Japanese media: China's manufacturing industry is resilient and competitive
2021-09-15: [Original Article Link].
Japan's "Nikkei Asia Review" September 14th article, original title: China's manufacturing machinery is accelerating operation Subtopic: Continued resilience creates increasing competitiveness despite various unfavorable factors, including the raging global supply chain to reduce its dependence on China, but comprehensive data show that China's manufacturing industry not only has lasting resilience, but also its competitiveness is increasing day by day. This is most evident in China's strong trade performance. China's share of global manufactured exports soared to a record 20% in 2020, up from 9 percent in Germany, 7 percent in the United States and 4 percent in Japan.
However, many people still claim or hope that China's manufacturing competitiveness is or is about to decline, driven by higher costs, more serious trade frictions and changing geopolitics. However, such projections oversimplify the factors that determine a country's industrial competitiveness. The argument that rising labor costs will automatically lead to a decline in international competitiveness is untenable. This simplistic view ignores the importance of relative productivity.
A variety of factors suggest that China's manufacturing position remains very solid. The first is the unprecedented scale of China. The huge volume can support a larger domestic industrial ecosystem, with a higher degree of specialization, stronger technological innovation ability, larger production scale and lower unit cost. More importantly, China's domestic diversity enables it to maintain excellent competitiveness in all areas of manufacturing. This is in stark contrast to smaller, more resource-limited countries, including China's neighbors.
The second is China's ability to organize and allocate resources through active industrial policies. No other country, including potential competitors such as India, has such a strong sense of developing its own manufacturing industry. This gives China a crucial comparative advantage.
The third is that China has almost completely dominated the Asian economic system. Trade flows are inherently regional rather than global. Therefore, as the global economic center of gravity shifts to Asia, China will benefit from it. Therefore, for China's neighbors, denying China's super manufacturing competitiveness or wishful thinking that it will disappear is not a wise response. (Translated by Ding Yuqing)
Note: This is auto-translated version of an article meant for Chinese audience. A mature and nuanced reading is suggested.