China Council for the Promotion of International Trade (ccpit) 2009 Preface

Chapter 1 Overview of the Development of China’s Light Industry

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Chapter 1 Overview of the Development of China’s Light Industry

As a comprehensive industry with a complete industry chain and full range of sectors, light industry is an important industry for China’s national economy. As a consumption industry, light industry covers those industries related to people’s daily life, imposing impacts and restrictions on many other industries. Both light industry and heavy industry are significant and indispensible components of China’s national economy.

According to the current Classification of National Economic Industries (GB/T 4754-2002) issued by the National Bureau of Statistics of China and the management and statistic coverage of the China National Light Industry Council, light industry includes 19 categories, 72 sub-categories and 137 classes, covering salt mining, processing of food from agricultural products, food production, beverage production, production of leather and fur products, furniture manufacturing, paper and paper product making, production of daily chemicals, plastic products, glasss and ceramic products, and metal-made light industry products.

Overview of the Development of China’s Light Industry

China’s light industry saw a gross output of only 6.16 billion yuan in 1949 when the country was just liberated. The figure reached up to 117.788 billion yuan in 1978 as China introduced the reform and opening-up policies. However, its products were of low grade, low quality and limited varieties, failing to satisfy demands of people’s daily life. The majority of daily necessities were supplied with limited amounts and coupons. In 1978, China witnessed a severe shortage of light industry products. Three point three kilograms of sugar were offered to each people, 10.5 pairs of shoes to every 100 people, 85.1 bicycles to every 10,000 people. Meat, edible oil, fabric and some other daily necessities were available to those with coupons. The market was seeing a severe shortage of light industry products then. The gross output of China’s light industry stood at 3,392.9 billion yuan in 2000, a year-on-year increase of 12.80%. The figure rose to 14,323.5 billion yuan in 2008, 4.2 times of the 3,392.9 billion yuan in 2000. From 2000 to 2008, China’s light industry had witnessed rapid growth.

Figure 1 1 The Tendency Chart of the Development of China’s Light Industry from 2000 to 2008

Unit: 10 billion yuan

China’s light industry had gone through rapid development from 2000 to 2008. Its gross output had averagely increased by 19.62% during the ninth 5-year-plan period. The increasing ration had exceeded from 2003 to 2008. After its accession to the World Trade Organization in November, 2001, China began to be engaged in economic globalization in an all-round way. Light industry was among those competitive industries firstly facing international markets since China’s entry into the WTO. It remained a grim challenge whether it could adapt to new situations and smoothly survive the first five year of transition period. The gross output of light industry stood at 4,335.574 billion yuan in 2002, a year-on-year increase of 15.2%. In 2008, the figure reached up to 14,323.459 billion yuan, a year-on-year increase of 10.7%. Its sales value stood at 13,945.046 billion yuan, a year-on-year increase of 9.5%. From 2002 to 2008, the annual growth of the gross output of light industry had exceeded 20%. The year of 2007 saw a year-on-year increase of 25.70%, and the growth rate fell to 21.00% in 2008.

Light industry is the fundamental industry of China’s national economy, including so many sectors and categories as well as covering all corners of the country. The light industries above designated size are intensively distributed in Guangdong, Shandong, Zhejiang and Jiangsu. The gross outputs of the four provinces rank top four in China, accounting for over 50% of the total output of China’s industries above designated size.

China’s light industry includes a large number of sub-industries. In 2008, the enterprises above designated size in the industry of processing of food from agricultural products achieved the largest amount of gross output 233.05 billion yuan, accounting for 24.82% of the total output of light industry. Gross output of the plastic industry stood at 9.684 billion yuan, accounting for 12.52% of the total; food manufacturing industry 77.688 billion yuan, 8.27%. The four sub-industries formed 55.87% of the total output of light industry.

Figure 1 2 Scale Map of Gross Output of China’s Light Industry in 2008

Unit: %

It is proposed in the Development Planning for Light Industry during the 11th Five-Year Period that China aims to gradually become a powerful nation of light industry in about 15 years. During this period, domestic and foreign markets will be further opened. The scale and coverage of utilization of foreign investment will be further enlarged, while more forms will be adopted. Foreign investments have made use of the advantages in capital and technology in some sectors of the light industry to achieve rapid expansion, which has made us think over the security of China’s light industry. Nonpublic economy accounts for a larger and larger proportion in the light industry, and becomes the major component of China’s national economy, surpassing state-owned economy and collective economy. As for foreign trade, the problem in industry structure and unreasonable trade distribution are getting worse, while more trade frictions are emerging. Technical barrier has become the major obstacle. To upgrade the position of China’s light industry in the global industry chain and to adopt international trade rules have become an important task facing the development of the light industry.

Outputs of many products such as air-conditioner, refrigerator, washing machine, microwave oven, clock, bicycle, sewing machine, furniture, plastic processing machinery, ceramics for daily use, lamp, battery, beer, piano, plastic product, mulching film, down product and leather shoes rank first in the world. Their exports are also among world tops. Exports of industrial sewing-machines and bicycles account for 70% of the total trade volume of the world; ceramics for daily use, 65%; refrigerators and washing machines, over 40%; air-conditioners and microwave ovens, 70%; small-sized household electrical appliances, over 90%. These products have been exported to more than 200 countries and regions across the world. China has already become a giant producer and exporter of light industry products, serving as the international manufacturing and procurement center of a large number of light industry products as well as the important distributing center and supplying center for international trade.

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