Business / Companies

Walking in the footsteps of maritime silk road pioneers

(Xinhua) Updated: 2015-02-11 17:29

FUZHOU - Before the 21st Century Maritime Silk Route (MSR) initiative was unveiled, many firms had already taken steps to link China with countries along the ancient trade route.

"We have walked around the world," said Ding Pengwan, chief operating officer with Xidelang, a local sports shoemaker in Chendai in southeastern Fujian Province.

Ding is a descendant of the Arabian businessmen who settled in China after plying their trade along the silk road. The small town in Quanzhou City, where the MSR will start, is home to popular domestic sportswear brands such as 361 Degrees, PEAK and ANTA, all of which are run by similar businessmen that have already begun to tap into the potential of the developing countries along the MSR.

Treading overseas

PEAK, the first Chinese shoe maker to win NBA sponsorship, makes or sells shoes in over 80 countries and has plans to make this 100 countries, raking in 10 billion yuan ($1.63 billion) in overseas sales, in the near future.

ANTA and 361 Degrees are also eyeing European and Southeast Asian expansion through brand cooperation or the establishment of overseas branches.

Their ambitions are driven by the changing landscape of the sports shoes market: China's footwear export volume and sales plummeted in January, falling 13.5 percent and 10.9 percent respectively.

Like many manufacturing sectors in China, rising costs, workforce shortages and looming overcapacity have pushed Chinese shoemakers to capitalize on the vast market along the MSR.

"Pioneering courage and entrepreneurialism just runs in our blood," Ding said.

As a sector that relies on minimum outlays, manufacturing of footwear has shifted geographically inline with rising production costs.

Wearable, comfortable investment

The Huajian Group, one of China's largest footwear producers for the female market, which is based in the southern Chinese manufacturing hub of Dongguan, is now the largest shoemaker in Ethiopia.

Its products, labeled "Made in Ethiopia", produces over half of Ethiopia's shoe exports, which has boosted the growth of farming, leather processing, transportation, logistics and other related sectors. With daily output of over 5,000 pairs of shoes, Huajian employs over three thousand Ethiopians.

However, Huajian sees Ethiopia as more than just another overseas plant.

The private firm has tried to help boost the local economy by nurturing entrepreneurship in Ethiopia through skill transfer, a move lauded by Ernst & Young Ethiopia, which noted that building clusters around one or two major Ethiopian investors helped to foster competitive and comparative advantages that boost the country's economic independence and success.

There needs to be a deeper kind of connectivity for countries that are geographically connected, as shared values and development can lead to connectivity on other levels, said Sameh El-Shahat, CEO of China-i Limited, a risk management and public diplomacy advisory firm.

Huajian plans to create a new cluster of footwear production facilities that would export to the African, European, and American markets within a decade. It will work with the China-Africa Development Fund to invest $2 billion within the next few years, which will result in the creation of 100,000 jobs for Ethiopians.

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