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‘Made in China’ Featured in Crisis Dialogue

May 29-2020   



The NSD and iFeng Finance, a news portal, have jointly held a live-streamed summit themed Global Economy and Policy Choice. ‘Made in China’ was one of the focal points featured in a dialogue between Prof. Yao Yang, Dean of the NSD, and Mrs. Dong Mingzhu, Chairwoman of Gree Group, a leading home appliance maker. They covered such issues as the quagmire inflicted by the pandemic, innovation in Chinese manufacturing, and division of work between the governments and enterprises, as well as China’s status in global manufacturing.

 

Mrs. Dong said that the pandemic has wrought unprecedented hardship, which is only starting to dissipate in May. To be precise, her company lost 30 billion yuan in revenue in the first quarter but has managed to log positive year-on-year growth in May. She believed it might be a blessing in disguise, as its 90,000 employees – mostly born in 1980s and 1990s - can learn to be more caring towards others and more responsible towards the society.

 

Prof. Yao reckoned that more entrepreneurs might be concerned with self-reliance in innovation due to the fear of foreign firms retreating from the Chinese market and possible disruptions to supply chains. However, he cautioned against the wishful thinking of asking the government to take charge of innovation. The way ahead, as has been demonstrated by over four decades of experiences, is to rely on private firms like Gree and many others to conduct market-based innovations. He debunked some myths and argued that innovations should be rooted in value creation and driven by market demand.

 

Regarding the division between the government and enterprises, Mrs. Dong said that government support is desirable for companies – not in the form of subsidies but of facilitation of bank loans when firms run into financial difficulties. The prerequisite, she emphasized, is that companies are to use the funding for building its own momentum. As the pandemic draws to an end, she said that the government should focus on two market issues: clamping down on fake products and doing things for the people.

 

Regarding the status quo of ‘Made in China’, Prof. Yao disapproved of the popular view that the Chinese manufacturing industry is large in size but not powerful enough. He argued that its sheer size – at 1/3 of global manufacturing – points to its power and creates network effects, including the full gamut of components and innovative prowess. He admitted that many products still lag in technological content compared to American ones, largely due to their different phases of development. In 30 years’ time, Chinese manufacturing shall catch up with its American counterpart, and therein will arise a question worthy of more deliberations: If Chinese manufacturing take up 40% of global total and is cheaper than that of other countries, how shall the rest of the world find their position?

‘Made in China’ Featured in Crisis Dialogue

May 29-2020   



The NSD and iFeng Finance, a news portal, have jointly held a live-streamed summit themed Global Economy and Policy Choice. ‘Made in China’ was one of the focal points featured in a dialogue between Prof. Yao Yang, Dean of the NSD, and Mrs. Dong Mingzhu, Chairwoman of Gree Group, a leading home appliance maker. They covered such issues as the quagmire inflicted by the pandemic, innovation in Chinese manufacturing, and division of work between the governments and enterprises, as well as China’s status in global manufacturing.

 

Mrs. Dong said that the pandemic has wrought unprecedented hardship, which is only starting to dissipate in May. To be precise, her company lost 30 billion yuan in revenue in the first quarter but has managed to log positive year-on-year growth in May. She believed it might be a blessing in disguise, as its 90,000 employees – mostly born in 1980s and 1990s - can learn to be more caring towards others and more responsible towards the society.

 

Prof. Yao reckoned that more entrepreneurs might be concerned with self-reliance in innovation due to the fear of foreign firms retreating from the Chinese market and possible disruptions to supply chains. However, he cautioned against the wishful thinking of asking the government to take charge of innovation. The way ahead, as has been demonstrated by over four decades of experiences, is to rely on private firms like Gree and many others to conduct market-based innovations. He debunked some myths and argued that innovations should be rooted in value creation and driven by market demand.

 

Regarding the division between the government and enterprises, Mrs. Dong said that government support is desirable for companies – not in the form of subsidies but of facilitation of bank loans when firms run into financial difficulties. The prerequisite, she emphasized, is that companies are to use the funding for building its own momentum. As the pandemic draws to an end, she said that the government should focus on two market issues: clamping down on fake products and doing things for the people.

 

Regarding the status quo of ‘Made in China’, Prof. Yao disapproved of the popular view that the Chinese manufacturing industry is large in size but not powerful enough. He argued that its sheer size – at 1/3 of global manufacturing – points to its power and creates network effects, including the full gamut of components and innovative prowess. He admitted that many products still lag in technological content compared to American ones, largely due to their different phases of development. In 30 years’ time, Chinese manufacturing shall catch up with its American counterpart, and therein will arise a question worthy of more deliberations: If Chinese manufacturing take up 40% of global total and is cheaper than that of other countries, how shall the rest of the world find their position?