“Made in China 2015”: China to strengthen its manufacturing capabilities

The Chinese government unveiled on Tuesday a new national plan called “Made in China 2025” and aimed at boosting the country’s manufacturing capabilities. Premier Li Keqiang personally endorsed the new initiative adding that this is the first time a ten-year plan is specifically designed for promoting China’s manufacturing. Beijing wishes to get rid of the common image of China as “the factory of the world” and start focusing on innovative technologies. The goal is to go from “Made in China” to “Created in China”, transforming the country from a manufacturing giant into a global manufacturing power.

The new plan [cml_media_alt id='1525']Seagate_Wuxi_China_Factory_Tour[/cml_media_alt]was first announced last March, during the annual session of the National People’s Congress, and is set to foster innovation and technology. During a recent visit to “China’s Silicon Valley”, Premier Li also underlined the importance of two actions: to streamline of the bureaucratic procedures and to cutoff the unnecessary government approvals. These recently announced measures will help drive China’s creativity and, together with a wider restructuring of the sector itself, will help relieve overcapacity in key industries, such as steel.

Struggling with the increasing international competition, a slowing of domestic economy, and weak demand, China is trying to redirect the whole sector towards more efficient industries with a technological upgrade. The manufacturing sector is facing the consequences of bigger constraints from the environment, resources and rising labor costs, which notably dampened foreign investment in the sector. In fact, the average monthly wage of factory workers corresponded to RMB 2.832 (€411) in 2014, up 11.6% year-over-year, according to official data released last month.

With “Made in China 2025” the government vowed to boost 10 high-technology industrial sectors including robotics, aerospace, new-energy vehicles and advanced transport. Moreover, the new plan will be followed by other two plans in order to achieve world’s leadership in manufacturing by 2049, which will be the 100th anniversary of the foundation of People’s Republic of China. Beijing wants to enhance especially the automation processes in the industrial sector through an increasing presence of robots. In the next three years the South-eastern province of Guangdong, one of the most important manufacturing area of the country, is expected to invest RMB 943 billion (a little more than €140 billion at current exchange rate) to realize the transition to robots in all major industries, from the automotive to textile, from electronic to constructions. Internet technologies and cloud computing will also be embraced in the plan.

“Made in China [cml_media_alt id='1526']9597782464_b30d1a87ba_m[/cml_media_alt]2025” will be combined with financial support and institutional reforms, even if no further details on how these will be realized were provided. Beijing wants to increase research spending to 1.68% of manufacturing revenues by 2025 from 0.88% in 2013. The implementation of the new plan will be market-oriented, though guided by the government – according to the notice – and will involve five major projects, among which the establishment of a manufacturing innovation center and the effort of boosting intelligent manufacturing. Miao Wei, Minister of industry and information technology (MITT), said the realization of the plan means “by 2025 … China will basically realize industrialization nearly equal to the manufacturing abilities of Germany and Japan at their early stages of industrialization.”

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