May 18, 2024

Deeply Cultivating High-end Manufacturing Industry Chain to Improve National Competitive Advantage

Whether China can deepen the high-end industrial chain based on the traditional advantages of the consolidation of manufacturing industry is the core link of whether the super-emerging economies can move toward a true industrial and financial power, and will also directly determine the first half of the 21st century. The actual status in the global economic division of labor. The competition between the future manufacturing industry and the development model is mainly the competition of independent innovation ability, and ultimately the competition of talents. It is our short board to cultivate a large number of senior skilled workers and increase the degree of focus on the commercial development of the entire society. Reversing this situation requires time and requires perseverance.

Deloitte's Global Consumer and Industrial Products Industry and the US Competitiveness Commission jointly released the 2016 Global Manufacturing Competitiveness Index. According to a survey of more than 500 global CEOs and executives in the manufacturing industry, 40 countries are currently present. In the ranking of future manufacturing competitiveness, China’s global manufacturing competitiveness ranks first in 2016, but the United States is expected to become the world’s most competitive manufacturing country in the next five years. Although the authoritativeness of this study and the accuracy of its related data may not be so reliable, its reference value should not be underestimated.

This report confirms the current competitive advantages of China's manufacturing industry, and affirms that China is making great efforts to promote the "Made in China 2025" and "Internet Plus" programs, and believes that these actions will enhance the status of Chinese manufacturing in the global value chain. At the same time, this report closely follows the United States’ efforts to reshape the manufacturing competitiveness. As the leader of the manufacturing industry with the most insightful market competition, the interviewed entrepreneurs' relevant advanced manufacturing technologies will be the key to unleashing the future competitiveness, which is also the consensus of Chinese entrepreneurs. As for the predictive analysis that has an important supporting role in the improvement of global competitiveness, the Internet of Things, industry 4.0 featuring intelligent products and smart factories, and advanced materials, etc., it is actually being translated into practical actions by Chinese companies.

Over the past 30 years, China’s manufacturing industry has achieved rapid progress and achieved remarkable results. The most prominent is that China's high-end manufacturing companies represented by Huawei are continuously upgrading their position in the global value chain. Huawei has not only surpassed the former idol Ericsson in certain aspects, but has even achieved certain competitive advantages over Apple in mobile phone manufacturing. It is no exaggeration to say today that the strategic value of Huawei in the Chinese economy far surpasses that of Internet companies represented by "BAT." It is only a relatively unrealistic reality: In China's manufacturing cluster, there are too few companies like Huawei to have a competitive advantage in the high-end industry chain, and Huawei itself is also facing international restrictions to improve global resource allocation from time to time. At the same time, we must not lose sight of the fact that China’s manufacturing industry has accumulated competitive advantages over the United States over the years and the cost has been rising year after year. The cost in some areas has even surpassed that of the United States. Although the government is vigorously creating a policy environment that is conducive to the development of the manufacturing industry, it must be turned into a conscious action by market players. Under the background of the “Internet Plus” in full swing, under the circumstances that industrial capital has entered the virtual economy in large numbers and that financial capital is continuously raising the valuation of the virtual economy, it will inevitably cause conceptual hype and the expansion of awareness of making quick money, which may lead to Distortion of manufacturing development path. Of course, China's major Internet giants have made great efforts to enter the manufacturing industry, which is indeed enriching the development and upgrading path of China's manufacturing industry. However, the penetration of Internet companies into the manufacturing sector is even highly intervening. It should abide by the general laws of the development of the manufacturing industry, that is, the core manufacturing technology as the primary reliance on the development of the manufacturing industry. This cannot be shaken.

Looking around the world, whether it is Germany's Industry 4.0 or the advanced manufacturing of the United States, its torso or recklessness is still a very strong industrial manufacturing system, and the Internet just plays the role of a tool. In this regard, do not put the cart before the horse. If we look back at the time spectrum for two centuries, almost all classic capitalist countries regard developing manufacturing as the top priority in strengthening national competitiveness. Even though Internet technology and thinking have permeated every capillary in the economic field today, the scale of manufacturing and overall modernization are still the most important indicators to measure a country’s overall strength.

Regarding the strategic level of competition between China and the United States, whether China can deepen its high-end industrial chain on the basis of consolidating the traditional advantages of manufacturing is whether China can move from a super-emerging economy to a true industrial and financial power. The core link will also directly determine China’s actual status in the global economic division of labor in the first half of the 21st century.

Although China’s economy has approached or even surpassed the United States in terms of a number of quantitative indicators, it still has a considerable gap with the United States in areas such as technology R&D, manufacturing, and financial competitiveness concerning national core competitiveness. Among these, the development of manufacturing based on R&D and industrialization is the most important support. Only on this basis can we expand the trade value chain and financial competitiveness to truly enhance our national competitive advantage. The real advantage of the United States lies in the unique service industry and the manufacturing industry that masters the core technology of high-end value chains. The competition between the future manufacturing industry and the development model is mainly the competition of independent innovation ability, and ultimately the competition of talents.

According to the “2016 Global Manufacturing Competitiveness Index” report, the CEO of the company interviewed confirmed that talent is the most important driver of manufacturing competitiveness. Cost competitiveness is the second most important driver of overall competitiveness, followed by productivity, supplier networks and laws and regulations. 73% of the executives surveyed believe that Germany is “very competitive” in terms of talent, with Japan (67%) and the United States (66%) being ranked second and third respectively. It is our short board to cultivate a large number of senior skilled workers and increase the degree of focus on the commercial development of the entire society. Reversing this situation requires time and requires perseverance.

Based on this, while increasing investment in human capital, we should lead the overall upgrading of the manufacturing structure with high-quality technological transformation, and forward-looking technical inputs promote the cultivation of high-end manufacturing. At this stage, some enterprises with relatively competitive advantages should improve their position and benefit in the global value chain through independent innovation. On the other hand, it will focus on the transformation of its economic strategy and increase investment in key technologies in the strategic industrial field, with a view to breaking through the core technological bottlenecks in key industries related to China’s future international division of labor status, and further optimize the industrial supporting environment in order to achieve a strategic transformation. China Forge made the overall competitive advantage of China's manufacturing industry.

At present, China needs to focus on making breakthroughs in key technologies that restrict the development of high-end manufacturing, such as core technologies, key technologies, key equipment, and component R&D. This urgently needs to address some important strategic industries and key high technologies with major application prospects. , to establish a national major innovation project, strengthen the construction of industrial common technical and scientific teams, form a combination of production, learning, and research, open-ended research, and adopt three-dimensional comprehensive measures in various aspects such as intellectual property protection, tax incentives, and R&D funding. In order to effectively stimulate various forms of independent innovation.

In terms of scientific research and factor input in the current development of China's manufacturing industry, although in some regions and some enterprises have indeed developed considerable dynamism, there are also problems that restrict further development. For example, after reaching a certain scale, companies tend to be simple. Pursuing greater market share while ignoring the impetus for product upgrades and industrial transformation; for example, new technologies often encounter greater resistance when they are transformed into productivity, which is related to the lack of a certain degree of innovation policy in China; Due to the relative inertia of China’s traditional cultural inertia, although the government, society, and more and more companies have continuously emphasized innovation in recent years, it is necessary to form the innovative ecology and open mind needed to create a super-innovation enterprise, willing to take risk, diligence, and interest. Sex and the way of thinking that dares to challenge authority cannot be formed overnight.

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