By: Liu Zhiqin Source:Global Times Published: 2020-02-20
Combating novel coronavirus pneumonia (COVID-19) could trigger an earth-shaking change in the world's healthcare industry supply chain. China is set to expand its supply chain in the healthcare industry.
China can be the base camp for this radical reform. The country will become both the producer and market of medical products. Financial services, research institutes and biotechnology development related to virus containment have tremendous market value - China can't pass up this opportunity for a strategic shift.
The revolutionary change that China is about to bring will recalibrate the roles and conditions of the healthcare supply chain, putting the responsibilities and moral bottom lines of each link to the test.
China should enlarge the supply chain to a supply circle while fighting the virus, to counter the uncertainties of the international trade environment down the road. A supply circle has more leeway and development options than a supply chain.
During the just concluded Munich Security Conference, some Western politicians held discriminatory and hostile attitudes toward China. They thought they could use the COVID-19 outbreak as chance to add insult to China's injury, using drastic measures to create a difficult international environment. If China is straitened both domestically and internationally, they can reap the profits and push China out of the global supply chain, achieving a new world order and rules that they dominate.
However, the epidemic has united Chinese people as a whole, revealing to the world the hypocritical nature of some Western politicians and improving China's influence in the global supply chain. China's soft and hard powers have been maximized through this crisis. The tenacity and spirit of Chinese people has proven that China has the ability to maintain its irreplaceable position in the global supply chain.
China has not forgotten to contribute to the world's sustainable development while trying its utmost to extinguish the epidemic. Since the outbreak began, there have been doubts over whether or not the nation can continue to provide the necessary products that world trade system needs. Western media has jumped at the opportunity to tout a "China collapse." Some have even advocated for a decoupling from China or said that profits could be made from this disaster. They intend to shake up the current global supply chain order, squeezing China out.
China must remain in the global supply chain and, at the same time, build a global supply circle. Centered on manufacturing and business in China and other developing nations, a circle that includes every industry and every production link can be formed to prepare for an upgrading of the global supply system.
A supply circle is more inclusive than a supply chain, which connects through upper and lower streams and is highly interdependent. A global supply circle would not only include a vertical supply relationship, but also a horizontal interdependence that would improve the function of each individual link. In such a system, one entity could offer products from multiple directions. Therefore, a supply circle could provide companies more development opportunities, allowing them to remain competitive. This is crucial for Chinese firms that are fighting against the virus.
Chinese companies have shown dedication, responsibility and compassion during the COVID-19 outbreak, and have convinced international society that they are reliable and trustworthy partners.
The world's leading small commodities market in Yiwu, East China's Zhejiang Province has reopened. It is a barometer of China's international trade situation, and as long as Yiwu is still in business, the Chinese market's bright prospects will not change.
Combating the coronavirus and maintaining economic development are equally important. This has become the consensus of Chinese society. Chinese people, despite their careers or industries, know their responsibilities well. On one hand, they are trying to reduce the impact of the epidemic on the world economy. On the other hand, they are giving their firm support to the world's economic revival, favoring balanced development in international trade.
China should build and push through a global supply circle. The country will amplify its production and market, drive global economic recovery, and eventually benefit people from all economies.
The author is a senior research fellow of the Chongyang Institute for Financial Studies at Renmin University of China.