Society

Even Made-In-China Toilet Seats Are The Butt Of Jokes

Chinese consumers still don't trust goods made in their own country. The latest buy-abroad craze? Japanese toilet seats. Why the country must pull up its pants and stand proud.

Crap translation
Han Yuting

BEIJING — Chinese finance writer Wu Xiaobo recently posted on a social media account, "Go to Japan to buy toilet seats."

Apparently, he'd gotten a taste of these fancy electric bathroom accessories available in Japan, which can cost upward of $300 and offer automatic disinfection, bidet services, warmers, perfumes and "masking noises."

The post generated a lot of attention, and it wasn't long before the leading China bathroom brand Jomoo invited Chinese media representatives to visit its factories so it could, well, pooh-pooh the notion that its toilet seats were below par. Even Premier Li Keqiang mentioned the topic, saying he believes in "being open-minded and opposes trade barriers so that consumers can have more choice." But, he said, Chinese enterprises should upgrade themselves to be more competitive.

As one market researcher says, these so-called smart toilets have a penetration rate of over 95% in Japan, whereas fewer than 3% of the Chinese population have ever used one. This obviously indicates huge room for growth.

That Chinese tourists travel as far as Japan to buy and bring back rice cookers, toilet seats and other commodities is no longer really news. So why has "the toilet seat issue" become such a big deal? Probably because it exposes deep-seated consumer anxiety about goods being "made in China."

Jomoo toilet seat, made in China — Photo: Official Facebook page

It's well known that affluent Chinese classes would rather travel to America, Europe, Japan or Hong Kong to buy goods than pay a lesser price at home for items made in China. In fact, a government agency estimated that about 450,000 Chinese tourists visited neighboring Japan during the recent Chinese New Year, spending as much as $960 million.

There are several reasons why Chinese tourists go far to buy basic wares. First, there is a certain difference in quality between Chinese goods and foreign brands, even though the difference is exaggerated. Second, there is simply a grass-is-greener notion among Chinese consumers, wherein they believe goods made abroad are better than what they can buy at home.

Take the toilet seat as an example. As many know, Chinese hotels with three or more stars don't equip their bathrooms with domestic brand toilets. It has become an entrenched industry practice, and consumers have taken note.

A huge systematic project

A country's manufacturing industry is built on a chain of links — value system communication, industrial standards, corporate branding, and of course its citizens. No matter which link goes wrong, it will be reflected in product quality.

Though the Chinese tendency to buy toilet seats from Japan is a funny example, we must acknowledge that the embarrassment of being "made in China" goes far beyond this particular kind of merchandise.

If Chinese-made goods are to be competitive in the market, China's national image must undergo a top-down revolution.

As Bao Xinhe, a member of the National People's Congress and the Chinese Academy of Sciences, put it, we have to promote "made in China" as "made with Chinese intelligence," from top scientific and research institutes to small and micro enterprises.

Obviously, China is perfectly capable of perfecting a basic toilet seat technology. The crux of the problem is that Chinese research institutions look down on investing effort into "small innovations," preferring instead to put all their energy into the grand national scientific propositions.

Meanwhile, small companies fall short in investment capability. This explains why Chinese-made goods have been trapped by low growth where homogeneity, price wars, high costs and low efficiency have always been the shadowy keywords.

Pure technical and branding problems are not hard to solve, but they are a question of time. It's probably not up to any individual company or industry to change Chinese consumers' stereotyped impression of Chinese-made goods. Only when the whole nation acknowledges and acts with institutional changes and a new brand strategy can fundamental improvement be made.

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Economy

Merkel's Legacy: The Rise And Stall Of The German Economy

How have 16 years of Chancellor Angela Merkel changed Germany? The Chancellor accompanied the country's rise to near economic superpower status — and then progress stalled. On technology and beyond, Germany needs real reforms under Merkel's successor.

Chancellor Angela Merkel looks at the presentation of the current 2 Euro commemorative coin ''Brandenburg''

Daniel Eckert

BERLIN — Germans are doing better than ever. By many standards, the economy broke records during the reign of outgoing Chancellor Angela Merkel: private households' financial assets have climbed to a peak; the number of jobs recorded a historic high before the pandemic hit at the beginning of 2020; the GDP — the sum of all goods and services produced in a period — also reached an all-time high.

And still, while the economic balance sheet of Merkel's 16 years is outstanding if taken at face value, on closer inspection one thing catches the eye: against the backdrop of globalization, Europe's largest economy no longer has the clout it had at the beginning of the century. Germany has fallen behind in key sectors that will shape the future of the world, and even the competitiveness of its manufacturing industries shows unmistakable signs of fatigue.

In 2004, a year before Merkel was first elected Chancellor, the British magazine The Economist branded Germany the "sick man of Europe." Ironically, the previous government, a coalition of center-left and green parties, had already laid the foundations for recovery with some reforms. Facing the threat of high unemployment, unions had held back on wage demands.

"Up until the Covid-19 crisis, Germany had achieved strong economic growth with both high and low unemployment," says Michael Holstein, chief economist at DZ Bank. However, it never made important decisions for its future.

Another economist, Jens Südekum of Heinrich Heine University in Düsseldorf, offers a different perspective: "Angela Merkel profited greatly from the preparatory work of her predecessor. This is particularly true regarding the extreme wage restraint practiced in Germany in the early 2000s."

Above all, Germany was helped in the first half of the Merkel era by global economic upheaval. Between the turn of the millennium and the 2011-2012 debt crisis, emerging countries, led by China, experienced unprecedented growth. With many German companies specializing in manufacturing industrial machines and systems, the rise of rapidly industrializing countries was a boon for the country's economy.

Germany dismissed Google as an over-hyped tech company.

Digital competitiveness, on the other hand, was not a big problem in 2005 when Merkel became chancellor. Google went public the year before, but was dismissed as an over-hyped tech company in Germany. Apple's iPhone was not due to hit the market until 2007, then quickly achieved cult status and ushered in a new phase of the global economy.

Germany struggled with the digital economy, partly because of the slow expansion of internet infrastructure in the country. Regulation, lengthy start-up processes and in some cases high taxation contributed to how the former economic wonderland became marginalized in some of the most innovative sectors of the 21st century.

Volkswagen's press plant in Zwickau, Germany — Photo: Jan Woitas/dpa/ZUMA

"When it comes to digitization today, Germany has a lot of catching up to do with the relevant infrastructure, such as the expansion of fiber optics, but also with digital administration," says Stefan Kooths, Director of the Economic and Growth Research Center at the Kiel Institute for the World Economy (IfW Kiel).

For a long time now, the country has made no adjustments to its pension system to ward off the imminent demographic problems caused by an increasingly aging population. "The social security system is not future-proof," says Kooths. The most recent changes have come at the expense of future generations and taxpayers, the economist says.

Low euro exchange rates favored German exports

Nevertheless, things seemed to go well for the German economy at the start of the Merkel era. In part, this can be explained by the economic downturn caused by the euro debt crisis of 2011-2012. Unlike in the previous decade, the low euro exchange rate favored German exports and made money flow into German coffers. And since then-European Central Bank president Mario Draghi's decision to save the euro "whatever it takes" in 2012, this money has become cheaper and cheaper.

In the long run, these factors inflated the prices of real estate and other sectors but failed to contribute to the future viability of the country. "With the financial crisis and the national debt crisis that followed, economic policy got into crisis mode, and it never emerged from it again," says DZ chief economist Holstein. Policy, he explains, was geared towards countering crises and maintaining the status quo. "The goal of remaining competitive fell to the background, as did issues concerning the future."

In the traditional field of manufacturing, the situation deteriorated significantly. The Institut der Deutschen Wirtschaft (IW), which regularly measures and compares the competitiveness of industries in different countries, recently concluded that German companies have lost many of the advantages they had gained. The high level of productivity, which used to be one of the country's strengths, faltered in the years before the pandemic.

Kooths, of IfW Kiel, points out that private investment in the German economy has declined in recent years, while the "government quota" in the economy, which describes the amount of government expenditure against the GDP, grew significantly during Merkel's tenure, from 43.5% in 2005 to 46.5% in 2019. Kooths concludes that: "Overall, the state's influence on economic activity has increased significantly."

Another very crucial aspect of competitiveness, at least from the point of view of skilled workers and companies, has been neglected by German politics for years: taxes and social contributions. The country has among the highest taxes on income in Europe, and corporate taxes are also hardly as high as in Germany anywhere in the industrialized world. "In the long run, high tax rates always come at the expense of economic dynamism and can even prevent new companies from being set up," warns Kooths.

Startups can renew an economy and lay the foundation for future prosperity. Between the year 2000 and the Covid-19 crisis, fewer and fewer new companies were created every year. Economists from left to right are unanimous: Angela Merkel is leaving behind a country with considerable need for reform.

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