‘China continues to pursue a wide array of industrial policies that seek to limit market access for imported goods, foreign manufacturers, and foreign services suppliers, while offering substantial government guidance, resources, and regulatory support to Chinese industries.’
‘One of the more far-reaching and harmful industrial plans is known as “Made in China 2025”.’
‘While ostensibly intended simply to raise industrial productivity through more advanced and flexible manufacturing techniques, Made in China 2025 is emblematic of an evolving and increasingly sophisticated approach to “indigenous innovation,” which is also evident in numerous supporting and related industrial plans.’
‘Their common, overriding aim is to replace foreign technologies, products, and services with Chinese technologies, products, and services in the China market and, with this foundation, to enable Chinese companies to dominate international markets.’
‘Even if China fails to fully achieve the industrial policy goals set forth in Made in China 2025, it is still likely to create or exacerbate market distortions and create severe excess capacity in many of the targeted sectors. It is also likely to do long-lasting damage to U.S. interests, as China-backed companies increase their market share at the expense of U.S. companies operating in these sectors.’
‘The 2021 National Trade Estimate Report on Foreign Trade Barriers' (NTE) released by the USTR this week.
- The China section of the report is 36 pages. To read just that section click here.
- You can read the full 574-page report here.
And here is a section from the China part about the threat of ‘Made in China 2025.’
‘NON-TARIFF MEASURES’
‘Industrial Policies’
‘China continues to pursue a wide array of industrial policies that seek to limit market access for imported goods, foreign manufacturers, and foreign services suppliers, while offering substantial government guidance, resources, and regulatory support to Chinese industries.’
- ‘The beneficiaries of these constantly evolving policies are not only state-owned enterprises (SOEs) but also other domestic companies attempting to move up the economic value chain.’
‘One of the more far-reaching and harmful industrial plans is known as “Made in China 2025”.’
- ‘China’s State Council released this industrial plan in May 2015.’
- ‘It is a ten-year plan targeting ten strategic sectors, including advanced information technology, automated machine tools and robotics, aviation and spaceflight equipment, maritime engineering equipment and high-tech vessels, advanced rail transit equipment, new energy vehicles (NEVs), power equipment, farm machinery, new materials, biopharmaceuticals, and advanced medical device products.’
‘While ostensibly intended simply to raise industrial productivity through more advanced and flexible manufacturing techniques, Made in China 2025 is emblematic of an evolving and increasingly sophisticated approach to “indigenous innovation,” which is also evident in numerous supporting and related industrial plans.’
- ‘Their common, overriding aim is to replace foreign technologies, products, and services with Chinese technologies, products, and services in the China market and, with this foundation, to enable Chinese companies to dominate international markets.’
‘Made in China 2025 seeks to build up Chinese companies in the ten targeted, strategic sectors at the expense of, and to the detriment of, foreign industries and their technologies through a multi-step process over ten years.’
- ‘The initial goal of Made in China 2025 is to ensure, through various means, that Chinese companies develop, extract, or acquire their own technology, IP, and know-how and their own brands.’
- ‘The next goal of Made in China 2025 is to substitute domestic technologies, products, and services for foreign technologies, products, and services in the China market.’
- ‘The final goal of Made in China 2025 is to capture much larger worldwide market shares in the 10 targeted, strategic sectors.’
‘Many of the policy tools being used by China to achieve the goals of Made in China 2025 raise serious concerns.’
- ‘These tools include a wide array of state intervention and support designed to promote the development of Chinese industry in large part by restricting, taking advantage of, discriminating against, or otherwise creating disadvantages for foreign enterprises and their technologies, products, and services.’
- ‘Indeed, even facially neutral measures can be applied in favor of domestic enterprises, as past experience has shown, especially at sub-central levels of government.’
‘Made in China 2025 also differs from industry support pursued by other WTO Members by its level of ambition and, perhaps more importantly, by the scale of resources China is investing in the pursuit of its industrial policy goals.’
- ‘Indeed, by some estimates, the Chinese Government is making available more than $500 billion of financial support to the Made in China 2025 sectors, both through the Made in China 2025 industrial plan and related industrial plans.’
‘Even if China fails to fully achieve the industrial policy goals set forth in Made in China 2025, it is still likely to create or exacerbate market distortions and create severe excess capacity in many of the targeted sectors.’
- ‘It is also likely to do long-lasting damage to U.S. interests, as China-backed companies increase their market share at the expense of U.S. companies operating in these sectors.’
‘As discussed above, the U.S. Section 301 investigation and resulting tariff and other actions seek to address China’s forced technology transfer regime.’
- ‘This regime is one of the instruments through which China intends to meet its Made in China 2025 targets.’
‘While public references to Made in China 2025 subsided after June 2018 reportedly in response to an order from the central government, it is clear that China remains committed to achieving the goals of Made in China 2025 and continues to seek dominance for Chinese firms in the sectors it considers strategic, both within China’s market and globally.’
