Strategic observation

China Focus: A small city's rise to prosperity

2018-07-11 22:17:29 (Beijing Time)         English.news.cn

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FUZHOU, July 11 (Xinhua) -- Some 38 years ago, Ding Hemu sold all his valuable belongings and gathered 1,000 yuan (about 151 U.S. dollars) to start a small shoe-making workshop, hoping to feed his family.

With per capita land of just 0.03 hectare, however, it was hard to make ends meet in Jinjiang through farming back then.

Now, Ding has made his small family business into a sportswear empire of world fame. He has also become an icon in Jinjiang, now a small coastal city in east China's Fujian Province.

ANTA, which was set up by Ding in 1991, is now China's most valuable sports brand with a market value of more than 100 billion Hong Kong dollars, making it the third in the industry globally in terms of market value, after only Nike and Adidas.

Ding is just one of the city's thousands of entrepreneurs who have helped transforming the previously poor county in the late 1970s into the country's top 10 richest county-level cities in the new century and a role model for over 2,800 county-level districts across China rushing to achieve prosperity.

Covering just one two-hundredth of Fujian's area, Jinjiang created over 6 percent of the province's GDP in 2017. It has 46 listed companies and 50,000 private enterprises.

Over the past four decades, the city has developed an economic model focusing on the real economy and private enterprises, nurturing a number of famous brands including China's largest tissue paper manufacturer, Hengan Group, and sportswear giants ANTA, Xtep and Septwolves. One in five pairs of sports shoes in the world is produced in Jinjiang.

The path of economic development, with a market-led and export-oriented economy and a booming private manufacturing sector, has been called the "Jinjiang Model."

When Xi Jinping worked in Fujian between 1985 and 2002, he inspected Jinjiang seven times. Summarizing Jinjiang's success story in 2002, he said the city's achievements were due to a localized market-oriented economy, hard-working locals, honest market players and effective local government.

"Xi's thoughts on Jinjiang's development are never outdated," said Gao Ming, a Fuzhou University professor. "The spirit of reform and opening-up within Jinjiang's development in the past four decades can also guide China's development in the new era."

FOCUSING ON THE REAL ECONOMY

As a local proverb goes, "barren land might not produce good crops but gold." It was poverty that forced Jinjiang people to change.

"Only by setting up your own business can your family live a good life," said Hong Zhaoming, who set up his clothing workshop in 1984 at Yinglin Village after peddling fruit, pork, fertilizer and rice for years. He later created K-Boxing, a top jacket brand in China.

Since China's reform and opening-up in 1978, merchants from Jinjiang have made use of the city's geographic advantage to sell goods from overseas to other parts of China.

In the early years of opening-up, setting up business needed courage not only from entrepreneurs, but also from local governments.

Private employment was a sensitive issue when China began to shift from a planned economy to a market one. The Jinjiang government gave the green light to private financing to start enterprises, employ workers, distribute dividends, and to market-based pricing, making Jinjiang a pioneer of China's rural industrialization.

As early as 1984, Chendai Township where most of Jinjiang's private enterprises were located, became the first township in the province to have a total industrial and agricultural output of over 100 million yuan.

In the same year, Jinjiang welcomed the first batch of foreign investors, many of whom were overseas Chinese with Jinjiang as their ancestral home. In 1994, the number of foreign-funded enterprises reached 1,000, with a total production value of more than 8 billion yuan.

In 1998, Hengan Group, which started as a sanitary towel maker, became the first listed company in Jinjiang. Now it has 46 listed companies with a market value of more than 180 billion yuan.

In 2005, ANTA set up China's first high-tech sports science lab. It has also set up design centers in the United States, Japan and the Republic of Korea, achieving Jinjiang manufacturers' ambitions of going global.

"We don't want to be China's Nike, but the world's ANTA," said its chairman and CEO Ding Shizhong, who is eyeing a dominant role in the Chinese market with an expected yearly revenue of more than 100 billion yuan by 2025.

Thanks to the booming private sector, Jinjiang now has two industries, textiles and clothing, as well as shoe making, with a production value of more than 100 billion yuan, and five industries with a production value of more than 10 billion yuan.

In spite of rising labor costs, market competition and the lure of making fast money in the capital market, entrepreneurs in Jinjiang still focus on their traditional products: shoes, jackets, paper, sweets and umbrellas.

"Their insistence on the real economy and continuous efforts in innovation to make products better and smarter are the key to Jinjiang's success," said Gao Ming, the professor with Fuzhou University.

Graphene, widely used in the electronics industry, is now being applied by Guirenniao Co. Ltd, to produce the world's lightest sports shoes with a weight of only 120 grams.

With decades of market competition and innovation, Jinjiang has shaken off its former image as a production base for rural low-end commodities. And it is spreading its experience to neighboring counties, making Quanzhou, which administers Jinjiang, into China's top producer of clothing, sanitary ware, stone sculpture and art ceramics.

"We will continue to focus on the real economy with higher quality, while being more efficient, more equitable and with more sustainable development," said Liu Wenru, Party chief of Jinjiang.