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Intelligent Manufacturing Reshapes China's Industrial Upgrading

01 January 2017tag:Author: Yuan Associates

Intelligent Manufacturing will be playing a decisive role in China’s ambitious blueprint and landmark policy, Made in China 2025, to transform China from a manufacturing giant into a leading global manufacturing power and address its traditional industries’ most pressing needs of upgrading their development models into smart and advanced ones.


In the context of Chinese Manufacturing’s current co-existing situations regarding Industrialization 1.0 (mechanization), 2.0 (automation), 3.0 (digitalization), and 4.0 (intelligitization), diversified and leap-forward upgrading will definitely be taking place across industries and regions, which will provide MNCs with increased opportunities to share their best practices and become go-to companies while governments select cooperation partners.


Furthermore, to encourage MNCs’ involvement in China’s execution of key policy initiatives, last month the central government purposely reassured via a national press conference held by the State Council that all foreign-invested enterprises will undoubtedly enjoy national treatment for relevant incentives, including:

• Central incentives: Mainly coming from the Industrial Upgrading Sub-Fund for the Made in China 2025 policy. The amount allocated is generally quite large, ranging from RMB 10-100 million.
• Local incentives: Most economic well-developed provinces offer intelligent manufacturing incentives. For example, Guangdong already initiated their own incentive policy, which is exclusively prepared for the development of local intelligent manufacturing.


Therefore, in reaction to the aforementioned governmental initiatives, especially the newly-issued Five-Year Plan with a premium on benchmarking enterprises/pilots selection, multinationals need to increasingly assess the major impacts and be properly hedged to retain competitive advantages by reshuffling engagement priorities onto key stakeholders like the Ministry of Industry and Information Technology (MIIT) and its local bureaus nationwide. Also, we believe that only fully-allocated corporate resources and better scenario-planned engagements can help us outperform our competitors in the upcoming races for governmental support/financial incentives and reputation-building at the national as well as local level.

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