In the context of global economic fragmentation, China’s economic management and development model is becoming increasingly attractive, especially to some countries in Asia, Africa and emerging markets, because they need a successful model. Among them, Ethiopia is the country most expected to become the next manufacturing center in Africa, and has been China’s largest trading partner in Africa for 10 consecutive years.
This country has a population of more than 100 million The country of Ethiopia is located in the center of the Horn of Africa and is the gateway to the African market. It is very attractive to investors. For example, it has low-cost labor, convenient transportation and a huge consumer market. According to the analysis of the American Quartz Financial Network, it is expected to become For a country that is developing its economy like China, what is happening now can be called an economic miracle. It is betting that it can become the next Chinese economy. It has now become the largest economy in East Africa.
Addis Ababa, the capital of Ethiopia
According to the CNBC website Quoting the predictions of the president of Ethiopia’s C. Bank, it is estimated that the country’s average annual growth rate will be 10% in the next three years. The foreign media stated that since 1991 to the present, Ethiopia has relied on China’s economic development amid a lack of national resources. Using the model as a template, China has invested heavily, actively developed infrastructure and manufacturing, and formulated an economic development plan led by government departments. Therefore, it is also called the African version of the Chinese economy by international media. At the same time, it is now gradually becoming one of the overseas travel destination options for Chinese people, and the number of tourists visiting the country has increased to 2.5 million annually.
For example, Ethiopia launched its first satellite on December 20 with the help of Chinese aerospace companies. This is a milestone for this country with ambitions to develop its economy. The achievement marked a banner year for Africa’s involvement in space, and officials from the country said: “This will form the basis of a path to prosperity in our history.”
At the same time, a US$1 billion riverside green development project in Addis Ababa was launched in October 2019. In November, among Chinese e-commerce companies With the help, Ethiopia has become the second African country to join the World Electronic Trade Platform after Rwanda.
Addis Ababa, the capital of Ethiopia
Latest news display , in order to promote economic development, the Egyptian government is also implementing the second phase of its growth and transformation plan to create more infrastructure needed to serve the economy, making Egypt a manufacturing center and attracting foreign direct investment. For example, it is currently working on It aims to develop the local capital market and plans to open a stock exchange in 2020.
At the same time, another Southeast Asian country, Vietnam, is also formulating a draft to manage e-commerce activities to promote the development of the e-commerce industry, according to Vietnam’s 2019 “E-Commerce Index Report” , in the past three years, the average growth rate of e-commerce in Vietnam has exceeded 25%. The report also stated that by 2025, Vietnam will become the third largest e-commerce market in Southeast Asia, second only to Indonesia and Thailand.
Behind this, Vietnam also hopes to become a manufacturing powerhouse by learning from China’s successful economic experience, like Ethiopia, and was once praised as the most likely to become the next China. , the latest data shows that Vietnam’s economy performed well in 2019, with GDP growing by an estimated 6.8%, while public debt has also reduced by nearly 8 percentage points since 2016, and the trade surplus has maintained growth for the fourth consecutive year, amid a global economic slowdown. Against the backdrop of slowdown, these results are striking.
According to World Bank data, because Vietnam’s land and labor resources are cheap, it has learned from China in attracting foreign investment in the manufacturing industry. Based on the experience, per capita GDP soon began to rise rapidly, and all this is somewhat similar to China twenty or thirty years ago. In recent years, Vietnam has been opening up its market more and more, and more and more foreign investment has poured into Vietnam.
But in fact, Vietnam is still a low-income country, and it also faces some problems, such as slow economic system transformation, low processing value, low labor productivity, and educational restrictions. , HSBC said in its latest report that as Vietnam may approach the country’s legal debt ratio limit of 65% of GDP at some point in 2019, it ranked the country as the country in Southeast Asia that most needs to consolidate its finances.
In response, the US rating agency Moody’s also downgraded Vietnam’s latest rating action in a report released on December 18, confirming the Vietnamese government’s Ba3 domestic and foreign currency Issuer and senior unsecured ratings, and changed the outlook to negative, such as the risk of the Vietnamese government delaying debt and interest payments.
A corner of a Vietnamese city
According to data from the Central Bank of Vietnam, Vietnam’s foreign reserves are only US$63.5 billion, but according to a report by the Saigon Economic Times in March, Vietnam’s total debt has exceeded US$125 billion. Royal Bank of Canada also believes that Vietnam’s borrowing capacity is very limited and its ability to withstand global economic uncertainty is particularly weak. It has always needed funds to help cover its budget deficit. This is the latest news from Moody’s and HSBC This has been confirmed in published reports.
In fact, Vietnam’s economy at this moment is particularly reminiscent of India, which is known as the “banana economy country”. At that time, some foreign media and economists praised it. After India, which has a rapid economic growth, and believes that India has achieved great success in learning from the Chinese economic model, however, since India launched a series of economic and financial measures such as demonetization in November 2016, the Indian economy has continued to decline. Growth has rarely fallen in six quarters and is stuck in a dollar debt deficit dilemma. The so-called banana economy country refers to an economic system that belongs to a single economy (usually cash crops such as bananas, cocoa, coffee, etc.) and has an unstable economic environment, especially A derogatory term for countries in which powerful foreign economic forces are involved.
Data show that although Vietnam’s economy is undergoing various reforms, Vietnam is still a country dominated by agriculture. Agricultural production, especially food production, plays an extremely important role in Vietnam’s economy. Agriculture accounts for 10% of the national population. 30% of the GDP, and the agricultural population accounts for 80% of Vietnam’s total population. For example, due to its advantageous coastline, Vietnam’s aquatic products occupy a large share in the world. However, in the context of the global economic slowdown and rising trade barriers, In the first half of this year, Vietnam’s aquatic product exports experienced a double-digit decline year-on-year, and exports to the EU and South Korean markets continued to decline.
Based on this, some people believe that Vietnam’s current economic situation cannot become the next Chinese economy, but is more like a “banana economy country” like the Indian economy, because at this time Vietnam seems to be more like the Indian economy that is eager for success. Reuters also reported earlier that Vietnam’s economy is becoming a victim of the US dollar debt debt trap. Under the burden of high fiscal deficits, it is very likely that the Indian economy will suffer. Reprint.
Africa will be the last “new continent” in the apparel industry
This All stem from the increasing saturation of other global clothing markets and the swelling of various corporate costs, and the financial crisis sweeping the world has contributed to the situation.
Africa is close to the European and American markets and has important cotton-producing areas. The merchants are also “very cooperative”. Compared with East and Southeast Asian countries, in addition to cheap labor, it is cheaper to transport clothing to Europe or the United States in East African countries. In addition, African countries signed a special trade agreement with the United States in 2000, and American clothing enters the African market duty-free. As the local cotton industry in Africa develops, local resources can be purchased to further reduce costs.
H&M and Primark international giants began to purchase from Ethiopia
International giants H&M, Tesco, Primark and other companies have also begun purchasing from Ethiopia because the country has no minimum monthly salary restrictions. For unskilled workers, the monthly salary is only 35 to 40 US dollars, which is obviously much lower than that in Myanmar. These foreign clothing manufacturers are very popular in African countries, and they also benefit from the abundant local cheap labor and energy. Kenya’s garment industry is also developing. Although the monthly salary in the country is about US$120, the government attracts these foreign businessmen with generous incentives.
The garment industry is one of the main pillar industries in Africa
The main participants in the world’s textile and apparel market and important customers in the cotton market are mainly from Asia, of which China accounts for a large proportion.
The garment industry is one of the main pillar industries in Africa. Southeast Africa has the most dynamic textile industry in Africa and is an important cotton-producing area. In recent years, it has attracted more A lot of money. Chinese companies can bring advanced technology and management methods to Southeast African countries, helping to improve local production processes; and try to transfer large-scale clothing production processes to realize the overall transfer of the clothing industry and related supporting industries to Southeast Africa. </p
