By Zhuo Xian, Research Department of Development Strategies and Regional Economy, DRC

Research Report, No.161, 2020 (Total 5905) 2020-6-29

Abstract: China’s industrial and supply chains are highly integrated with the global production network. In the context of China-US economic and trade frictions and the outbreak of COVID-19 epidemic, China’s manufacturing industry is faced with the risk of the disruption of supply, demand and technology chains in the short run. In the medium to long run, the sluggish globalization drive caused by interwoven factors have led some developed countries to implement policies in violation of the principle of efficiency and the laws of industry. The global production network that has been expanding for many years will become inward convergence based on regionalization, nearshore and localization. The global industrial and supply chain reconstruction has shown rapid and sudden changes. Therefore, China’s industrial chain may have to face transformation and probably in a swift manner before getting strong and robust. The key to safeguarding the industrial and supply chain lies in enhancing the resilience. We need to ensure the stability of the industrial chain by increasing the demand of domestic market, tighten the control of the industrial chain bolstered by local competent companies, enhance the resilience of the industrial chain by cultivating companies with potential growth capacity, and improve the collaboration of the industrial chain by perfecting the business environment.

Keywords: manufacturing industry, industrial chain, supply chain