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Manufacturers add value, reap rewards

By Wang Lan (China Daily)
Updated: 2007-08-04 09:46

SHANGHAI: Profit margins at the city's process manufacturers are increasing as they add more value to products and services.

The value-added rate, which is widely taken as an indicator of production efficiency, jumped to 97.6 percent in the first half of the year - up 20 percentage points from a year earlier, according to the Shanghai Foreign Economic Relations and Trade Commission (SFERTC).

The export value of Shanghai's processed goods in the first six months of this year amounted to $35.3 billion, a year-on-year increase of 18 percent. The import value amounted to $18 billion, up 7 percent from a year earlier.

Trade officials and economists said that the improvement in efficiency is a clear indication that upgrades and restructuring at the city's manufacturers are in full swing. "Our industries are rapidly moving up the value-added chain by introducing greater elements of research and development into their products," said Luo Zhisong, deputy director of the foreign trade planning and operation department of the SFERTC.

Luo said that the fast expansion of the services sector has also helped boost the value-added rate for total trade.

Statistics from the SFERTC show that international technology and components products were the top two growth areas in terms of processed goods with added value in the first half.

Luo said that the increase in the value-added rate of processed goods would benefit the manufacturing industry and lead to a more balanced trading structure.

"Service trade is going to account for an increasing share of Shanghai's total trade structure in the coming years," Luo said.


(For more biz stories, please visit Industry Updates)

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