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Made in China vs. assembled in China [Copy link] 中文

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Post time 2016-3-7 16:15:50 |Display all floors

Made in China vs. assembled in China

China’s long-awaited and indigenously designed passenger plane C919 is about to make a maiden flight some time this year. Except for one minor drawback, the plane looks quite impressive on its performance as well as on appearance. And what is this minor drawback? It is not 100% Chinese. Except for fuselage and wings and tail and some frame structures, plane’s key components including electronics, engines, and even landing gears, have to rely on foreign sources. For example, C919’s powerful turbofan engines, the key to its performance, are supplied by an American company-- GE. Electronic equipments and landing gears came from various countries including UK and France andGermany. Though still pending for its certificate from international aviation organization, the newly-designed jets are said to have so far been booked up to a few hundreds by airlines worldwide. But further investigations reveal that most of the customers are no other than domestic airlines owned and operated by Chinese government. In other words, China turns out to be the major client for its homemade jets.

China’s airplane industry operates in the similar way to its other industries such as car and cell phone, and computer. What China does best is to either import or manufacture under license the key components and then put them together. In other words, the products that are supposed to be made inChina are in fact assembled in China using foreign parts. Though dubbed as “world’s second largest economy” (SLE), China remains as a bottom feeder in world’s supply chain. China’s multinational companies are in fact state-owned conglomerates that generate limited overseas sales and revenues. And virtually china has not a single internationally recognized brand name. Apart from low cost and cheap imitation, china lacks competitive advantages in brand names, marketing, logistics and technological innovations. As TPP (Trans pacific partnership) gradually comes into effect, China’s sole competitiveness, namely cheap labor cost, is being further diminished. The low-end and labor-intensive jobs are being quickly shipped out to Southeastern Asian countries where labor costs are much cheaper than those in China. In the meanwhile, in the high-end fields,China has not much to offer except for some cheap imitations and assembling works. The core ofChina’s problem is the lack of ability to move the country up in the world supply chain. So long as China refuses to mend the fatal flaws associated with its state-run capitalism, the chances ofChina ever becoming an advanced economy are rather slim.

The other day Premier Li Ke-qiang publicly acknowledged china’s lack of technological caliber. In a bitter tone, Li admitted china’s actual industrial caliber in many fields is in fact extremely limited. And he was shocked to learn that until this day china has to rely on foreign sources for key components including tool steel, cable for crane, computer chips, alloys, and even the tiny balls for ballpoint-pens. For decades, China’s growth model places great emphasis on speed and quantity while ignoring quality. And economic data and statistics are often manipulated to suit for the need of the government. As both real-estate and export gradually die away china’s economy has finally reached to a turning point.

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Post time 2017-8-12 22:43:23 |Display all floors
Well written article.

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