With the implementation of the current “Belt and Road” initiative, Chinese LED companies have “goed out” to usher in the strategic window period and the golden period of development.
From May 14th to 15th, in the attention of the people around the world, the “One Belt, One Road” International Cooperation Summit was held in the picturesque Yanqi Lake in Huairou, Beijing. The event welcomed 30 heads of state and government, and more than 1,500 political and economic circles from more than 130 countries participated in it, becoming another important international event after Beijing APEC and Hangzhou G20. Chinese President Xi Jinping delivered a keynote speech at the forum, which attracted global attention. Next, how will the Belt and Road process develop and what opportunities will it bring to Chinese LED companies? How do Chinese LED companies seize the opportunity to “go out”?
Work together to promote the construction of the “Belt and Road”. At this summit forum, President Xi Jinping announced the seven measures that China will take to promote the “Belt and Road” construction:
"China will increase its financial support for the construction of the "One Belt, One Road" and increase the capital of the Silk Road Fund by 100 billion yuan."
"China will hold China International Import Expo from 2018."
"We will arrange 2,500 young scientists to come to China for short-term scientific research, train 5,000 scientific and technical personnel and management personnel, and put into operation 50 joint laboratories in the next five years."
“In the countries along the line, we will implement 100 “happy homes”, 100 “loves and helpers”, and 100 “rehabilitation doctors”.
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Facing the future, President Xi Jinping proposed at the summit forum that the “Belt and Road” should be built into a road to peace, a road to prosperity, an open road, a road to innovation, and a road to civilization.
President Xi Jinping clearly stated to the participating parties that he will thoroughly implement the development concept of innovation, coordination, green, openness and sharing, constantly adapt, grasp and lead the new normal of economic development, actively promote structural reforms on the supply side, and achieve sustainable development. “One Belt, One Road” injects powerful momentum and brings new opportunities for world development.
One Belt and One Road Brings New Development Opportunities to LED Enterprises
For LED domestic companies, the opportunity for development lies in the following aspects:
1. “Accessibility Navigation”: including transportation industry, railway construction and related equipment, aviation services, equipment, and complete machine production.
2. “Infrastructure Industry Chain”: including construction industry, equipment manufacturing industry, and infrastructure materials. Under the support of the “One Road, One Belt” strategic policy, the “going out” of foreign engineering contracting construction enterprises can form a large export pull, effectively hedge the decline of domestic demand, and thus drive the entire “infrastructure industry chain”.
3. “Energy Construction”: including pipeline construction related industries for China's oil and gas imports, power station construction, power equipment, etc.
4. Cooperation in the field of science and technology: In addition to international cooperation in the fields of infrastructure and energy, cooperation in the field of technology related to LED-related technologies and the use of technology to provide services to local enterprises have also become issues for LED companies to consider.
From the perspective of the entire demand side, the power consumption level of developing countries along the “Belt and Road” is extremely low, and LED lighting is a highly efficient and energy-saving product with huge development space. In particular, more than 35 of the 65 countries in the “Belt and Road” report a net import of external energy, reflecting the consumption of environmentally-friendly and energy-saving products and the development needs of the corresponding industries. The more likely these countries are to become market demand for LED products.
China's LED products export market has a growth rate of 58%
With the implementation of the National One Belt and One Road strategy, the market growth rate of LED export belts will be higher than the overall level of national LED lighting products exports. The average annual growth rate will be 58% from 2013 to 2020. By 2020, China's LED lighting products will be exported. It is about 53 billion US dollars, accounting for more than 50% of the national total.
"The Belt and Road is mostly emerging economies and developing countries, and is the new blue ocean for China's LED products exports. Among them, South Asia's India, ASEAN, Russia, West Asia and North Africa and other important countries have become China's key export markets for LED, in addition to Germany 50 More than 100% of LED products come from China, and the market demand for LED lamps is even greater after the EU bans.
According to the statistical analysis of the material depth, in the first quarter of 2017, China’s LED lighting products exported 64 “One Belt, One Road” along 64 countries with a total amount of 637 million US dollars, an increase of 12.42% over the same period of 2016, accounting for 24.3% of the LED export market. .
In 2017, the export product type of Q1 was the same as that of 2016. Excluding 36.98% of the unspecified lamps, bulbs, tube lamps and light bars are still in the top three positions. Bulbs ranked first with a total export value of US$132 million, accounting for 20.75%, an increase of 126.87% over the same period in 2016. The second place is the tube lamp, with a total export value of 58.75 million US dollars, accounting for 9.23%, an increase of 33.21%. The third place is the light bar, with a total export value of 40.65 million US dollars, accounting for 6.39%, down 13.4% year-on-year. In the first quarter of 2017, among the countries along the “Belt and Road” export of LED lighting products in China, Russia won the championship with a price of US$57.52 million, a decrease of 11.4% compared with the same period of 2016. Poland ranked second with US$52.53 million, a year-on-year increase of 3.14%. The third runner-up was India, which imported 45.14 million US dollars of LED lighting products, a year-on-year increase of 46.94%.
Under the Belt and Road strategy, what should Chinese LED companies do? Some experts suggest that we should seize the favorable opportunity of the "One Belt, One Road" strategy, focus on the new pattern of global economic development, grasp the new direction of China's economic cooperation, give play to the new advantages of China's LED industry competition, combine new foreign demand, do a good job in planning and design, and coordinate overall coordination. The classification policy will promote the “going out” of domestic equipment, technology, standards and services, realize the improvement from product output to industry output, and promote the transformation and upgrading of China's LED industry.
In fact, with the continuous deepening of the “Belt and Road Initiative” initiative, the overseas layout of Chinese LED companies is more diversified. Chinese LED companies actively go global through various means such as cross-border mergers and acquisitions, overseas factories, and engineering contracting. They leverage international market channels, existing brand values ??of international companies, and core patent technologies to avoid intellectual property dispute risks and enhance international competition. force.
In addition to the opportunities, LED companies will face many challenges along the Belt and Road. For enterprises, an important challenge is how to deal with the relationship between internationalization and localization, and avoid "acclimatism."
