By staff reporter LIU DONGPING

The 2002 China Light Industrial Products Fair. hosted by Wenzhou.

Clusters of garment, shoe and small commodity retail stores in Wenzhou, and the giant billboards soaring above each building advertising shoes and custom-made suits proclaim the city's thriving light industry. The most likely topic of conversation between patrons of local teahouses and restaurants is sales and supply information on various products. Wenzhou City is abuzz with commerce.

Wenzhou has long been developed in commerce and artisanship, leather shoe-makers having first appeared in the city in the Southern Song Dynasty (1127-1279). Its light industrial sector has since evolved to an unprecedented level, turning out over 50 categories of light industrial products -- half of the national total -- and providing jobs for two million local people. Its 2001 output value amounted to some 90 billion yuan, accounting for two-thirds of Wenzhou's total industrial sector. Wenzhou produces more than one billion pairs of shoes every year. Of its 2,000-odd garment factories, 200 boast an annual output of at least 50,000 suits or above, and 16 earn over 100 million yuan in sales.

Wenzhou's light industrial products hold substantial shares in the domestic market, accounting for 20 percent of leather shoes, 10 percent of garments, 95 percent of metal-cased lighters, 60 percent of razors, 50 percent of glasses, 65 percent of locks and 90 percent of color pens.

Wenzhou brands continue to gain in reputation throughout the country. It is site of three of China's top ten shoe factories, five of the top ten lock factories and six of the top 14 pen factories. Wenzhou is known as China's city of shoes, production base for lighters and razors, center for printing, and capital of locks and pens. Its light industry acts as main motor for the local economy.

In order to optimize its advantages in this sector, Wenzhou has set out to build itself into an international light industrial city.

Wenzhou took its cue at the beginning of China's opening and reform to develop a cottage industry, private economy and special markets, thereby creating the giant small-commodity market. In the mid-1980s Wenzhou's workshops and household businesses were among the first in China to merge into share-holding enterprises, thereby pooling small capital into substantive amounts. When in the 1990s other cities in China were scrambling for foreign investment, Wenzhou built its way into foreign markets by setting up enterprises out of China.

China's entry into the WTO and the acceleration of its globalization process means that Wenzhou is now obliged to prepare for, deal with and engage in international competition. By forging an international light industrial city, however, Wenzhou can promote adjustment of its industrial structure, upgrade its entire industrial sector, and sharpen its competitive edge.

During the Wenzhou International Light Industrial City Seminar, well-known economist Ai Feng argued that today's circumstances demand a collective performance on the part of Chinese enterprises, the city being the medium for enterprise incorporation. Wenzhou's strategy of making itself an international light industrial city conforms to China's current urban economical situation, and once accomplished, will act as an example of economic development to other areas of China.

Assembly line at the Red Damselfly Shoe Factory.

Wenzhou is increasingly making its presence felt in the world of light industry. During the China Light Industrial Products Fair hosted by Wenzhou in 2002, the city received a number of transnational businesses, including Chia Tai, Metro, Carrefour and Wal-Mart. Following Walmart's order for 350,000 pairs of shoes from Taima Co., the previous year, on its second trip to Wenzhou it made a further massive purchase. In addition, contracts worth US $15 million covering garments, food and general merchandise were signed between three French and five Wenzhou companies.

Wenzhou's private businesses have shown great vitality and flexibility within international competition. Yuetu Electric Appliances Co., exports 65 percent of its air-conditioners, 90 percent to the European market. These products are made especially for export. For instance, air-conditioners exported to the Netherlands can refrigerate to a level below zero degrees Centigrade, and those going to Northern Europe can heat up from below minus thirty degrees. Units going to Israel, where the power supply is often interrupted by warfare, restart automatically. The Yuetu brand accounts for 18 percent of all air-conditioners sold in Greece. So far the company has set up distribution networks in over forty countries around the world. Xie Tielan, Yuetu president, says: "Diversification is our means of continuing to compete in the international market. We have taken the globalization road out of Wenzhou."

Weili is the leader among Wenzhou's numerous lighter manufacturers, exporting 98 percent of its output to more than 50 countries and regions. It makes lighters to order for other brands, as well as exporting its own Weili brand, which is established in countries such as the ROK and Canada. The company has set up two design centers outside of China, and is planning to found a branch in Portland that will engage in lighter manufacture, design and distribution. Tiger, another local lighter producer, has registered its Tiger trademark in over thirty countries, and set up agents and outlets in more than sixty countries all over the globe.

By completing global networks of design, manufacture, distribution and service, Wenzhou enterprises are forging their way through to ever more parts of the world.