Japanese media article:China’s top manufacturing industry cannot be shaken
The Japanese”Nikkei Asian Review” magazine website published an article on November 18, saying that China’s operating scale is completely different from neighboring countries; the competitiveness of China’s manufacturing industry has an extremely broad foundation; Neighbors in developed and emerging markets pose far-reaching challenges. The full text is excerpted as follows:
Thinking that China has passed the peak of manufacturing is lingering and misleading.
China’s manufacturing industry is in fact extremely resilient, as evidenced by its continued growth and global export competitiveness. China’s manufacturing industry has survived the trade and tariff wars, has been largely unharmed, and has begun to prepare for the long-term leadership of the country in the manufacturing of various products, from automobiles to consumer electronics.
It is true that certain manufacturing industries have moved from China to neighboring countries. However, changes in the supply chain do not seem to have any negative impact on the continuous progress of China’s manufacturing industry.
To a certain extent, this reflects the fact that China’s business scale is completely different from that of neighboring countries. Its manufacturing output exceeds that of other Asian countries combined. Japan, the second largest manufacturing country in the region, has only a quarter of China’s manufacturing output. In India, despite its efforts to develop its manufacturing base under the”Made in India” initiative, its output is only about one-tenth of China’s. Although Vietnam’s manufacturing growth is remarkable, its industrial base is only a small part of China, and it is concentrated on a relatively small number of products.
In this regard, the transfer of certain production to neighboring countries did not harm China’s manufacturing base. In fact, contrary to the view that the peak of China’s manufacturing activity has passed, China’s manufacturing sector has rejuvenated in recent years. From 2016 to 2019, China’s manufacturing output in local currency has experienced the fastest growth in the three years since 2013. The growth in 2017 and 2018 was particularly strong.
Since 2016, China’s share of global manufacturing exports has actually increased. In 2019, it accounted for 18%, the second highest level in the past two decades.
This increase is unmatched by any other major exporting country. Germany, the United States, Japan, and South Korea all lost their share of global manufacturing exports during the same period. Within Asia, since 2016, China’s export value has increased more than all other countries in the region combined.
The competitiveness of China’s manufacturing industry has an extremely broad foundation. Its exports of various products around the world are still growing, from labor-intensive products to technology-intensive products, and in fact, in the past three years, most of China’s manufactured products have grown in the global export market, including many Textile-related products-probably the products most susceptible to the relocation of factories abroad.
However, at the same time, China has established local competitiveness in more and more skilled and technology-intensive manufacturing activities. In many of these production sectors, Chinese companies are gaining international leadership through technological innovation and product development. This is reflected in their increased competitiveness and increased share of global exports.
The continuous development of China’s manufacturing strength has caused far-reaching challenges to the developed and emerging market neighbors, not to mention policies. Developing and maintaining an internationally competitive manufacturing industry is the core content of economic growth. China’s industrial policies and potential international competitiveness have affected the more developed economies in Asia, and advanced export-oriented industries have been largely replaced.
So, the real question is:How can Asian countries find the right way to adapt to the results of China’s drastic industrialization and unparalleled competitiveness. Their response will determine whether China’s top position in the regional (if not global) manufacturing hierarchy is indestructible.
A production workshop of Fuyao Glass Industry Group, a major glass manufacturer in the world, in Fuqing City, Fujian Province. (Data Picture)
Source:Reference News Network