Upgrading moving ahead, despite obstacles
The Made in China 2025 initiative has made fresh progress in the first quarter, even though the upgrading of China's manufacturing industry faces obstacles caused by policy shifts in major developed economies, a spokesperson for the Ministry of Industry and Information Technology (MIIT) said on Wednesday.
The work on national demonstration zones is progressing and the country has seen speedy development in integrated circuits, industrial robots, new-energy vehicles, and new materials, said Chen Yin, the MIIT spokesperson.
The ministry has helped in nurturing State-level innovative manufacturing centers, and five such centers - devoted to batteries, additive manufacturing, information optoelectronics, printing and flexible displays, and robotics - have been established so far, according to Chen.
"Plus about 60 such centers at the provincial level across the country have started to take shape," Chen said.
However, Chen also noted that the process of upgrading and transferring toward high-quality growth is facing a number of obstacles given the shift in economic policy in some major developed countries and the rising friction in global trade.
Zhang Yue, an analyst with market research firm IDC, said China has seen new progress in industrial internet in the first quarter.
The concept of industrial internet was first coined by U.S. conglomerate GE, but after several years of preparation, Chinese firms such as Sany Heavy Industry Co are maturing in this regard, Zhang said.
"From now to 2020, China is expected to see a number of manufacturing enterprises maturing in grasping the power of the internet, and some heavy machinery or high-value equipment makers will see their business models transform from selling equipment to selling data-based services such as predictive maintenance and financial services," Zhang told the Global Times on Wednesday.
Rajiv Biswas, Asia-Pacific chief economist for IHS Markit, said the Made in China 2025 initiative has been very successful to date, generating rapid growth in output for new technology sectors and helping China to become the world leader in manufacturing of new-energy vehicles (NEVs).
"Chinese multinationals are already among the global leaders in developing new electric batteries, including Chinese firms BYD Co and CATL," Biswas said in an email sent to the Global Times on Wednesday.
The eased restrictions on foreign NEVs' investment "will help to create an innovative, competitive market for the rapid development of NEV technology and to create a leading hub for the development of battery technology," Biswas noted.
Chen from the MIIT also said there is still a gap between Chinese and foreign firms in terms of the design and production of chips. The comment came as the U.S. decision to suspend the supply of chips to Chinese telecommunications equipment maker ZTE threatens the company's operation and survival.
Zhang said the U.S. might be alarmed by China's rapid technological breakthroughs such as the C919 airliner, and the ZTE incident underlines the importance of developing homegrown core technology.
However, moves by developed countries to levy high tariffs on key intermediary imports from China might yet prove to be a boon for Chinese manufacturers, Zhang said.
"Suppose a tariff caused the costs for Chinese manufacturers to rise sharply - the Chinese firms would have to seek ways to drastically reduce costs, probably either by employing more automation with industrial robots or by boosting R&D on key parts," Zhang said.