A robot assisted by power personnel makes a snowy inspection of a substation in Taizhou, Jiangsu province, China, December 18, 2023.
MERICS China Industries
15 min read

New roadmap for future industries + Data as a factor of production + Auto chips

In the latest issue of MERICS China Industries, Alexander Brown, Jeroen Groenewegen-Lau and Antonia Hmaidi look at the following topics:

  1. China seeks first-mover advantage with roadmap for future industries   
  2. China wants to leverage the multiplying effects of data to grow its economy
  3. Ambitious standards for auto chips could support indigenization efforts and hurt foreign incumbents
  4. MIIT charts course for leadership in green shipbuilding by 2025
  5. The mid-term report: China falls short on 14th Five-Year-Plan environmental goals

1. China seeks first-mover advantage with roadmap for future industries

At a glance: The Ministry of Industry and Information Technology (MIIT) and six other agencies released a blueprint for the development of future industries. It calls for the development of innovative products related to humanoid robots, quantum computers, advanced visual displays, brain-computer interfaces, 6G equipment, ultra-large smart data centers, third-generation internet, aviation and resource exploration. Overall goals include: 

  • By 2025, set up future industry incubators and pilot zones, generate breakthroughs in 100 advanced key and core technologies, launch 100 innovative products, build 100 leading enterprises, set 100 key standards and cultivate 100 professional organizations.
  • By 2027, generate major breakthroughs in key and core technologies, nurture a batch of world-leading enterprises, and build a development landscape that links up future industries with advantageous, emerging and traditional industries.

MERICS comment: The plan is part of China’s response to the tech war with the US. Implementing the 14th Five-Year Plan, it aims to reduce reliance on foreign technology and to generate strengths for China in new technology areas. The crux to developing future technologies is in the coordination between researchers and industry, as many of these technologies are currently only theoretical or lab-tested. Seeking to overcome the gap that traditionally exists in China between research and industry, the plan calls on national key labs to develop the needed technology, and on leading enterprises to form innovation consortia with a broad range of stakeholders. The plan also explicitly links up with other policies that address the same gap, such as those on manufacturing pilots, advanced manufacturing clusters, Little Giants, the science and technology (S&T) progress law, patents and standards. These efforts are supported through funds for upgrading manufacturing, developing SMEs and a new fund for integrating S&T-industry-finance.

Foreign firms operating in China may benefit from Beijing’s willingness to invest in innovation. The plan promotes international cooperation, by encouraging domestic firms and labs to participate in global networks, and foreign entities to establish research and development (R&D) facilities in China. Yet the calls for integration of resources and to fully domesticate supply chains could make it increasingly difficult for entities which are not based in China to participate. More generally, foreign entities are at risk of getting caught up in the national security framework.

Article: Implementation Opinions on Promoting Innovative Development of Future Industries (关于推动未来产业创新发展的实施意见 ) (Link)
Issuing bodies: MIIT, MOE, MOST, MOT, MCT, SASAC, CAS 
Date: January 29, 2024

2. China wants to leverage the multiplying effects of data to grow its economy

At a glance: Seventeen government agencies led by the National Data Administration (NDA) have unveiled a three-year action plan to leverage the “multiplying effects” of data as a factor of production in economic development. The plan focuses on data application, data circulation and data security, and promotes integration in 12 areas ranging from technology to the low-carbon transition. The major objectives by 2026 include:

  • Form a comprehensive industrial ecosystem for data, covering all aspects from enhanced data quality to deeper synchronization between data exchanges
  • Develop demonstrations for more than 300 typical application scenarios such as smart manufacturing and emergency management
  • Achieve an average annual growth rate of at least 20 percent for the data industry
  • Cultivate a group of data vendors, third-party service organizations and exemplary localities with strong innovation capacity and high-quality growth