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Made in China 2025: China’s strategy in becoming a tech leader

DIGITAL VENTURES March 06, 2019 7:58 PM

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In China’s tech scene, aside from the IT giants, an accelerator supporting the industry is the government and their policies. Made in China 2025 is, no doubt, the most outstanding policy. It discusses promoting the economy through the tech industry, especially with deep technology R&D. What is Made in China 2025’s strength and core features, let’s find out with Digital Ventures.

 

 

The inspiration

China’s industries in Made in China 2025 was inspired by Germany’s industry 4.0 plan. It aims to become the world market leader in the tech sector via 10 core industries. This plan has made China competitive in the innovative economy and is on par with an innovation leader like the USA.

 

The strengths

Recent economic results caused several countries to analyze China’s tech industry for its rapid development. In the past years, we observed that the numbers for China’s innovative business experienced leaping growths. This contradicts with the familiar reputation as the “world’s factory”. Some of China’s main highlights are listed below.

  • China houses one of the world’s largest consumer base. According to the 2019 world ranking by Worldometers, China has the highest number of populations in the world at 1.4 billion. The population is important, both in terms of talents in the tech scene and the massive number of consumers.
  • Strict measures for foreign tech firms operating in the country. China is very strict with foreign firms who wish to operate in China, and this is particularly true with tech businesses. Today, global IT giants like Google or Facebook still face various regulations and they are unable to fully operate in China. 

 

As a result, China can effortlessly encourage similar forms of services in the country. In turn, this propelled the nation’s innovation such as Alibaba’s e-commerce service, Tencent’s social media, or Baidu’s digital service.

 

Crisis to trade opportunity

Aside from producing tech equipment and parts for leading global brands, China has adopted their knowledge for further applications. This is the key turning point that has led to today’s infrastructure and innovation. SCB Economic Intelligence Center discusses China’s 4 strategies in innovation development as follow:

  • Production according to the original (Adopter). In the past years, China is well-known for outsource manufacturing of equipment for several industries, especially in the tech business. Thus, their knowledge derives by further developing from the originals.
  • Alter originals and produce own goods (Adapter). The knowledge and production details are used to recreate products and also produce their own goods.
  • Synthesize and further develop from the original (Applier). This is the core factor that contributes to China’s great performance in innovation. Development that stems from the original coupled with sufficient knowledge and basic manufacturing process leads to the value-added potential that exceeds the original.
  • Research for innovation (Innovator). Development from an original by creating a better product is a starting point for tech advancement. Today, we see that China houses numerous new technologies such as AI that is applied in various businesses and used to invent more products.

 

These 4 strategies are the success factors for tech development in Asia. However, this strategy may prove insufficient for the future. Therefore, China issued a long-term plan by focusing on self-development in deep technology.

 

 

10 core industry (Made in China 2025)

The President of China, Xi Jin Ping, initiated Made in China 2025. It is aimed to nurture innovation by supporting the production of high-end innovation which focuses on quality rather than quantity. It supports manufacturing that will create credibility for Chinese brands, nurture talents to enhance the overall quality of life, and utilize environmental-friendly energy. Made in China 2025 has 10 key industries for future development.

 

  • New Information and Communications Technology (ICT) industry involve high-speed tech development by using deep tech such as quantum computing and artificial intelligence which will increase efficiency.
  • Robotics industry shall be automated and smarter with better analytic skills and understanding of the human language.  
  • Aerospace industry is aimed at becoming the leader in aerospace innovation production with the best efficiency in the world.
  • Ocean engineering and high-tech ships industry involves building ships from deep tech for better efficiency.  
  • Rail transit equipment industry is manufacturing high-speed trains with state-of-the-art innovation.
  • Energy saving and smart vehicles industry produce vehicles that run on new alternative, eco-friendly energy.
  • Electricity equipment industry aims for R&D that will create new, applicable alternative energy.
  • Agriculture equipment industry will build agricultural innovations that become solutions for the manufacturing sector and the economy.
  • New materials industry involves innovations that match products in the tech era.
  • Biopharmaceuticals and medical equipment industry will develop pharmaceuticals and medical equipment with advanced technologies.  

 

Made in China 2025 has put China in the spotlight. Also, we see a positive trend with support from the government, who is also leading this massive scheme. We have more stories about China’s tech development plan. Follow Digital Ventures for more updates.

Thank you for the information from scbeic.com,  worldometers.com, china-briefing.com, and nytimes.com.