Since the 18th National Congress of the Communist Party of China (CPC), the industry and information technology system has taken Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era as the guidance, thoroughly studied and put into practice Xi Jinping Thought on Economy, fully implemented the decisions and deployments of the CPC Central Committee and the State Council, and vigorously carried out the strategies of building China’s strength in manufacturing and cyberspace. All of these efforts have driven China’s industry and information technology to achieve historic results, significantly enhanced China’s economic, technological and overall national strengths, greatly consolidated the foundation of China’s economic development, and contributed to the stability of industrial chain and supply chain, and the economic development around the world.
1. China’s industrial economy has continued its stable growth, and efforts have been exerted to build a stronger foundation for stabilizing the overall economy
General Secretary Xi Jinping said that the manufacturing industry is the very foundation for building China and improving its strength, and the lifeblood of the national economy, emphasizing that we should put our focus on the real economy to steadfastly make it and the manufacturing industry better and stronger. In face of severe and complicated economic situations both at home and abroad, the Ministry of Industry and Information Technology has earnestly implemented the decisions and arrangements of the CPC Central Committee and the State Council, upheld the underlying principle of promoting progress while ensuring stability, and taken steps to fulfill the tasks of ensuring stability on the six fronts and security in six areas in earnest. We have strengthened and improved industrial management, and actively responded to external shocks and impacts, in order to maintain stable industrial economy and a generally steady proportion of the manufacturing, so as to build a stronger foundation for stabilizing the overall economy with full efforts. From 2012 to 2021, the industrial added value of China grew from RMB20.9 trillion to RMB37.3 trillion. Calculated at constant prices, the annual industrial added value increased by 6.3% on average, much higher than that of the world average, which was about 2% during the same period. In the meantime, the added value of the manufacturing industry increased from RMB16.98 trillion to RMB31.4 trillion, with its proportion in the world total rising from 22.5% to nearly 30%. Some 60% of the raw materials, such as crude steel, cement, electrolytic aluminum and methyl alcohol are produced by China. Regarding the output of new products such as smart phones, computers, TVs and industrial robots, we are also the top one in the world. In addition, our products have continuously improved their international competitiveness, and the export of our industrial products have covered almost every country and region around the world. The trade of intermediate goods in the manufacturing industry accounts for about 20% of the world, and our communications equipment, high-speed rail and shipping have had a prominent edge in international competition. The sense of gain of the people has increased significantly with, for example, the universal access to smart home appliances, the availability of functional fiber products and bio-based fiber products to families, and higher car ownership per 1,000 people, which went up from 89 in 2012 to 208 in 2021.
2. Enhance the advantage in having a complete industrial system and improve the resilience and competitiveness of industrial chain and supply chain
General Secretary Xi has emphasized that the industrial chain and supply chain should not drop the ball at a critical moment, and we should do a good job in industrial base upgrading and industrial chain modernization, and maintain a complete industrial system in the world. Based on China’s advantages in industrial scale, industrial supporting and as a first mover in some fields, we have made an overall plan to tackle our weaknesses and bring out our strengths, and implemented the industrial foundation reengineering projects and actions on reinforcing and upgrading the chains in manufacturing, to keep improving the resilience and competitiveness of the industrial chain and supply chain. The basic industrial capacity has been continuously enhanced, with scale application of a number of key basic products and materials, such as rail traffic, power equipment, aluminum alloy for aerospace use, and high-performance fibers and composite materials, and higher reliability, consistency and stability of basic products. With the aim to enhance the supply capacity of generic technologies, we established 22 national manufacturing innovation centers, including those for power batteries and additive manufacturing, and 2 national-local jointly built manufacturing innovation centers for silicon-based hybrid integration. Besides, we promoted the building of over 200 provincial manufacturing innovation centers, and supported the building of 125 basic public service platforms for industrial technologies. Emerging industries have accelerated their development. New products, such as serving robots, charging piles and smart wearable devices, have grown with strong momentum. In 2021, the output of new energy vehicles reached 3.545 million, while the output value of our new materials industry has doubled. The industrial system is more comprehensive, with 41 two-digit, 207 three-digit and 666 four-digit industries, making China the only country in the world that has all the industrial divisions under the United Nations’ industrial classification. In response to the impact of the COVID-19, we solved the shortage of medical protective clothing, masks, medical equipment, drugs, test kits and other epidemic prevention supplies in the shortest time. Up to May 2022, China had provided 4.6 billion sets of protective clothing, COVID-19 test kits for 18 billion people, more than 430 billion masks, and 2.2 billion doses of COVID-19 vaccines to 153 countries and 15 international organizations.
3. Concrete results have been made in industrial restructuring, and China manufacturing has moved faster towards the middle- and high-end of the global value chain
General Secretary Xi has stressed that optimization and upgrading of industrial structure is key to improving the comprehensive economic competitiveness of China; that we should promote the deep integration of the Internet, big data, artificial intelligence and the real economy, and continue to do a good job in the deep integration of IT application and industrialization; and that we should accelerate the research on green and low-carbon technologies, and continue to promote the optimization and upgrading of industrial structure. The MIIT has adhered to the supply side structural reform as the main line to promote digital transformation of the manufacturing industry, advance green and low-carbon industrial development, speed up the development of emerging industries, as well as shut down outdated production facilities and resolve excess capacity. The middle and high-end industries are taking an increasingly higher percentage in the industrial structure. The percentages of high-tech manufacturing and equipment manufacturing in the added value of industrial enterprises above the designated size increased from 9.4% and 28% in 2012 to 15.1% and 32.4% in 2021, respectively contributing 28.6% and 45% to the growth of those industrial enterprises. Remarkable achievements have been made in eliminating outdated and resolving excess capacities. The iron and steel industry fulfilled the target of reducing production capacity by 150 million tons during the 13th “Five-year Plan” period two years ahead of schedule, and 140 million tons of “substandard steel” have been fully cleared. The outdated production facilities of electrolytic aluminum, cement and other industries have been basically shut down. The digital level of the manufacturing industry has improved significantly. By the end of 2021, the numerical control rate of key processes and the popularity of digital R&D and design tools in industrial enterprises nationwide reached 55.3% and 74.7% respectively, 30.7 and 25.9 percentage points higher than those in 2012. More than 700 digital workshops/intelligent factories have been built, enabling the refining and chemical, printing and dyeing, home appliances and other fields to lead the world for their intelligent manufacturing. The industrial Internet platforms have connected more than 78 million units/sets of equipment, serving more than 1.6 million industrial enterprises. Industry has sped up its green transformation. The energy consumption per unit of added value of industrial enterprises above the designated size declined by 28% and 16% respectively in the 12th and the 13th “Five-year Plan” periods, and the figure further went down by 5.6% in 2021. Likewise, the water consumption per 10,000 yuan of industrial added value further decreased by 7% in 2021 on the basis of the respective reduction of 35% and 39.6% in the 12th and the 13th “Five-year Plan” periods. In 2020, the comprehensive utilization rate of general industrial solid wastes reached 55.4%, recycling about 380 million tons of renewable resources. Since 2012, the compound annual growth rate of the total output value of the environmental protection equipment manufacturing industry has surpassed 10%. Regional industrial development has been more coordinated. We have implemented major national strategies for regions and created regional growth poles in manufacturing by fostering 445 national new industrialization demonstration bases, and guiding them to improve their level of cluster development. The number of enterprises in those bases has exceeded 4 million, out of which more than 10,000 are listed companies. Contributing to over 30% of the country’s industrial added value and import and export volume, and more than 40% of the total profits, they have become an important carrier for China’s industrial transformation and upgrading, and the building of strength in manufacturing. We carried out a special action to cultivate advanced manufacturing clusters and selected 25 as national advanced manufacturing clusters, to promote a development ecosystem of “industry + technology + finance + talents”, and build a source of momentum for high-quality development of the manufacturing industry.
4. Major breakthroughs have been achieved in innovation in key areas, accelerating the transformation from China Manufacturing to China Creation
General Secretary Xi Jinping has emphasized that innovation should be placed at the heart of driving the development of the manufacturing industry. The MIIT has continued to implement the strategy of innovation-driven development, and promoted coordinated implementation of major projects, initiatives and special programs. The development of an industrial technology innovation system has been accelerated - under which enterprises play the principal role in market-oriented innovation and enterprises, universities, research institutes and end-users are deeply integrated – so that more focus will be given to improvement in systematic capacity instead of individual, standalone breakthroughs. The “Fuxing” high-speed EMU train that runs all over China has become a better option for faster and more comfortable travel. The “Fendouzhe” (Striver) deep-sea manned submersible has reached the Mariana Trench and completed 21 10,000-meter dives, breaking the world record in terms of the number of 10,000-meter dives and divers. Major progress has been achieved in the R&D of the C919 large passenger aircraft, which will soon be certified for airworthiness and delivered to customers. The one-million-kilowatt hydro-generator unit, with the world’s largest single-unit capacity, has been put into operation at the Baihetan Hydropower Station and every year, the unit can produce electricity that satisfies the daily needs of about 75 million people in a whole year. The super-sized shield machine, named “Jinghua”, has been put into operation, ready to support nationwide transportation connectivity with its powerful tunneling capacity. Mobile robots, underwater robots, cleaning robots, drones and other technologies as well as high-end medical imaging equipment such as magnetic resonance and ultrasound imaging have gained global leadership. Compared with 2012, the gravimetric energy density of the power cell of new energy vehicles has increased by 1.3 times, with a price drop of 80% and a rise in the driving range of mainstream models from 150 kilometers to more than 500 kilometers.
5. The world’s largest network infrastructure has been built, with leading technology, guaranteed operation, and global leadership in 5G
General Secretary Xi Jinping has attached great importance to strengthened development of information infrastructure, the in-depth integration of information resources, and unblocked information “artery” for economic and social development. The MIIT has followed basic trends and laws of the development and evolution of information technologies, and ensured coordination in pursing development and upholding security, taking firm steps toward building national strength in cyberspace. The network infrastructure has been improved by leaps and bounds, with the establishment of the world’s largest, technologically advanced fiber-optic broadband and mobile communication networks. All prefecture-level cities have been covered with fiber networks, with 93.4% of users enjoying an access rate of 100Mbps and above and over 50 million users enjoying gigabit access. China’s 4G base stations account for more than half of the world’s total and it has built 1.615 million 5G base stations, serving 413 million 5G mobile users. The strength of the ICT industry has been significantly enhanced. In terms of mobile communication technologies, China has achieved “breakthroughs in 3G”, “parallel progress in 4G” and “leadership in 5G”. 5G standard-essential patents account for 38.2% of the total and the gap between China and technologically leading countries has continued to be narrowed in 5G chips, operating systems for mobile devices and other core technologies in key fields. China has built the world’s largest and most complete industry ecosystem for optical communication, with optical communication equipment, optical module components, optical fibers and cables, and some other key technologies being internationally advanced. There are 301 unicorn companies in China’s Internet sector, or 25% of the world’s total. Internet applications such as e-commerce, e-government, mobile office, online education and video live streaming have been extensively popularized, greatly raising the efficiency of social operation. The annual transaction volume of mobile payment has reached RMB527 trillion and new economic forms have created over 20 million positions of flexible employment. The next generation of ICTs represented by 5G has seen accelerated adoption in many industries including industrial manufacturing, ports, mining, health care, education, culture and tourism, with a total of over 20,000 use cases. ICT inclusion and sharing have enabled high quality service at lower price and universal telecom services have been promoted in greater width and depth. For the first time in history, broadband access has been realized in all administrative villages across the country, the proportion of China’s primary and secondary schools (including teaching facilities) with network accessibility has increased from 25% to 100% and telemedicine has covered all counties lifted from poverty, proving strong support to win the battle against poverty. The “less fee for faster network” policy has been implemented in greater depth. The average download rate on broadband network has increased from 1.6Mbit per second to 62.5Mbit per second, roughly 40 times faster, while the average tariff per unit of mobile data has dropped by more than 95%. Number portability has been launched nationwide, with an accumulated number of users exceeding 61 million. Faster progress has been achieved in the transformation of Internet applications for better age-friendliness and information accessibility so that the elderly, the disabled and other groups with special needs can also share the benefits of ICT development. The “Travel History Record” service has supported nearly 60 billion inquiries for free, securing routinized epidemic prevention and control and the smooth mobility of the general public. The capability in guaranteeing emergency communication has been continuously strengthened, successfully supporting major events with communication guarantee, while the capabilities in flood and drought control, disaster relief and emergency response have continued to be improved. Major public concerns and headaches, such as the pop-ups “that can’t be blocked”, the “Open in App” pop-ups, and unwanted software download, have been effectively addressed for correction. More than 99% of unwanted calls have been effectively reported and addressed in a timely manner, and the number of user complaints about spam SMS has dropped to a record-low level. The data security management system has taken shape in the field of industry and information technology, and the security guarantee system has been primarily established for the industrial Internet and other new facilities, rapidly improving the comprehensive strength of the cyber security industry.
6. All market entities have been fully energized while the comprehensive strength and competitiveness of Chinese enterprises have been remarkably enhanced
General Secretary Xi Jinping has prioritized the need to speed up the efforts to nurture a number of world-class enterprises with excellent products and brand imaging, leadership in innovation and modern governance; China’s SMEs are full of inspiration and vitality, and can do great things. Therefore, it is necessary to strengthen support for SMEs in innovation and promote the development of “professional, specialized and innovative” SMEs. The MIIT works unswervingly to both consolidate and develop the public sector, and encourage, support and guide the development of the non-public sector. We have both pushed ahead with comprehensive reform and improved policies and environment to protect and stimulate the vitality of enterprises and significantly improve their comprehensive strength and competitiveness. From 2012 to 2021, the total assets and operating revenue of China’s top 500 manufacturing enterprises had increased from RMB19.7 trillion and RMB21.7 trillion to RMB44.33 trillion and RMB40.24 trillion respectively. The SMEs have continuously enhanced their comprehensive strength, core competitiveness and capabilities in fulfilling social responsibilities. By the end of 2021, the number of market entities nationwide reached 150 million, or 2.8 times more as compared with 2012. Among them, 48.423 million were enterprises, an increase by 1.7 times, with more than 99% being SMEs; the number of industrial SMEs above designated size reached 401,000, with a total operating revenue of RMB75.5 trillion, total profit of RMB4.7 trillion and total assets of RMB77.3 trillion, an increase of 23.5%, 38.7%, 37.1% and 101.5% respectively over 2012. In 2021, the total number of privately employed individuals in China was 400 million, 200 million more than that of 2012. According to the data of the fourth national economic census, the SMEs employed 80% of the total workforce in enterprises. Private enterprises, mainly MSMEs, became China’s largest market entity in foreign trade in 2019. In 2021, their import and export value accounted for 48.6% of the total, with a contribution to foreign trade growth exceeding 58.2%. In 2020, the R&D expenditure of industrial enterprises above designated size reached RMB1.53 trillion, or 2.55 times of 2012, with investment intensity up from 0.71% to 1.41%. The number of industrial enterprises with R&D activities increased from 47,000 in 2012 to 147,000 in 2020, or from a proportion of 13.7% to 36.7%. Up to now, the MIIT has nurtured 4,762 national-level “little giant” enterprises and 848 national-level manufacturing champions in specific market segments, mobilizing local governments to nurture over 40,000 provincial-level “professional, specialized and innovative” SMEs and register more than 110,000 potential enterprises for future nurturing programs. The average R&D intensity of champion enterprises in specific market segments and the “little giants” was 5% and 7% respectively, which was 5 times and 7 times higher than the average of industrial enterprises above designated size, acting as important guarantee to raise economic vitality in innovation and solidify the resilience and competitiveness of China’s industrial chain and supply chain.
