(Source: https://pltfrm.com.cn)
The Chinese government’s “Made in China 2025” policy, launched in 2015, is a strategic plan to transform China into a leading manufacturing power by advancing technology and innovation in key industries. This policy has several implications for foreign businesses operating in or with China:
- Increased Competition in High-Tech Industries: The policy focuses on elevating domestic industries in areas such as electric cars, next-generation IT, telecommunications, robotics, artificial intelligence, green energy and vehicles, aerospace, new materials, and biomedicine. Foreign companies in these sectors may face heightened competition from Chinese companies, especially those that receive government support.
- Market Access Challenges: There may be increased barriers for foreign firms in the targeted sectors. The Chinese government might favor domestic companies through subsidies, preferential loans, and procurement policies, potentially making it harder for foreign businesses to compete in the Chinese market.
- Intellectual Property Risks: The policy’s emphasis on innovation and technological advancement could raise concerns about intellectual property (IP) rights and technology transfer. Foreign companies might face pressure to share technology in exchange for market access, raising IP security concerns.
- Opportunities for Foreign Technology and Expertise: On the flip side, the policy can also create opportunities for foreign businesses that offer advanced technology and expertise that Chinese companies need to achieve their “Made in China 2025” goals. Partnerships, joint ventures, and other forms of collaboration could be beneficial.
- Supply Chain Shifts: As Chinese manufacturing moves up the value chain, foreign businesses might need to reassess their supply chain strategies. This could involve finding new suppliers or adjusting to changes in pricing and quality from existing Chinese suppliers.
- Regulatory Environment Changes: The policy may lead to changes in the regulatory environment, affecting areas like market entry, foreign investment restrictions, and taxation. Foreign companies need to stay informed and adaptable to these changes.
- Increased Scrutiny in Global Markets: There might be increased scrutiny and potential backlash against Chinese companies in international markets, especially in high-tech sectors. This could affect joint ventures and partnerships between foreign and Chinese companies.
- Need for Technological Advancement: To remain competitive, foreign companies might need to accelerate their own research and development efforts and invest in technological advancements.
- Shift in China’s Labor Market: As China moves towards high-tech manufacturing, the labor market may shift, affecting labor availability and costs. This could influence foreign businesses that rely on Chinese manufacturing and labor.
- Global Trade Dynamics: The policy can influence global trade dynamics, potentially leading to trade tensions or realignments as countries react to China’s growing technological capabilities.
In summary, “Made in China 2025” presents both challenges and opportunities for foreign businesses. It’s important for these businesses to closely monitor policy developments, adapt their strategies accordingly, and consider new forms of engagement and competition in the Chinese market.
PLTFRM is an international brand consulting agency that works with companies such as Red, Tiktok, Tmall, Baidu, and other well-known Chinese internet e-commerce platforms. We have been working with Chile Cherries for many years, reaching Chinese consumers in depth through different platforms and realizing that Chile Cherries exports in China account for 97% of the total exports in Asia. Contact us and we will help you find the best China e-commerce platform for you. Search pltfrm for a free consultation!
