Upgrading their Manufacturing

Upgrading their Manufacturing

At the start of the century, China was developing at an extraordinary rate. Its development model was based on low-manufacturing that was combined with higher savings and investment rates. This model came to be a success that helped raise the living standards, but not led to the government to adopt policies that will help upgrade the country’s industry. It is noted that China is currently in a “middle-income trap” and is working towards escaping. This trap is a result from the failure of the country to have a faster labor productivity growth within their technological innovation and industrial upgrading compared to high-income countries. Industrial policy is vital for the government to prioritize the different uses of the limited resources given to aid technological innovation and industrial upgrading. In regards to the industrial business model Premier Li Keqiang said, “China is already a big manufacturing nation, but far from manufacturing power… integration of manufacturing and the interned is an inevitable path of modern industry.” 

China is stuck in the middle being pressure by the advanced economies as well as the emerging ones. By investing in becoming automated as well as efficient, advanced economies like the US, Germany and Japan are developing their own manufacturing plans. On the other hand, the emerging countries such as India and Brazil are finding was to just catch up.


China s manufacturing is big, and impressive, but it is not that strong. The country is capable of overcoming these concerns. Although being “trapped”, their manufacturing is still capable of performing well. Currently, the country ranks first in the world in 220 out of 500 major types of industrial products and is also home to many world-leading infrastructure projects. The government is currently trying to figure out the best way to upgrade their manufacturing in the quickest way possible. The world is going through the 4th industrial revolution, and in the coming years, a new structure will be emerging among the leading countries.

The country has devised another 5-year plan that outlines a set of policies to help optimize the modern industrial system that will be able to prosper in this environment. They want to focus on carrying out structural adjustment that will help revitalize the economy. The country wants to focus on supply-side structural reforms that will encourage new industries while upgrading the traditional ones and to quickly implement new modern industrial systems with strong innovative capabilities that will also provide quality service.

The government has realized that upgrading the industrial and manufacturing sectors is key to helping their economy flourish. They have allocated a certain amount of money to help improve the following sectors, such as industrial technology.