Back in 2008, Sun Qiuliang’s company generated about $1.6 million selling flashlights in the Chinese trade hub of Yiwu. This year, business has almost dried up.
“The mobile phone for my shop sometimes doesn’t ring for a month,” said Sun, 33, sales manager of his family’s Liyuan Flashlight Works. “In the good old days there would be one or two orders every day.”
Sun’s plight is shared by small businesspeople across the eastern city, a center for the export of cheap products from hair bands to bracelets. Chinese trade figures for March due tomorrow are projected to show growth below the government’s target for the full year even after a slide in the yuan, underscoring the urgency for Premier Li Keqiang to find alternative economic drivers.
“I don’t see a future for these places if they continue to make low-end products,” said Ding Shuang, senior China economist at Citigroup Inc. in Hong Kong. “They have to restructure their products and move up the value chain, and that applies to China more broadly.”