Made in China 2035: will it topple US hi-tech, military manufacturing in 10 years?
‘Irreversible’ US production declines amid an expanding Chinese economy will thrust world into ‘a new era’, says government adviser Lu Yongxiang
China will overtake the United States in hi-tech and advanced military manufacturing within a decade, according to a prominent Chinese strategist.
“Overall, the decline of the US manufacturing industry and its weakened competitiveness in the global market have become an irreversible trend,” said Lu Yongxiang, former vice-chairman of the National People’s Congress, in a commentary published in the Chinese Journal of Mechanical Engineering on September 9.
Lu, who is also former president of the Chinese Academy of Sciences, is known for his foresight as a mechanical engineer, and has been influential in helping to shape the Chinese government’s long-term development strategies.
While the US has maintained its lead in hi-tech and advanced military equipment production, its advantages are rapidly diminishing, according to Lu.
“It is estimated that by 2035, ‘Made in China’ will surpass the United States and become the global leader,” Lu said in the article.
Lu also predicted that China’s economy will be larger than America’s by that time. “The world will enter a new era,” he added.
In 2010, China’s manufacturing output surpassed the US according to the Chinese government, which cited statistics from the World Bank. However, Chinese factories lagged significantly in terms of technology and product quality. In 2015, Beijing launched a 10-year plan to narrow the gap, and this plan is expected to be renewed every decade.
However, “Made in China 2025” has since drawn significant responses from Washington and its allies.
Among them, the rise of high-end industries – such as shipbuilding, electric vehicles, drones, renewable energy, and industrial robots – has been much faster than expected, leaving behind competitors in the United States and other developed countries.
Last year, Chinese shipyards secured orders to build more than 1,500 large ships worldwide, while only five orders went to the US.
China contributed about one-third of the total global manufacturing output last year, roughly double that of the US.
Still, China’s manufacturing sector lags behind the US in some advanced fields, especially in advanced weapons production, according to Lu.
“Lockheed Martin’s pulse line in the United States maintains an annual assembly capacity of only 12 aircraft, but during wartime, relying on global supply chain collaboration, it can produce one aircraft every two days,” he wrote.
China has now produced more than 200 J-20 stealth fighters, surpassing the number of F-22s made by the US, but far fewer than the more than 1,000 F-35s that have been made.
China has produced only two operational aircraft carriers, while the US has 11.
According to US media reports, some senior American military officers say that a war between China and the United States could break out as early as next year.
China, meanwhile, is undergoing a painful economic transformation, with traditional industries such as real estate, retail and fossil fuel-powered car manufacturing shrinking, resulting in significant job losses. The average output measured by value of a Chinese worker is also significantly lower than the average American worker.
“We must turn the crisis into opportunities,” Lu wrote.
A long-term advantage of China’s manufacturing sector was in technological innovation, he said.
“China’s research and development intensity has reached 2.64 per cent [of GDP], surpassing the average level of [European Union] countries,” he wrote.
Advanced infrastructure also helps create an excellent environment for investment in manufacturing.
“Furthermore, China is also at the forefront in the construction of gigabit-level optical cables and 5G broadband wireless communication networks,” Lu said.
“China not only possesses a vast pool of innovative human resources but also the world’s largest and rapidly growing domestic market for manufacturing. This makes China an irresistible attraction for global innovative talent and international capital.”
China’s average life expectancy is now 78.6 years, while the US sits at 77.5 years, according to government data.
“A nationwide health and epidemic prevention network, a healthcare database, and advanced facilities for medical research and clinical medicine covering a population of 1.4 billion provide a solid scientific and technological basis for national health,” Lu said.
The cause of the decline in US manufacturing lies in strategic misdirection, a lesson that Lu said was worth learning.
“In the global division of the manufacturing industry chain, the United States has transferred labour-intensive, low value-added manufacturing to developing countries, while focusing on retaining hi-tech research and development and vigorously developing virtual economies such as stocks, securities and financial investments,” he wrote.
“However, due to excessive financial bubbles, constant provocation of international conflicts, and intense partisan strife within the country, the US manufacturing industry is accelerating its shift from the real to the virtual economy.
“The ageing of infrastructure in the United States, coupled with the declining attractiveness of manufacturing to the younger generation, has also accelerated the continuous decline of US manufacturing.”
Both candidates in the US presidential race have made revitalising the manufacturing industry one of their top priorities.
US Vice-President and Democratic candidate Kamala Harris said she would boost investment in hi-tech industries such as chips and aerospace.
The Republican contender, former US president Donald Trump, promised radical measures to bring manufacturing jobs back to the country.
During a campaign speech last Wednesday in Savannah, Georgia – a vehicle manufacturing hub and home to one of the country’s largest ports – Trump said a vote for him would result in a “mass exodus” of manufacturing from US allies South Korea and Germany, as well as economic rival China.
“We will take other countries’ jobs. We’re going to take their factories,” he said.