Made in China 2025

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Made in China 2025 (Chinese: 中国制造2025; pinyin: Zhōngguó zhìzào èrlíng'èrwǔ)[1] is a strategic plan of China issued by Chinese Premier Li Keqiang and his cabinet in May 2015.[2] With it, China aims to move away from being the world's "factory" (producing cheap, low quality goods due to lower labour costs) and move to producing higher value products and services.[3] It is in essence a blueprint to upgrade the manufacturing capabilities of Chinese industries.[4]

Goals[edit]

The goals of Made in China 2025 include increasing the Chinese-domestic content of core materials to 40 percent by 2020 and 70 percent by 2025.[5] The plan focuses on high-tech fields including the pharmaceutical industry, automotive industry, aerospace industry, semiconductors, IT and robotics etc, which are presently the purview of foreign companies.[6]

Reception[edit]

The Center for Strategic and International Studies describes it as an "initiative to comprehensively upgrade Chinese industry" directly inspired by the German Industry 4.0.[1] It is an attempt to move the country's manufacturing up the value chain[7] and become a major manufacturing power in direct competition with the United States.[8][9] The Chinese government is committed to roughly investing $300 billion US dollars to achieve this plan.[3]

Background[edit]

China is facing a multitude of internal issues such as slower economic growth, higher wages, increased costs of an aging population, a shrinking workforce, wealth inequality, an underdeveloped social welfare system,[10] and environmental degradation.[11] It is also competing in the manufacturing space from newly emerging economies like Vietnam and highly industrialized countries.[3][11] In order to maintain economic growth, standards of living, and meeting the demand of its increasingly educated workforce, it needs to lift the game on its economic and technological competitiveness.[11] Alan Wheatley from British Think Tank Chatham House indicated a broad and growing middle class is necessary for economic and political stability.[12]

Key industries[edit]

The plan lists 10 key industries on which Chinese government focused to become a world leader.[13]

Key Industries of the Made in China 2025
Industry sector Description
Information Technology AI, IoT, smart appliances
Robotics AI, machine learning
Green energy and green vehicles energy efficiency, electric vehicles
Aerospace equipment
Ocean engineering and high tech ships
Railway equipment
Power equipment
New materials
Medicine and medical devices
Agriculture machinery

Premier Li has indicated advanced standards in industries are absolutely essential to foster innovation and eliminate bottlenecks in industrial development.[14] China has a growing middle class who are demanding higher quality goods and services.[14] Compared with overseas competition, the quality and innovation of Chinese goods have not caught up.[14] Premier Li talks about the quality revolution.[14] This revolves around entrepreneurship and craftsmanship.[14] It will involve embracing a culture of continuous innovations and refinement in quality of goods produced.[14]

Reactions[edit]

The United States think tank Council on Foreign Relations stated in 2018 that it is a "real existential threat to U.S. technological leadership".[15] The Li Keqiang Government maintains that the plan is in line with the country's World Trade Organization obligations.[16] On 15 June 2018, the Trump administration imposed higher tariffs on Chinese goods, escalating the trade tensions between China and the U.S. The tariff list mainly focuses on products included in the Made In China 2025 plan, including IT and robotics related products.[17]

It has been suggested that some aspects of the policy may violate World Trade Organization rules, such as the self-sufficiency quotas for several high-tech components.[3]

See also[edit]

Literature[edit]

  • Boris Lee (2019). Assessing Made in China 2025: The US - China Trade War and Ways Going Forward. Claremont Colleges Library.
  • Edward Alden, Nicholas Burns, Ash Carter, Jack Clark (2019). Technology and National Security: Maintaining America's Edge. The Aspen Institute. ISBN 978-0578427959.CS1 maint: Multiple names: authors list (link)

References[edit]

  1. ^ a b Made in China 2025. CSIS, June 1, 2015.
  2. ^ “Made in China 2025” plan unveiled to boost manufacturing. China News Service, May 2015.
  3. ^ a b c d Fang, Jason; Walsh, Michael (2018-04-29). "What is Made in China 2025 and why is the world concerned about it?". ABC News. Retrieved 2019-01-10.
  4. ^ "China to invest big in 'Made in China 2025' strategy". english.gov.cn. Retrieved 2019-01-10.
  5. ^ Foreign Firms Wary Of 'Made In China 2025,' But It May Be China's Best Chance At Innovation forbes.com Sara Hsu, March 10, 2017.
  6. ^ China Prepares for Big Pharma. Zachary Torrey, thediplomat.com, March 2018.
  7. ^ Made In China 2025: A New Era For Chinese Manufacturing CKGSB, September 2, 2015
  8. ^ "What is 'Made in China 2025' — and why is it a threat to Trump's trade goals?".
  9. ^ "YouTube". www.youtube.com. Retrieved 12 May 2019.
  10. ^ "The question mark hanging over China's middle class". South China Morning Post. 2018-10-12. Retrieved 2019-01-10.
  11. ^ a b c "Made in China 2025 and US–China power competition". www.lowyinstitute.org. Retrieved 2019-01-10.
  12. ^ "The question mark hanging over China's middle class". South China Morning Post. 2018-10-12. Retrieved 2019-01-10.
  13. ^ China, McKinsey (2015-05-27). "China Is Betting Big on These 10 Industries". McKinsey Greater China. Retrieved 2019-01-10.
  14. ^ a b c d e f "Quality revolution needed for 'Made in China'". english.gov.cn. Retrieved 2019-01-11.
  15. ^ Why Does Everyone Hate Made in China 2025? CFR, March 28, 2018
  16. ^ China says "Made in China 2025" in line with WTO rules Xinhua, 2018-04-04, Zhou Xin
  17. ^ U.S. and China Expand Trade War as Beijing Matches Trump’s Tariffs NY Times, 15 June 2018

External links[edit]