In the new wave of industrial transfer, china is undergoing a profound reshaping of its economic geography.

On September 25, a heavyweight document released at the national level proposed a strategic deployment of "guiding funds, technology, and labor-intensive industries to shift orderly from the eastern region to the central and western regions, and from central cities to the hinterland. This decision has not only triggered widespread market attention, but also pointed out new investment directions for investors.

What is the logic behind this? For ordinary investors, based on this background of large-scale Industry transfer, how can opportunities be captured?

I. Industry transfer achieves balanced development.

Behind the national drive for industrial relocation is the resolution of the long-standing issue of regional development imbalances in China.

Leveraging geographical and policy advantages, the development speed of the eastern coastal areas far exceeds that of the western regions. According to statistics, by 2023, the eastern coastal cities, with only around 9% of the land area, accommodated nearly 40% of the country's population, contributed over half of the GDP, and about 80% of the total import and export volume.

Through Industry transfer, not only can the environmental pressure and land resource tension in the eastern regions be alleviated, but it can also promote economic development in the central and western regions, achieving balanced growth nationwide.

Furthermore, cities in the central and western regions have mature industry supporting facilities, which provides the possibility to undertake the overflow of production capacity from the eastern coastal areas. For example, cities like Chengdu and Chongqing have already formed relatively complete industry chains in fields such as electronics and equipment manufacturing, providing a good industrial foundation and supporting services for the industrial transfer from the eastern coastal areas.

At the same time, as the uncertainty and risk in the external environment increase, enterprises themselves also have the motivation to restructure and seek regional layouts with higher cost efficiency. The central and western cities have abundant land resources, lower land costs, and rich and inexpensive labor, providing ample space for enterprise development.

In this wave of industrial transfer, Sichuan undoubtedly occupies a strategic location and has acted early. The Sichuan provincial government has issued the 'List of Key Projects for Accelerating Preliminary Work in Sichuan Province in 2024', planning to start 330 major projects with an estimated total investment of 2.15 trillion yuan in the next 2 to 3 years. These projects mainly involve transportation, Energy, Water Conservancy, and other fields, indicating that trillion-level incremental Infrastructure projects will bring new development opportunities to the relevant Industry Chain.

The advancement of infrastructure projects will directly drive the development of upstream and downstream industries. From building materials to construction equipment, from energy supply to information technology, every link will benefit from this round of infrastructure boom.

Especially for the plastics pipe industry, with the acceleration of urbanization and the promotion of infrastructure construction, the demand for efficient and eco-friendly pipeline systems will continue to grow.

II. 'Specialized, Refined, Strong' builds core competitiveness.

As the industrial transfer deepens, the demand for plastic pipe products will demonstrate characteristics of diversification and high quality. This also means that downstream industries have increasingly high requirements for the supply of plastic pipe products, needing to provide a variety of products and high-quality solutions in each field.

To achieve this, strong R&D capabilities are essential support. China Lesso, as a leading enterprise in the pipe industry, has long focused on R&D investment and currently has 17 national, provincial and ministerial-level innovation R&D platforms, with nearly 3000 patents and over 10,000 products.

As mentioned above, transportation, energy, water conservancy, and other aspects are the three major industries that benefit the most from this wave of industrial transfer, coincidentally also the strengths of China Lesso.

In terms of water conservancy, China Lesso not only participates in the construction of underground pipe networks in large cities, but also in national-level projects such as the rainwater engineering in the Xisha and Nansha Islands, the construction of Chengmai Hainan Ecological Smart New City, flood prevention and control in Xiong'an New Area, and the Guangxi Datengxia Water Conservancy Hub Irrigation District.

Frequent involvement in major water conservancy projects would not be possible without China Lesso's deep understanding of the realities of water conservancy projects. Against the backdrop of increasingly serious water pollution issues, enhancing the safe operation of water conservancy projects is a common challenge faced by the industry. Moreover, China is threatened by flood disasters year-round, so improving flood control capabilities is also a problem that water conservancy projects need to address.

By providing high-performance pipeline products like non-toxic and scale-resistant PE water pipes, which are chemically corrosion-resistant with no electrochemical reactions, effectively preventing secondary pollution and protecting water quality, while also having good impact resistance, China Lesso contributes to enhancing the overall flood control capabilities of projects.

In terms of transportation, China Lesso has been deeply involved in major projects such as the Hong Kong-Zhuhai-Macao Bridge and the Shen-Zhong Passage.

Such cross-sea projects face challenging climatic conditions like strong winds, high temperatures, high humidity, and high salt content, posing high demands on the comprehensive performance of pipeline materials across the transportation sector. As a designated supplier, the high-quality PVC, HDPE, and other pipes provided by China Lesso have excellent corrosion resistance, strong pressure resistance, and anti-aging properties, enabling long-term stable operation in various complex and harsh environments.

In the energy sector, China Lesso has also shown remarkable performance, especially in the field of pipeline transportation.

It is well-known that pipeline transportation plays a crucial role in the energy sector due to its high efficiency, safety, and low cost characteristics. However, pipeline transportation in different energy sectors has its own unique challenges. For example, hydrogen pipelines often suffer from hydrogen embrittlement and corrosion, which can accelerate pipeline aging, increase maintenance costs, and even lead to safety incidents. China Lesso has introduced RTP flexible composite hydrogen transport pipes, overcoming the issues of hydrogen embrittlement and corrosion in traditional pipelines, providing a new technical solution for China's 'West Hydrogen to East' project.

Frequent appearances in heavyweight projects to some extent indicate that China Lesso's product strength has been officially recognized, which helps to enhance its brand influence and market acceptance. At the same time, high-level projects will compel China Lesso to continuously innovate technically and in product development to cope with more challenging tasks, thereby forming a virtuous cycle that rapidly upgrades its product strength, making it easier to gain favor from relevant project parties in the subsequent relocation and construction of industries.

At the same time, the rich project management and execution experience accumulated in such major projects is scarce. This experience enables China Lesso to quickly adapt to various complex environments, accurately grasp policy trends and market opportunities, effectively coordinate resources, and ensure project quality and progress.

To better grasp the incremental opportunities brought by the industrial transfer wave, good products alone are not enough. The closer the product is to the end-user, the more it can meet the needs for low-cost, long-distance transportation, as plastic pipes themselves have a certain transportation radius.

CHINA LESSO's extensive production network across the country has brought significant supply chain advantages. Relying on production bases in 19 provinces nationwide, CHINA LESSO has achieved deep coverage of the vast Chinese market. At the same time, CHINA LESSO has established long-term strategic partnerships with 2,891 first-tier Dealers, and this massive sales network not only strengthens the company's connection with the market but also improves product delivery efficiency and responsiveness to market changes.

Three, Conclusion.

Under the guidance of national strategy, industrial transfer is not only a geographical re-layout but also an important step in optimizing and upgrading China's economic structure, leading to new opportunities in the plastics pipe industry.

Through continuous technological innovation and product upgrades, China Lesso has met the market demand for high-performance, eco-friendly, and intelligent products, not only gaining a development advantage for itself but also making positive contributions to enhancing the quality of industrial development and promoting the balanced development of regional economies.