Global market competition promotes dynamic equilibrium of supply and demand

Recently, some people in the United States have been hyping up the "China overcapacity theory" and "China's production capacity impact theory." The National Development and Reform Commission and other departments have responded forcefully. Some far-sighted people in the world have refuted them, believing that these arguments have no factual basis and "would rather Blaming others for your own failures rather than facing reality.”

French entrepreneur Arnold Bertrand pointed out in an article that based on the analysis of three key indicators: capacity utilization, inventory levels and profit margins, there is currently no sign of "overcapacity" in China. Bloomberg analysis shows that in the field of electric vehicles, the capacity utilization rates of most of China's top auto exporters are at internationally recognized normal levels. If the so-called "overcapacity" and "low-price dumping" really exist, then the price of products in the international market should continue to be low. But in fact, the price of some new energy vehicles exported from China is higher than that of local electric models. Data show that in 2019, the average export price of each new energy vehicle in China was US$5,000, which increased to US$22,000 in 2022. The average export price to Europe that year reached US$30,000.

In the context of economic globalization, when looking at production capacity issues, we should uphold the principles of market economy and the laws of value. From a market perspective, production capacity is determined by the relationship between supply and demand. Under market economic conditions, the balance of supply and demand is relative, and imbalance is common. Take the development of mobile communication tools as an example. From expensive mobile phones, to portable and convenient PHS, to powerful smartphones, the dynamic balance of market supply and demand has not only achieved iterative upgrades in product performance, but also brought about Substantial reduction in product prices. The same is true in the field of new energy vehicles. Currently, the demand for green products in China and even the world is surging. High-quality production capacity is not only not excessive, but also can drive more effective demand. In fact, reasonable and moderate production exceeding demand is conducive to full competition and survival of the fittest, and helps to encourage micro entities to improve management and technology and improve efficiency. In industries where supply exceeds demand for a long time, micro entities often have no incentive to update technology and improve services.

Under the conditions of economic globalization, different countries have larger production capacity in their respective strong industries and smaller production capacity in other industries. This is determined by the comparative advantages of each country and is in line with the objective laws of economic development. Taking the new energy vehicle industry as an example, China accounts for about 70% of the world's new energy vehicle patent disclosures; the world's only new energy vehicle "lighthouse factory" is located in Guangzhou, Guangdong; in the Yangtze River Delta, the supporting parts required for a car , all can be solved within a 4-hour drive... China's new energy products are highly competitive in the market, mainly because related industries have accumulated technological advantages through long-term R&D investment, and at the same time rely on domestic strong industrial supporting capabilities and ultra-large scale The market, abundant human resources, etc. have formed a comprehensive competitive advantage, which is formed through continuous technological innovation and sufficient market competition. By leveraging comparative advantages to promote technological innovation and cost reduction, consumers in various countries can obtain better products and services at lower costs. This is also the significance of global division of labor and cooperation.

Fair competition is a basic principle of market economy. Only by promoting the dynamic balance of supply and demand and realizing the survival of the fittest through global market competition can we truly shape industrial competitive advantages. It should be noted that industrial subsidies are a common practice around the world. Many countries in the United States and Europe have them. Some countries have more subsidy projects, wider coverage, and larger subsidy amounts. The United States has provided trillions of dollars in subsidies to the domestic clean energy industry. . China's new energy industry advantages are achieved through real skills, not through government subsidies. Accusing the Chinese government's subsidies in related fields of distorting factors and product prices is undoubtedly a false accusation. This kind of confusion of "subsidy is harmful, please put it down and let me take over" is aimed at seeking a more favorable competitive position and market advantage for the country. Outright economic coercion and bullying. We hope that relevant countries will uphold an open mind, adhere to fair competition, create an international, market-oriented, and law-based economic and trade cooperation environment, and work with China to achieve common development, mutual benefit, and win-win results.