China Drafts a Five-Year Economic Plan to Overtake the U.S.
Ariel C. Go
International Business News Writer
With its growing exposure to the rest of the world, China has established itself as an important supplier, provider, and market of capital. According to the McKinsey Global Institute, which is ranked the top think-tank in the world for private sectors, China accounts for 35 percent of global manufacturing output. As the largest market in the world in many categories such as mobile phones and luxury goods, China accounts for approximately 30 percent of global consumption. This is all motivated by China’s domestic demand to produce everything.
Despite these promising statistics, the leaders of China are concerned about how heavily they depend on the United States for certain technological products like semiconductors. With core high-tech goods in the hands of others, Miao Wey, the former Minister of Industry and Information Technology is aware of the risk of “being hit in the throat.” Furthermore, China faces problems within the country itself. Manufacturing during 2020, accounted for only a quarter of its GDP, which in comparison to past data shows that the manufacturing output of the country as a percentage of its economy has decreased considerably since 2012.
To address these existing problems, China developed a draft of its 14th economic plan, which will be administered over the next five years. One of its main initiatives is to expedite and facilitate the development of advanced technologies, including artificial intelligence and silicon chips. This is a result of the frequent experiences of Chinese companies, such as Huawei, with the Trump administration impeding them from accessing U.S. technology and buying essential components for their products. Therefore, Chinese leaders would like to make it a top priority to become fully innovative and establish its own nationally recognized chip maker.
In addition to the technological situation, the five-year plan also focuses on seven other strategic areas that China deems critical to the protection and security of the country. Which includes neuroscience, aerospace, and quantum computing. China also plans for business and market-oriented reforms on various competitive sectors, urbanization to lessen poverty and create more jobs, as well as initiatives to tackle environmental protection and climate change.
In a speech to the delegates of the Chinese People’s Political Consultative Conference, Miao Wey acknowledged that China’s manufacturing industry has made outstanding achievement in the past year, but he also claimed that China is over 30 years away from converting itself into a manufacturing nation of “great power.” “We must maintain our strategic resolve, stay clear-headed, and deeply understand the gaps and deficiencies.”
Contact Ariel at Ariel.go@student.shu.edu