Wenzhou – shoe capital of China
When driving in
The private sector now accounts for at least one-third of the national economy. Nobody knows the exact figure, because there is no clear definition of a private firm, nor whether it includes foreign-invested companies and the thousands of collectives and state firms that have been privatised but prefer to retain their former status for political convenience. What is agreed is that, while the state sector is shrinking, private business is the most dynamic part of the economy, creating jobs and wealth and taking on hundreds of thousands of workers from state firms. The wealthiest parts of China are those where the private sector is most developed and the poorest are those where it is weakest.
It is therefore no surprise to find that Wenzhou appears a generally prosperous city. Among its claims to fame, it is one of China’s seven centres of the leather and shoe industry and in October 2001 was formally awarded the title of China Shoe Capital by the China Leather Industry Federation. Chen XiQiang, Director-General of the Wenzhou Leather Industry Association claims there are over 4,000 shoe and leather related enterprises in and around the city. Together they employ some 350,000 people which, in any country outside China (barring India perhaps), is a huge number. In 2001 Wenzhou produced footwear valued at $3.14 billion - 6.8 percent up on the previous year and continued growth seems likely.
Official statistics in China should always be treated with a degree of caution but, in this instance, they are probably not far off the mark. Mr. Chen believes much of this success lies in an abundant supply of skilled labour and an infrastructure, supplying everything from shoe machinery to chemicals and design through to final production. But the city is not resting on its laurels. A 6.5 square kilometre ‘China Shoe Capital Industry Zone’ is under construction, to group together vital support functions such as scientific research, trading, pooling of information, etc. The city certainly benefits from a spread of industry related skills and activities which may owe its origins to an interesting source. Many people went to nearby Shanghai in search of work. The latter, however, keen to develop as China’s financial and services centre, has done little to encourage small and medium-sized enterprises. So, with some experience and enough money to get started, the immigrants returned to their native city and set up in business. Local government has been sympathetic to such enterprise - not in the sense of turning a blind-eye to unacceptable practices in terms of pollution - but in encouraging successful industries, even if they are in perceived ‘sunset’ fields such as leather. Being reasonably close to China’s financial powerhouse of Shanghai also has practical advantages, for overseas business people.
Wenzhou hosts its own International Shoe Machinery & Raw Materials Exhibition. Now in its seventh year, the 2002 four-day event was held at the newly constructed Wenzhou International Convention & Exhibition Centre in November. This could be described as a ‘work in progress’ but shows signs of promise when completed. A mix of bad weather, and a public transport system that appeared unaware the Centre is operational, may have kept numbers down. Nonetheless, the organisers claimed just over 24,000 visitors, with some 400 exhibitors (nearly 50 percent of them from overseas) in almost 1,000 booths. They also said total business reached $83.5 million, of which $3.7 million was in signed contracts and the remaining $49.8 million in intended contracts.
One of the companies that showed was Newlast srl. According to Ermanno Colombo, its production manager, excellent results were experience. The company exhibited its top products, the NL.SF6 last finisher and DGT mechanical digitiser, together with three CAD/CAM prototyping software programmes, Easylast 3D, Easycut 2D and its new Easyheel 3D. Chinese companies are increasingly willing to buy advanced systems and Newlast has found that its technology, offering high productivity, manufacturing precision and innovative design capabilities, is what they want.
Wenzhou includes some 160 last makers, who produced about 600 million pairs of lasts per year. “Chinese last makers have embraced this latest technology and like the fact that it is so flexible. In less than three years and with a still incomplete sales network, Newlast has already installed 160 machines in China and is now market leader in this sector,” Mr Colombo said.
