan increased by 101% over the same period last year. This trend has also appeared in developed markets such as Europe and Oceania. Similarly, exports of microwave ovens and electric ovens from China to the United States have also increased significantly. In the first seven months of this year, exports of microwave ovens and electric ovens increased 17.2% and 16.2% respectively compared to the same period last year. To accommodate the needs of Asian cuisine, the export of induction cooker products to Japan and South Korea increased by 65.7% and 77.5% over the same period last year.
Xinbao Electric, which has been operating the home appliance business abroad for many years, has also seen an upward trend in overseas orders this year. According to Chen Jingshan, Xinbao’s share secretary, its overseas orders in 2020 will drop 8% year-on-year in the first quarter, 25% in the second quarter and more than in the third quarter. 40%, orders remained adequate in the fourth quarter.
In addition to large appliances, small appliances have also become a beautiful “landscape” this year in home appliance exports abroad. Due to the prevention and control of the epidemic, people in Europe, the United States and other countries spend more time at home, and the demand for small appliances such as kitchens and household appliances has also increased. This has fueled the performance growth of Xinbao, a leading Western-style small appliance company. In the first half of 2020, Xinbao Bao Electric achieved operating income of 5.04 billion yuan, an increase of 24.78% over the same period in 2019. In the second quarter of 2020, Xin Bao’s overseas operating income Electric increased by about 25% during the same period in 2019. Xinbao’s export order for small appliances was received once in April 2021.
Some industry analysts believe that with the solid foundation of manufacturing scale, manufacturing capacity and investment in R&D, the comprehensive performance of China’s home appliances has reached the international advanced level and has obvious competitive advantages in terms of at price, quality and design innovation. According to internal calculations by Midea Group, the comprehensive cost of household appliances made in China is 15% lower than the world average. In recent years, China’s home appliance exports accounted for nearly 30% of the world’s total home appliance exports, and they have remained stable. Including the United States, the European Union, Japan and South Korea and other major home appliance markets, the largest source of imports is China. Although the new corona pneumonia epidemic has caused a short-term stagnation or restriction in overseas home appliance production or OEM production, the global market’s dependence on China’s home appliance exports has increased, and the Global market share of China’s home appliance exports has also increased.
RCEP Signs Continuation of China’s Home Appliance Export Advantages
Although China’s home appliance exports hit a new record this year, many home appliance companies are concerned that this is caused by the special situation under the new corona epidemic and may not last long. However, after the signing of the RCEP, the outlook for China’s future home appliance exports has become clearer.
Currently, the 15 RCEP countries represent 30% of the world’s population and almost 30% of GDP, and will become the world’s largest free trade area. Under the RCEP, trade tariffs between China and Japan are expected to be lowered substantially, and China and South Korea will further facilitate trade in key areas. In view of the bipartisan consensus that the United States is trying to cut the supply chain containing Chinese products, especially technological products, the importance of strengthening trade ties and deepening technological cooperation between China and other Asian countries has become increasingly prominent. Experts predict that RCEP will effectively increase trade between member states, improve regional economic vitality and competitiveness, and reduce the region’s dependence on the United States. Analysts noted that the establishment of the RCEP free trade zone will provide a great impetus for China to build a new open economic system in the new era and form a new pattern of development with a domestic cycle as the main body and a national dual cycle e mutually promoting Statistics show that after the signing of the RCEP, China will sign 19 free trade agreements with foreign countries and 26 free trade partners.
Due to the implementation of trade liberalization and preferential tariffs in the field of trade in goods to promote trade facilitation, this will be great news for China’s home appliance exports. After the digital transformation of the entire industrial chain, China’s home appliance industry has become internationally competitive in terms of production, product and channel efficiency. Furthermore, by taking advantage of the tariff advantages of RCEP’s trade liberalization, Chinese home appliance companies will be in a favorable position to take advantage of regional markets in Southeast Asia and even RCEP. .
In addition, the RCEP firm also played an important role in promoting the export of Chinese home appliance brands. In terms of production design, Haier Zhijia completed the acquisition of Fisher & Paykel of New Zealand in 2012; Midea Group also started implementing small appliance production bases in Vietnam in 2006 and integrated Toshiba’s production bases in Thailand; Supor established kitchen appliances in Vietnam in 2008 Kitchenware production base; Lake Electric decided in November 2018 to invest in the construction of an ecologically clean home appliance production line in Vietnam; Holtek invested in building a production base in Vietnam in May 2019. The RCEP signing will further promote the integration of the home appliance industry chain and supply chain in these regions.
It is reported that the member states of the RCEP convention cover the high, medium and low ends of the main industries, and in general have established an economic cycle from financial financing, technological research and development, the supply of raw materials, processing and production to consumption. After the signing of the RCEP, the establishment of a unified Asian market will be further accelerated. The agreement will simplify procedures, remove barriers and adopt unified rules of origin, which will strengthen cooperation and exchanges between members, improve trade facilitation, reduce operating costs of the regional supply chain and promote Optimization of the trading environment. and business in the region. And Chinese home appliance companies will benefit from it too. This is undoubtedly a happy event for home appliance companies suffering from the slow growth of the home appliance market.
(Home Grid® HEA.CN)
