It is a well-known fact that China is among the leading exporters in the world
- China has achieved this position due to its manufacturing prowess and its ability to adapt to different technologies
- It also has access to a large labour base which is cost-effective compared to Western countries
- China’s most-exported product around the world is electrical machinery
- Chinese machinery is used for a wide range of purposes, including industrial use, commercial use, as well as residential use
This blog discusses the export of electrical machinery from China and discusses the key reasons why this product continues to be vital in global trade
Key Reasons Why Electrical Machinery Continues to be China’s top export
During the year 2019, the export of electrical machinery and equipment from China amounted to $671 billion
- This represents nearly 26.9% of the total exports from the Asian nation
- Electrical machinery is by far the most exported product from China. The second-most exported product is computer machinery, which accounts for less than 17% as of 2019
Electrical machinery was not always the top exported product from China. This product has gained the number one position in recent years, as the Chinese manufacturing capabilities have moved up the value chain
- In the past few decades, China used to focus on exporting components and parts
- However, this situation has now changed, as the country wants to increase its exports
- China is now exporting entire machines, rather than building individual parts
- Regions such as Ningbo and Shanghai have emerged as hubs for the production of electrical machinery
Another important factor that is driving the growth of these exports is that China is now deploying robots in its factories
- These robots are highly efficient, and they are able to do the work that was previously conducted by humans
- The rate of errors has also come down significantly
- China exports its electrical machinery to a wide range of countries, including the US and India
- In addition to this, Chinese electrical machinery is also exported to several countries in Europe as well as Africa
There are numerous reasons why electrical machinery continues to be the most exported product from China
- Firstly, the products manufactured by the East Asian nation are considered to be highly cost-effective. This means that importers from around the world are keen to place large orders from China
- Secondly, China makes use of the latest technologies in order to develop such machinery. China’s factories have the ability to adopt new technologies at an early stage, thereby ensuring that the end-user is able to reap the benefits provided by it
- Thirdly, Chinese exporters also allow their trade partners to pay using a wide range of mechanisms. These mechanisms ensure that paying for Chinese goods becomes much more convenient
To conclude, it is clear that there are several reasons why electrical machinery continues to be China’s top export. Importers from around the world prefer to trade with Chinese manufacturers. This is a significant change from the past when German machinery used to be the market leader. Institutions such as Euro Exim Bank offer customized support to traders in the form of financial instruments and bespoke trade advisory services. Euro Exim Bank offers financial instruments such as Bank Guarantees and Letters of Credit (LCs). Further information about Euro Exim Bank and its key product offerings is available here.
