Guangzhou news (July 28, 2009), when manufacturing companies around the world are still looking for signs of economic recovery, China's local plastics companies seem to have come to the bottom, thanks to China's massive economic stimulus plan.

Many of the industry's leading plastic companies say their domestic market business is recovering to the pre crisis level. There is a market forecast that the plastic industry will resume the overall level of two digit growth in the second half of this year.

However, any possible recovery may be unbalanced and fragile, because the overcapacity of manufacturing enterprises is still serious, and China's export market is still struggling, especially for manufacturing centers in Guangdong province.

However, some companies also believe that domestic demand will remain strong, especially local construction, automotive and electronic markets.

Composite manufacturers, located in Guangdong Guangzhou headquarters Chinese largest blonde Polytron Technologies Inc Willis, vice president of global sales and marketing Guan told us "Plastics News" said: "from the point of view of our order, it can be said that we have been basically out of the depression." But like other peers, he also said it is hard to say whether the improvement is long, because sales began to revert to the level before the crisis in the past 1 or 2 months.

Ningbo Haitian Plastic Machinery Group, the largest manufacturer of injection machines in China, said its domestic sales have climbed to the pre crisis level since April. Haitian a manager told us "Plastics News" in the NPE2009 exhibition, China government issued 4 trillion yuan of the stimulus has helped to restore consumer confidence, and ultimately promote the recovery in orders, but he also said, because the update of the product portfolio may be much more than the Haitian domestic manufacturing other circumstances better.

Some signs of economic recovery can be seen from the statistics. In June, China's largest plastics trade association, China Plastics Processing Industry Association, predicted that the industry growth in the second half of this year will rise to over 10% from the beginning of the year.

China's Ministry of industry and information technology says the production of plastic final products has increased by more than 7% in the first 5 months of this year, although exports in the same period have declined by 12%. In a more broad range, China's GDP growth in the two quarter has increased from 6.1% to 7.9% in the first quarter.

From this trend of growth, it can be seen that Chinese enterprises are getting rid of their dependence on exports and are more focused on their own markets. Helmar Franz, executive vice president of Haitian Group, headquartered in Ningbo, Zhejiang, said: "we see some structural changes in China's plastics processing industry, and our customers begin to compensate for the export decline by domestic market, which is driving the growth of demand. Chinese molding enterprises can quickly adapt to the new environment. " But for some export oriented enterprises, the situation is still very severe. Alfred Au, vice chairman of the Hongkong Mold Association, said exports, such as mobile phones and electronic moulds, have declined by 50%. He said, Chinese overcapacity in manufacturing industry production capacity, the Hongkong businessman Victor Lo agrees, he had been estimated in June, mainly engaged in export of Southern China area is about 30-40% of the excess capacity. Au said: "most of the utilization rate is only 30-40% in manufacturing enterprises now capacity." He thinks the change is permanent, and the brilliance and prosperity that Chinese manufacturing enterprises once owned will be gone. Served as the general manager of Hongkong yingmo technology company Au said: "I think the golden age has passed. This is not a problem of seasonal recession. We are facing an unprecedented complex situation. " Chinese extruder manufacturer Nanjing giant Machinery Co Ltd said, signs of recovery are apparent. The company is currently selling about 80% of its pre - crisis sales level, much better than 50% at the beginning of the year.

Huo Qingxian, the general manager of the company based in Nanjing, Jiangsu, says it is not clear whether the situation will continue to improve in the next few months. He says the company's business is still not getting better, and customers are still demanding a big price reduction: "everyone is waiting." Everyone wants to cover up his purse. " Some of the companies interviewed revealed that they were investing.

Guangzhou blonde plans to build a new bio plastic production plant in Zhuhai, Guangdong. Hongkong Shang Yi Xing composite production Co. Ltd. to build a small factory in Hongkong to take advantage of Po, Hongkong and the mainland signed the closer economic cooperation agreement with the tariff advantage.

Yixing for director Anthony Wong told us "Plastics News", the company in China, business has been restored to the level before the crisis, and is still in steady growth, while the export business is also showing some signs of recovery, although this sign is not obvious.

But he said, in short, China's economy is not isolated, and whether it can improve in a comprehensive way will depend on the recovery of other countries in the world: "the future trend of China's economy is still closely related to the global economy."