"It's so far not threatening to the competitiveness position of China because it's the very low-end of manufacturing sectors that are affected," Louis Kuijs, chief China economist at Royal Bank of Scotland in Hong Kong, said.
Under government guidance on foreign investment issued in December 2011, China aims to lure more FDI in advanced manufacturing, as well as services, including logistics, research and development, higher education and vocational training.
"The government policy no longer encourages FDI in the low-end manufacturing, only firms that are up in the global value chain can make profits," said Li Yushi, senior economist at the Commerce Ministry's think-tank - the Chinese Academy of International Trade and Economic Cooperation.
Extensive operations
That fact is recognized by the likes of Marjorie Yang, chairman of Hong Kong-based Esquel - the world's biggest maker of premium cotton shirts for the likes of Ralph Lauren, Tommy Hilfiger, Nike, J.Crew, Brooks Brothers, Hugo Boss, Lacoste, Bestseller and Muji - which has extensive operations across China.
"There is pressure on enterprises in China to transform from being cheap labor-driven to innovation-driven," Yang told a forum in Beijing last weekend, adding that rising wage costs had forced cost-cutting elsewhere in the business in response.
Some factories in the clothing and footwear industries have closed. German sportswear maker Adidas AG has shut its only directly-owned factory in China, but it still sources goods from local suppliers.
Bullet train attendants receive trainings in China's Shenyang
Feedback
RSS
