Influenced by Germany’s industry 4.0, Premier Li has said “CM2025 will upgrade China from a manufacturer of quantity to a manufacturer of quality”. This is partly down to other emerging economies being able to manufacturer goods cheaper and also the weakening demand for exports from Europe/US. As a result of this it is of paramount importance that China reforms its industry by stepping into high-end manufacturing in order to position itself as a leader of global manufacturing. For the first time in two decades the workforce in China has decreased, whilst the labour costs rose. This in particular has impacted the Chinese economy slightly, along with the increasing competiton from ASEAN countries, as some companies have brought their manufacturing operations back to the US/Europe. China is still relatively weak in terms of innovation and core technologies – CM2025 aims to rectify this.

Made in China 2025 10 key focuses:

• Aviation & Aerospace
• Agricultural Technology
• Innovative Electronics
• New energy Automotive
• High-end Robots
• Next Gen Information Technology
• New Materials & Composites
• Rail Infrastructure
• Marine Technology
• Biomedical & Advanced Medical Equipment

CM2025 will provide both challenges and opportunities for FIE’s. It is clear in CM2025 that it is all about indiginous innovation and domestic development so it is quite obvios that there will be preferential treatment towards domestic firms over the FIE’s; in the form of subsidies, preferential treatment in court and more importantly the assimilation of Eastern to Western management practices making the domestic firms more competitive. FIE’s should be wary of things like that. On the other hand, an FIE can engage with the Chinese economy by doing a few things such as the exportation of high-end equipment, consultancy on things like international standards and collaborative R&D into new green energy sources that would help China reach its mandated environmentally friendly economic model.

Whilst it is evident that there are some challenges facing FIE’s, if an FIE can work in unison with the economic evolution taking place in China and help support it with it’s expertise in the field it has already mastered, China will be a very profitable place to be in business.

To read the full article, please click the link: http://www.eurobiz.com.cn/china-manufacturing-2025-internet-plus-whats-fies/. 
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