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Liu Huchen: Strengthening the Foundation of Manufacturing Industry Chain Security

Thu, Jan 11, 2024

Recently, the 2023 World Manufacturing Convention, hosted by the Ministry of Industry and Information Technology, the Ministry of Science and Technology, the Ministry of Commerce and other organizations reviewed the past and looked into the future of the global manufacturing industry which is moving toward higher-end, smarter, and greener production. With a long value chain, strong correlations and a large driving force, the manufacturing industry plays a leading and supporting role in the modern economic system. Strengthening the foundation of manufacturing industry chain security is of far-reaching significance for optimizing and strengthening manufacturing, driving manufacturing toward the top of the value chain and boosting China’s strength in product quality.

The manufacturing industry is a pillar of the national economy and serves as a nation’s backbone, a means of revitalization and a base for building a strong country. After decades of development, China’s manufacturing value-added contributes nearly 30% of the global total, and its scale has maintained the world’s top position for 13 consecutive years. With continuous growth in industry scale, continuous optimization of industry structure, and continuous improvement of resilience and security of industrial and supply chains, China’s manufacturing industry has made innovative breakthroughs in key areas, kept raising its position in the global value chain and increased overall strength, innovation and competitiveness. Currently, with the evolution of the global landscape accelerating, the forces of unilateralism, protectionism and opposition to globalization on the rise, and the globalization-related issues exacerbated, countries’ contest for the leadership of industrial and supply chains becomes increasingly fierce. The development of China’s manufacturing industry is in a critical period of restructuring and quality and efficiency improvement and is also entering a key stage of transitioning from scale expansion to strength enhancement and surmounting difficulties and obstacles.

The study of the development of China’s manufacturing industry should focus on problems and goals. China’s manufacturing industry is “large but not strong, complete but not refined, diverse but not sophisticated”, with prominent problems such as a low level of industrial system modernization, weak industrial foundations, and bottlenecks in key links of the industrial chain as well as problems such as weak sci-tech innovation capabilities and insufficient industrial chain stability and impact resistance. In the future, China must take multiple measures to activate the development momentum of the manufacturing industry by starting from breakthroughs in technologies, cluster development and ecosystem building.

China should focus on the weak links of the manufacturing industry chain and strengthen breakthroughs in core technologies in key fields. This requires targeting the current weak links in the industrial chain that impede the transformation and upgrading and high-quality development of China’s manufacturing industry, taking full advantage of China’s super-large market and new system for mobilizing resources nationwide, mobilizing sci-tech, industrial and financial forces and concentrating quality resources to overcome difficulties together. It also requires pinpointing weak links in core technologies in key fields and components for key areas such as major technical equipment R&D and manufacturing and industrial chain building, establishing a sound industrial innovation system, improving the industrial innovation network, strengthening basic research, applied research and breakthroughs in core technologies in key fields, focusing on independent innovation, which holds the key to development, and ensuring that the manufacturing industrial system is independent, controllable, safe and reliable.

China should stimulate leading enterprises’ leadership and enhance the competitiveness of manufacturing industry clusters. Enterprises are the cornerstone of high-quality industrial development and industrial competitiveness largely depends on the strength of leading enterprises. Therefore, it is vital to focus on fostering a group of industry-leading enterprises with advanced international levels and strong control over the industrial chain, strengthen chain thinking, bring into full play the leading role of leading enterprises and drive upstream and downstream enterprises to conduct division of labor and cooperation and connect and integrate; it is important to focus on advanced manufacturing, concentrate efforts, gather resources, integrate factors, continuously improve the upstream and downstream layout of the industrial chain, strive to supplement, reinforce and extend the chain, improve the resilience of the industrial and supply chains, accelerate the building of a group of internationally competitive advanced manufacturing industry clusters, unleash the industrial cluster effect, enhance the competitiveness of industrial cluster development and build new momentum for boosting China’s strength in manufacturing.

China should also optimize the development environment of the manufacturing industry and build a favorable development ecosystem. A favorable environment is a “booster” to industrial development. Therefore, it is crucial to create a market-oriented, law-based, world-class business environment, build a unified national market, strengthen policy coordination and business interaction, improve industrial chain supporting facilities, keep financing channels unimpeded, channel financial resources into micro, small and medium-sized enterprises on the manufacturing industry chain and contribute to the stable and smooth circulation of industrial and supply chains; it is important to build an open, inclusive, diverse, collaborative and orderly innovation ecosystem, build a manufacturing mission community of co-creation, co-building, sharing and win-win results, accelerate the deep integration of the industrial chain and the innovation chain, stimulate the innovation vitality of manufacturing enterprises, focus on creating a favorable ecosystem for industrial development and lay a solid foundation for improving the modernization of the manufacturing industry chain.

Original article published in Economic Daily on September 29, 2023

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