Source: China Science Daily 2013-03-06 Page02
Written by: Zhang Qiaoling, Jiang Tianhai
Translated by: Yang Qing

The output value of China’s manufacturing industry exceeded that of America’s, accounting for 19.8 percent of the global manufacturing output, and jumped to the first place in the world in 2010. From the aspect of output value, China is worthy of the reputation as an industrial power. However, the added value of “made-in-China” is far below that of some developed countries. In the FT Global 500 2011, there are 73 American companies, while only 6 are from mainland China.

Mao Yunshi, member of the CPPCC National Committee, professor of the School of Management, Sun Yat-sen University and Director of Enterprise and Market Research Center, Sun Yat-sen University, suggested that it is necessary to accelerate the transformation and upgrading of “made-in-China” and to transform from a large industrial country to a strong industrial power.

Mao Yunshi thinks that in order to transform from a large industrial country to a strong industrial power, it is necessary to comb and analyze the connotation and the overall structure of “made-in-China”. In terms of connotation, the “made-in-China” has some characteristics as follows:

First, assembled in China; second, assembled in China with a brand but without Chinese chips; third, Chinese OEM; fourth, Chinese ODM; fifth, made-in-China components. However, the key technology and components of many domestic products mainly depend on import; sixth, made-in-China special equipment. Two thirds of the equipment of the whole social fixed assets investment relies on import. The rate of import of fiber-optical manufacturing equipment is 100%, integrated circuit chip manufacturing equipment 85%, petroleum & chemical equipment 80%, cars, computer numerical control (CNC) machines, textile machinery and offset printing equipment 70%; seventh, the lack of key technology and independent intellectual property rights in joint venture manufacturing; eighth, joint venture manufacturing with independent research capability and independent intellectual property rights; ninth, independent manufacturing based on imitation and innovation. Independent intellectual rights are formed after digesting, absorbing and innovating. Tenth, independent manufacturing based on original innovation. Important technological breakthroughs can be made to have a strong power of discourse and to lead the development of the industry. However, the original innovation capability of “made-in-China” is still at a relatively low level and further breakthroughs are expected in emerging industries.

Mao Yunshi proposed that to realize the objective of transformation and upgrading, we need to take actions from the following aspects. Firstly, promote the standard of “made-in-China” at the level of national strategy, seize the high ground of standard, and facilitate the standard of “made-in-China” to gear to international standards. Secondly, make breakthroughs in key technologies and core components to form high-end independent intellectual property rights. Thirdly, reform traditional industries through technological innovations and cultivate and develop strategic emerging industries. We need to take the opportunity of developing strategic emerging industries to cultivate our own brands. Fourthly, promote the whole upgrading of “made-in-China” by making big companies lead the small ones. Policies and strategies should be made to support the development of manufacturing networks, form collaborative alliances in which big enterprises can lead the small ones, and encourage the sharing of research facilities and technical information. Fifthly, form a diverse system of innovation, boost the transformation of technological achievements in manufacturing, accelerate the construction of public technology platforms, build efficient transformation institutions for the industrialization of scientific and technological achievements, and promote knowledge diffusion and technology transfer in manufacturing. Sixthly, follow the trend of blurring industry boundaries, facilitate the intersection and integration of manufacturing and modern service industry, and form a modern service system geared to industrial production. Seventhly, develop business with high added value and technical content, speed up the upgrading of process, function and product, and promote energy conservation, environmental protection and low-carbon operation to indirectly increase the added value of the enterprise.