Foreign large companies have created giants in the newsprint industry through mergers and acquisitions. The world’s top five newsprint companies account for 35% of the world’s total newsprint production capacity; the top 10 newsprint companies account for 54% of the total world newsprint production capacity. Because mergers and acquisitions between companies are lower than the cost of establishing new businesses and high investment returns, international mergers and acquisitions have become the trend of the world's paper industry.
The emergence of foreign giant paper companies has transformed the world paper market structure from monopoly competition to oligopoly. Under such a market structure, the development of small and medium-sized enterprises will become increasingly difficult.
The development of domestic enterprises mainly depends on their own funds and state loans. However, due to their lack of accumulation and the country's construction funding, it is impossible to build large-scale enterprises immediately. In the face of international competition, China’s papermaking companies are now “smoothing themselvesâ€, and domestic companies have more competition and less cooperation. The country’s support policy is sunny and lacks focus. Take newsprint as an example, major domestic paper mills are undergoing transformation, and each company’s new scale does not exceed 150,000 tons.
The situation in which each country fights itself is in stark contrast to the wave of foreign mergers and reorganizations.
Without internationalization, China’s paper industry has no way out; if it engages in internationalization, it poses a threat to the survival and development of state-owned large and medium-sized enterprises. The harsh reality requires that China's paper industry must come up with a set of practical development ideas.
Second, the development of ideas for China's paper industry 1. China's paper industry to meet the needs of social paper must take the road of internationalization of the use of foreign capital Paper industry is a capital-intensive industry. It is predicted that from now until 2010, China's paper industry needs to invest at least 200 billion yuan to keep up with the growth rate of consumption. With limited investment capacity in the country, foreign capital must be used to meet China's demand for paper. Any attempt to protect national industries and support state-owned enterprises and oppose the entry of foreign capital is narrow and harmful.
The entry of foreign capital will ease the contradiction between the accelerated development of China's paper industry and the shortage of funds, and will be very beneficial to accelerating the modernization process of China's paper industry. The country has done a great deal of hard work to support the development of the paper industry. However, to fully meet the development needs, the use of foreign capital is not optional. Otherwise, the output and quality of domestic enterprises can not meet the needs of society, which will lead to a large influx of foreign paper products, which will cause greater impact and damage to domestic companies. To meet the needs of social papermaking as a prerequisite for decision-making is the key to forming correct development ideas.
2. In the face of a huge market, papermaking companies should be fully prepared to respond to the rapid development of the industry. The paper industry is a rare industry that is in short supply and has great market potential. It is very important to correctly predict the speed of development of the industry, and thus to make preparations for ideological and material advances in order to adapt to fierce market competition.
There are currently many models for studying the speed of the paper industry. Some people have used the mathematical regression method to sum up the speed of the paper industry in the past and the growth rate of gross domestic product (GDP), and then predict the future development rate of the paper industry according to the speed of the national GDP.
Development comes from investment. Because the paper industry invests heavily, the past was mainly invested by the state. The speed of development of the paper industry is based on the country's arrangement of investment and speed control according to the GDP plan. It is not the intrinsic law of the development of the paper industry that is related to GDP growth. The speed is consistent.
With the increase of investment autonomy of commercial banks and the entry of foreign capital, the market demand will become the main factor determining the speed of development. As the product gap on the market is large, the pace of development of China's paper industry is likely to exceed the forecast value to a large extent, especially in the individual varieties, there will be unexpected rapid growth. (to be continued)