If China’s manufacturing becomes stronger, will it stop importing from abroad?

　　Some foreign media have expressed concern that “Made in China 2025” aims to replace foreign technology with Chinese technology in high-end industries, substitute Chinese manufacturing for foreign manufacturing, and enhance the global competitiveness of China’s high-tech enterprises.

　　Why is it important to develop our own core technologies in high-end industries? Is the real goal really to replace foreign technologies? To address these questions, the reporter interviewed government officials and industry experts.

　　It's impossible to replace all foreign-made products.

　　“Some foreign media believe that ‘Made in China 2025’ is all about replacing imports—a view that reflects misinterpretation and misunderstanding,” said Li Beiguang, Deputy Director of the Planning Department of the Ministry of Industry and Information Technology, in an interview with a reporter from the Economic Daily. “China remains a developing country with enormous demand for advanced technologies and products. The formulation and implementation of ‘Made in China 2025’ are aimed at accelerating the transformation and upgrading of China’s industrial sector. Promoting independent innovation and developing high-end manufacturing are also essential to meeting the needs of China’s economic development, improving people’s livelihoods, and safeguarding national security.”

　　Responding to foreign media reports that “Chinese technology is set to replace foreign technology,” Xu Zhaoyuan, a researcher at the Department of Industrial Economy Research of the Development Research Center of the State Council, analyzed that the “Made in China 2025” initiative primarily emphasizes the development of high-end manufacturing. Given that this strategic goal is aligned with that of developed countries—such as the U.S., Japan, and Germany—which are characterized by high value-added and high-end industries, some foreign media have claimed that China aims to supplant foreign manufacturers in the high-end sector.

　　“Some foreign media are being overly concerned,” said Xu Zhaoyuan. “No country can ever monopolize or completely replace all high-tech industries.” Drawing on the experiences of the world’s major developed nations, he noted that countries that have developed more recently generally follow a path of industrial upgrading and steadily increasing the share of high-end industries. Throughout this process, however, there has been no significant impact on the global manufacturing landscape. For instance, during their periods of catching up and rising in manufacturing, Japan, South Korea, and Germany did not fully replace U.S. manufacturing.

　　In other words, the implementation of “Made in China 2025” will undoubtedly spur further technological breakthroughs in certain industries and help China develop its own cutting-edge technologies. It will also introduce some competition into the high-end industries of other countries. However, each country has its own advantageous industries, and it is unlikely that any single country’s manufacturing sector will completely replace foreign-made products.

　　Since the beginning of this year, several international organizations—including Germany’s Mercator China Research Center, the China-EU Chamber of Commerce, and the American Chamber of Commerce—have successively released research reports on “Made in China 2025.” In response, Li Beiguang emphasized that the relevant development indicators mentioned in these reports—such as domestic market share in related industries—are all drawn from research reports prepared by the Strategic Advisory Committee for Manufacturing Powerhouse Development. These indicators are predictive in nature and primarily serve as guiding references. Moreover, the Strategic Advisory Committee is a research and advisory body composed of experts, scholars, and senior corporate executives. When releasing the roadmap, the Committee explicitly stated that the aforementioned indicators are predictive and carry no binding force; they do not represent government actions either.

　　Will not lead to unfairness

　　After the release of “Made in China 2025,” some have argued that China will step up its investment in domestic enterprises, thereby creating an unfair advantage for domestic firms over foreign-invested enterprises. In response, Li Beiguang candidly admitted that, since the implementation of “Made in China 2025” more than two years ago, China has consistently applied the same standards to both domestic and foreign-invested enterprises, treating them equally. In January 2017, the State Council issued a notice stating that foreign-invested enterprises and domestic-invested enterprises would be subject to the same strategic policy measures under “Made in China 2025.”

　　For example, in establishing manufacturing innovation centers, the National Power Battery Innovation Center has jointly set up a joint laboratory with the University of Western Ontario in Canada, and the National Additive Manufacturing Innovation Alliance already has three overseas member organizations. In the field of intelligent manufacturing, the “Pilot Demonstration Project for Intelligent Shipbuilding Workshops” undertaken by Nantong COSCO Kawasaki Ship Engineering Co., Ltd. has been designated as a pilot demonstration project for intelligent manufacturing.

　　Li Beiguang added that the C919 serves as a prime example of cooperation between Chinese and foreign enterprises. Its engines, avionics, and flight control systems are supplied by numerous joint ventures and wholly-owned subsidiaries from Europe and the U.S., with suppliers including American companies such as General Electric and Honeywell. Among the Tier-1 suppliers alone, there are more than ten international firms, while the number of Tier-2 and Tier-3 suppliers reaches into the hundreds.

　　“The view that ‘only supporting domestic enterprises puts pressure on foreign-invested enterprises’ is based on misinterpretations, misunderstandings, as well as subjective assumptions and deliberate distortions,” analyzed Qiao Biao, Director of the Planning Research Institute at CCID Consulting. On the surface, this appears to be a concern about China’s manufacturing development strategy; in reality, however, it is an attempt to leverage international discourse hegemony to exert pressure on China’s manufacturing sector—indeed, even to stir up discontent among foreign-invested enterprises and reduce the attractiveness of China’s manufacturing development environment. Further analysis reveals that the skepticism expressed by European and American countries toward ‘Made in China 2025’ stems primarily from their fear that the rise of China’s high-end manufacturing will erode their share of the global market.

　　It should be noted that many high-tech technologies and related products from developed countries are currently subject to strict restrictions and export embargoes imposed on China. “The fact that our core technologies are dependent on others is precisely the crux of why China’s manufacturing sector, though large in scale, remains weak,” says Qiao Biao. Without addressing this critical issue, not only will the upgrading and transformation of traditional industries remain mere empty rhetoric, but the development of strategic emerging industries will also lack a solid foundation. The “Made in China 2025” initiative was launched precisely with the aim of relying on independent innovation to overcome our developmental shortcomings and meet the ever-escalating demands of the domestic market for high-quality products.

　　It will bring tremendous business opportunities to both domestic and international markets.

　　Qiao Biao frankly admitted that it is entirely understandable for any country to strive to improve the quality and standards of its equipment. However, in the context of globalization, trying to enhance the quality and standards of one’s equipment behind closed doors is tantamount to building a car in isolation—and such an approach simply cannot achieve the desired results.

　　“Our country is actively promoting ‘Made in China 2025,’ which offers vast market opportunities and promising prospects for cooperation to businesses from all countries,” Li Beiguang said. Since the launch of “Made in China 2025,” China has engaged in active exchanges and cooperation with several countries. For example, a cooperative mechanism has been established between “Made in China 2025” and Germany’s “Industry 4.0,” yielding positive results.

　　However, due to factors such as costs, the developed countries in Europe and the U.S. still primarily focus on and maintain their competitive edge in high-end manufacturing. For China, transitioning its manufacturing sector from the mid-to-low end to the mid-to-high end will still take time. Li Beiguang revealed that, for the foreseeable future, China will continue to maintain a complementary relationship with manufacturing powerhouses like the U.S. and Japan. The globally established pattern of industrial division of labor and competitive dynamics will hardly undergo disruptive changes in the short term.

　　It is certain that as China’s market continues to elevate its standards in pursuit of product quality and equipment upgrades, it will inevitably contribute to the expansion of the global market. Qiao Biao analyzed that, on the one hand, the implementation of “Made in China 2025” will bring enormous market opportunities to both domestic and foreign enterprises. To enhance the quality of their products, Chinese companies must raise their process and equipment standards. In this upgrading process, cooperation with developed countries will become essential, and more foreign equipment, products, and technologies will enter the Chinese market.

　　On the other hand, with the implementation of “Made in China 2025,” more Chinese and foreign enterprises will strengthen their cooperation in the field of equipment technology. China is the world’s largest consumer market and also the largest market for the application of advanced technologies. For foreign equipment to enter the Chinese market, it must be adapted locally. For example, General Motors of the United States now holds a 17% market share in China; it has continuously expanded its market share precisely by adapting its products to China’s road conditions, climate, and other local factors.

　　Li Beiguang stated that the launch and implementation of “Made in China 2025” are by no means about “refusing to buy foreign products” or “replacing foreign-made goods.” On the contrary, as China advances “Made in China 2025,” it will consistently uphold the principles of open development and win-win cooperation, actively engaging in collaboration with more foreign enterprises and creating a favorable environment for pragmatic cooperation among businesses. (Reporter: Ji Leilei)