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The never-ending China rise

Published: 13 May. 2024, 19:36

HAN WOO-DUK
The author is a senior reporter of the China Lab.

Eight months left until the target year of “Made in China 2025.” The success rate is at 86 percent, according to Hong Kong’s South China Morning Post. The newspaper reported that it is more meaningful as it is an achievement made in the face of the economic pressure from the United States since 2018.

How did “Made in China 2025” change Chinese industries?

Three years ago, Xiaomi founder Lei Jun publicly declared that his company will produce smart electric vehicles (EVs). He kept his promise. In March, the “SU7” smart EV went on sale. It was made possible thanks to the overall manufacturing capability of China, which produces almost everything from sneakers to cars, toothpicks to rockets. It also has excellent technology. Its battery — the core of EVs — is world-class, as is other smart technology. The market is also solid. China is the biggest automobile producer and market. That’s why Lei Jun was able to present SU7 without worrying about selling them. The quality is controversial, but Xiaomi added an automobile in its ecosystem. There are three elements for industrial development — manufacturing capability, technology and market. China is the country with all three. That’s the change “Made in China 2025” has brought.

In the era of globalization, manufacturing, technology and markets could move separately. Products were made with technology developed in Germany, manufactured in China, and sold in the U.S. But in the era of ruptured supply chains, a country that can handle the three has the upper hand. It is no wonder some people say, “China is becoming a country that can do anything and start anything.”

Western industries are frightened by the attack of China’s high-tech products. The European solar power industry has already been devastated. Countries are building high barriers to protect themselves from China’s “deflation export.”

It is happening in Korea, too. Korea’s distribution industry is shaking due to the onslaught of AliExpress and Temu. China has the manufacturing capacity to produce goods more cheaply than any other country in the world. The country also built e-commerce technology through domestic competition. The vast market has produced extremely low-priced goods. It is the harmony of manufacturing, technology and market.

Made in China 2025 will expire next year, but it is not the end. The New Quality Productive Forces will take the baton as a policy to foster high-tech industry. The scope is expanding to AI, commercial aerospace and biotech. The West will be even more nervous. Made in China 2025 will be over soon, but yet another crack will hit the global economy.