Hard times for China’s micro-industrialists

THERE ARE lots of upsides to making bikes for kids, explains Mr Li, a young entrepreneur from Pingxiang, a scruffy county in northern China that has become a centre for the children’s bicycle industry. For one thing, they are easy to build, he says, nodding at a toddler-sized machine parked near his desk, held upright by tiny stabilisers. Teenage mountain bikes are a bit fiddly, but smaller ones “need no special machinery at all”. Also, he grins, children grow. Sell a three-year-old their first ride and two years later their parents have to buy a bigger one, and so it goes on for years to come. The downside? China is running out of children.Pingxiang, in the province of Hebei some 400km south of Beijing, is a revealing place to see the country’s demographic future playing out today. Like many industrial clusters in China, it grew over decades as businesspeople forged networks, helped by local officials offering tax breaks and other subsidies. Initially, small firms assembled frames, pedals and other parts bought from established manufacturers in coastal cities. Over time complete supply chains were created in Pingxiang. Today, the county is a sprawl of large industrial plants linked to smaller suppliers, many of them tucked away in rural sheds and barns. There are traffic jams as lorries and three-wheelers piled high with bicycle cartons inch down narrow village lanes.