2015 has been an unprecedented year for China and its economic performance, from the lowest pace of growth in the last 25 years, the cut on the GDP growth targets, the bare growth in the CPI and the “New Normal” in the Economy and all its implications broadly named and quoted by policy makers and economists around the globe, seem to represent an inflection point for the way things are done inside of the second world biggest economy,
Early this year at the World Economic Forum Meeting in Davos, China’s Prime Minister Li Keqiang mentioned in his speech that;
“The Chinese economy has entered a state of new normal. The gear of growth is shifting from high speed to medium-to-high speed, and development needs to move from low-to-medium level to medium-to-high level. This has made it all the more necessary for us to press ahead with structural reform.”
Alongside this statements and the current news always talking about what might represent this new state of the economy, in the recent meetings of the CPC as part of the new strategies and reforms in the country Premier Li, addressed a series of reforms and strategies needed to apply for ensuring that this new pace of growth will be reached and maintained.
During the last couple of decades “Made in China” has been taken as synonym of poor quality which has result as a big stigma for China, in the recent times some Sino brands had started to change that impression switching a bit the scale towards the Chinese manufacturers showing that high quality and innovation is achievable.
To accelerate the transformation of China from a big manufacturing power to a strong manufacturing power, Premier Li Keqiang advanced the “Made in China 2025” concept in his Government Work Report to the top legislature this year. There are three stages to the transformation that will take about three decades all together. “Made in China 2025” is the guideline for the first decade. It will lay a solid foundation for the next two stages.
The plan calls for moving away from simple, labor-intensive production to create by 2025 a sophisticated manufacturing sector on a par with those in industrialized countries. It promotes research and development, includes generous measures favoring high-tech fields and looks to encourage technological advancement and the rise of new industries.
It focuses on an innovation drive, intellectual property and green development. The authorities will also provide preferential policies to promote the restructuring of the traditional manufacturing industry, and support enterprises’ mergers and reorganization, as well as market competition. Industrialization and informatization will be deeply integrated to make breakthroughs in some key fields.
Minister of Industry and Information Technology Miao Wei said the “Made in China 2025” strategy is of great significance to the development of China’s manufacturing industry. In 2010 China became the biggest manufacturing power in the world, but not a strong manufacturing power as China lacks enterprises and products that have international competitiveness. It is expected that the “Made in China 2025” plan will lift the country into the second tier of the global manufacturing industry by then.
Specifically, Beijing will seek to turn such areas as telecommunications networks, semiconductors, alternative energy, new materials, biotechnology, aircraft engines and gas turbines into leading industries that can succeed globally, according to Li.
The government will provide financial support for the shift, setting aside a 40 billion yuan ($6.38 billion) fund for emerging industries and creating a private-equity market for small and midsize enterprises.
Previous industrial promotion measures, which had been predicated on low labor costs, have started to run into problems. Manufacturers the world over had flocked to China, considered the world’s factory, but the minimum wage has soared more than 50% over the past five years in such major cities as Beijing and Shanghai.
The government will encourage a move to “value-added” industry, such as by installing industrial robots at factories.
Seems that the path has been setted, now its time that China drives itself into a new horizon of manufacture and economic performance.