Global industry and supply chain stability must be ensured

By Ren Hongbin
0 Comment(s)Print E-mail, November 21, 2023
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Chairman Ren Hongbin of the CCPIT. [File photo]

The central leadership of China attaches great importance to maintaining the stability and smooth operation of the global industrial chain and supply chain. It has repeatedly emphasized that China will deepen international cooperation in these areas through concrete actions. 

On May 18, 2022, President Xi Jinping, in his speech marking the 70th anniversary of the China Council for the Promotion of International Trade (CCPIT) and the Global Trade and Investment Promotion Summit, noted, "The CCPIT should maintain the security and stability of the global industrial chain and supply chain, expand the scope of cooperation, and ensure that the fruits of development benefit people worldwide."

President Xi's series of new ideas, proposals, and initiatives reflect the strategic vision and broad perspective of a leader of a major political party and country. They also demonstrate China's commitment to promoting global openness and cooperation.

To fully implement the spirit of President Xi's important speech, the CCPIT will host the first China International Supply Chain Expo (CISCE) in Beijing from Nov. 28 to Dec. 2. This event aims to foster international cooperation in the industrial chain and supply chain, contributing to the all-round building of a modern socialist country and a global community of shared future.

The global industry and supply chains are intricately interconnected, with all countries participating in the global cooperation chain. Currently, these global systems face threats. Concurrently, a new phase of scientific and technological revolution and industrial transformation is advancing, leading to profound adjustments in the global innovation landscape and economic structure.

With deep insight into the general trend of international and domestic industrial development, President Xi has emphasized that "maintaining the resilience and stability of the global industrial chain and supply chain is an important guarantee for promoting global economic development." He also noted, "The global industrial system and the global industry and supply chains are experiencing a diversified layout, regional cooperation, green transformation, and accelerated digitalization." Furthermore, he expressed China's willingness to work with other countries to seize new opportunities arising from the ongoing scientific and technological revolution and industrial transformation, working together to establish a global industry and supply chain system that is secure, stable, unobstructed, efficient, open, inclusive, and mutually beneficial.

President Xi's series of important discussions have elevated the understanding of the public goods nature of industry and supply chains to a higher level. They have also provided clear direction and a path for maintaining the stability and smooth operation of global industry and supply chains. These discussions have injected strong momentum into the construction of a more equitable, inclusive, and constructive partnership in industry and supply chains.

The report to the 20th National Congress of the Communist Party of China (CPC) proposed that the country should prioritize improving the resilience and safety of industry and supply chains. This entails strengthening international macro policy coordination for industrial and supply chains, placing greater emphasis on enhancing the resilience and competitiveness of the industry chain, accelerating the development of a modern industrial system, and striving to establish an independent, controllable, safe and efficient industry and supply chain.

The CCPIT will be guided by the principles outlined in President Xi's important instructions. It will conduct in-depth studies and implement the guiding principles of the 20th CPC National Congress. The focus will be on maintaining the stability of global industry and supply chains, aiming for greater achievements in promoting high-quality development, building a new development pattern, and promoting the construction of an open world economy.

China is firmly committed to maintaining the public goods nature of industry and supply chains. It has demonstrated its responsibility as a major country in maintaining the stability and smooth operation of global industry and supply chains. China serves not only as a beneficiary and defender of the integrated development of the global supply chain but also as an active explorer and builder of a new global supply chain system. The crucial role of global manufacturing and supply chains continues to be prominent.

China needs to continuously improve its industrial system to provide strong support for the operation of the global industry and supply chains. China has the most complete industrial categories and the most comprehensive supporting system according to United Nations standards. The rise of China's high-end industries, such as electronic and electrical equipment, in the global division of labor is accelerating. The development of China's new energy industries, such as photovoltaics, is leading the world. Additionally, China is the first country to achieve large-scale application of 5G mobile communication technology. The scale of China's manufacturing industry has ranked first in the world for 13 consecutive years, accounting for nearly 30% of the global share, making China the "world's factory" in the global supply chain.

Based on its large market size, China is committed to providing ample space for the operation of the global industry and supply chains. The scarcest resource in the world today is the market, and the size of the market determines the depth of division of labor, which in turn determines the level of industrial development. With a population of over 1.4 billion and a middle-income group of over 400 million, China is the world's second-largest consumer market.

Leveraging its large-scale market and domestic demand potential, the country actively expanded imports, and its total tariff level dropped to 7.3%, making it the world's second-largest importer for 14 consecutive years. More than 90% of foreign enterprises in China primarily produce for the Chinese market. In recent years, China has continuously relaxed its market access, optimized the business environment, and ranked second in the world in attracting foreign investment for five consecutive years, with its "magnetic attraction" for foreign investment constantly strengthening.

The deepening of international cooperation under the Belt and Road Initiative (BRI) framework provides important impetus to the operation of global industry and supply chains. Transitioning from a Chinese initiative to an international practice, the BRI has evolved into a well-received international public good and a platform for international cooperation. Over the past decade since the inception of the BRI, China and other countries have engaged in imports and exports valued at $19.1 trillion, with two-way investments surpassing $380 billion. A series of cooperative projects in agriculture, energy, the digital economy, and other sectors have effectively facilitated the upgrading of industrial structures and the optimization of industrial chains in various countries. A total of 79,900 China-Europe Express freight trains have reached more than 200 cities in 25 European countries, establishing a "golden channel" for stabilizing the global supply chain.

China actively participates in global economic governance and offers Chinese solutions for the operation of global industry and supply chains. As early as the 22nd APEC Economic Leaders' Meeting in 2014, President Xi proposed cooperation initiatives in the realm of global value chains and supply chains. Subsequently, he introduced relevant initiatives or statements in multilateral platforms such as the G20 and the Shanghai Cooperation Organization. In 2022, as China assumed the rotating presidency of BRICS, it encouraged BRICS countries to launch an initiative to strengthen supply chain cooperation. During the same year, China hosted the International Forum on Resilient and Stable Industrial and Supply Chains, jointly launching the initiative for international cooperation on resilient and stable industrial and supply chains with Indonesia and six other partner countries.

The CCPIT will spare no effort to successfully organize the first CISCE and provide international public goods and services that can be shared worldwide. Since its establishment in 1952, the CCPIT has played a significant role in expanding the interests of Chinese and foreign enterprises, promoting international economic and trade exchanges, and promoting the development of state-to-state relations. Currently, the CCPIT aims to strengthen its role in connecting government and enterprises, integrating domestic and foreign markets, and facilitating the smooth flow of supply and demand. The goal is to make the first CISCE a world-class expo, contribute to the construction of a resilient global industry and supply chain system, and support the recovery of the world economy and global development and prosperity. 

The CCPIT also aims to open a new window for high-level opening-up. The CISCE is the world's first national exhibition focused on supply chains, encompassing trade promotion, investment cooperation, innovation gathering, learning, and exchange functions. It vividly represents China's continuous efforts to create "greater market opportunities," "better alignment of rules," "greater innovation momentum," and "stronger inclusiveness and sharing."

The first CISCE will feature five major supply chain service exhibition areas, including intelligent automobile chains, green agriculture chains, clean energy chains, digital technology chains, and healthy life chains. It will also host the opening ceremony and the Global Supply Chain Innovation and Development Forum, along with six special forums and a series of supporting activities. The expo is expected to facilitate cooperation between Chinese and foreign enterprises across various links of industry and supply chains, enabling them to seize market opportunities, investment prospects, and growth potential.

The CCPIT aims to build a new platform for constructing services in the new development pattern. The first CISCE strives to create an open international cooperation platform that connects the upstream, midstream, and downstream sectors, integrates large, medium, and small enterprises, facilitates industry-university-research collaboration, and promotes application-oriented cooperation with both Chinese and foreign enterprises. From the perspective of serving the domestic cycle, the first CISCE will showcase China's level of scientific and technological innovation and industrial integration, encouraging global innovation elements to enter China. This will, in turn, foster intelligent, green, and integrated industry development and accelerate the construction of a modern industrial system. From the perspective of promoting the international cycle, the first CISCE will bring together new products, technologies, and services related to the supply chain, thereby promoting the global industrial division of labor, resource allocation, innovation cooperation, and the sharing of results. It will also contribute to maintaining the stability and smooth operation of the global industry and supply chains.

The CCPIT endeavors to create a new vehicle for building an open world economy. The first CISCE responds to the international business community's urgent desire to maintain stable and seamless industry and supply chains, focusing on promoting open cooperation and mutually beneficial outcomes. The number of international exhibitors has reached 26%, representing more than 50 countries and regions, with U.S. and European companies accounting for 36% of them. A significant presence of Fortune Global 500 enterprises, China's top 500 enterprises, China's top 500 private enterprises, and "specialized, special, and new" champion enterprises in their respective industries will participate in the exhibition, jointly illustrating the story of international cooperation in the industrial and supply chains. The CCPIT will release the Global Supply Chain Promotion Report, which will quantitatively analyze the development trends of the global supply chain and offer suggestions from the business community to promote technological innovation, open cooperation, connectivity, and inclusive development of the global supply chain.

The CCPIT aims to create new practices to implement the concept of a global community of shared future. The first CISCE serves as a new platform for exchange and cooperation, promoting the stability and smooth operation of the global industry and supply chains. The theme, "Connecting the World for a Shared Future," and the principle of "Joint Contribution, Extensive Promotion, and Shared Benefits," align with the concept of a global community of shared future. Supported by organizations such as the United Nations Conference on Trade and Development, the United Nations Industrial Development Organization, the World Intellectual Property Organization, the International Trade Centre, and the International Chamber of Commerce, the CCPIT facilitates the participation of underdeveloped countries and supports their integration into the global value chain. Additionally, the Beijing Initiative on Global Industrial and Supply Chain Connectivity will be released. It is hoped that business communities of all countries will meet halfway and achieve mutual success on this major stage, contributing to the deepening of economic globalization and ensuring that win-win cooperation benefits the world.

The author is the head of the China Council for the Promotion of International Trade. This is a translation of Ren's signed article published by People's Daily on Nov. 20.

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