In 2025, the year of the conclusion of China’s “Made in China 2025” program, and also the year of Donald Trump being re-elected as the President of the United States, the tension in the trade war and tech competition between China and the US is likely to escalate. This program has raised concerns among countries like the US and Europe about China’s unfair competition practices.
Economists and analysts generally believe that “Made in China 2025” aims to seize market share by disrupting the international trade order, representing a very malicious form of competition. The so-called “successful areas” actually do not involve high technological content; they can be achieved as long as there is enough money. The key technical components still rely on other countries, especially for high-end chips; without chips, sustainable industrial development is just a facade.
According to a report by Voice of America on the 14th, “Made in China 2025” ignited the US-China trade war in 2018. The Trump administration made countering “Made in China 2025” a top priority by implementing Section 301 actions against the Chinese Communist Party (including imposing tariffs), accusing China of intervening in the market’s normal operations in technology transfer, intellectual property, and innovation, disrupting fair competition.
Senator Marco Rubio, who is set to become Secretary of State 2.0 under Trump, released an evaluation report on the progress of “Made in China 2025” in September this year.
The report states that the outlook on China’s economic prospects is polarized, with some believing that China is facing problems such as high debt, slowing growth, aging population, and a sluggish real estate market, suggesting that the Chinese economy is on the brink of collapse; while others believe that China is dominating crucial high-tech industries for the future.
In evaluating “Made in China 2025,” Professor Fang Jiazhong from the Economics Department of National Taiwan University told the Epoch Times that throughout the entire industry promotion process, the CCP is seizing market share by disrupting the international trade order in its competition with opponents. It is not about improving quality or services, but instead, pushing prices below costs, using money-losing tactics to make opponents also lose money.
“But with its abundant financial resources and state support, it makes sure opponents can’t survive until they collapse, then it returns to seize market share. This is called predatory pricing. In the international environment, we call it dumping. In reality, it is a very malicious form of competition.”
Fang Jiazhong further mentioned that the CCP excessively and recklessly develops its enterprises through these means in these industries, seriously challenging the established business rules that all have followed.
“By defeating competitors, the CCP has built a tense international trade relationship, leading various countries to initiate trade wars to sanction you. Is this beneficial for China’s industrial development?”
Looking from any perspective, “Made in China 2025” leads to a failed outcome – its model and institutional design are flawed. The focus should not be on the success of one or two companies; that is not the point.
Rubio’s report notes that out of the ten key areas covered by the “Made in China 2025” plan, 4 have been “conquered” by China, including electric vehicles, energy and power generation, high-speed rail, and shipbuilding. 5 areas have achieved “partial goal completion,” which are aerospace, biotechnology, new materials, robotics and machine tools, and semiconductors. One area, agricultural machinery, has “completely missed the target.”
In response, Dr. Zhang Tianliang, Associate Professor in the Department of Humanities and Social Sciences at Feitian University, said in his YouTube program that a closer look at these four so-called “successful areas” identified by Rubio reveals that they actually do not involve high technological content; as long as you have money, you can produce them.
Regarding China’s aerospace and aviation sector, unmanned drone manufacturers occupy 90% of the US commercial market, Zhang Tianliang stated that China’s drones have indeed developed rapidly and achieved breakthroughs in aerospace aspects. However, China still cannot compete with SpaceX, Boeing, and Airbus.
Senior aviation expert Gao Fei told the Epoch Times that last year (2023), Shanghai Eastern Airlines’ C919 passenger plane could not return normally after flying from Shanghai to Chengdu and was substituted with an Airbus A320. The main reason was that “the C919 assembled parts from various countries globally; its composition, performance, maintenance assurances during the repair, and supply of components are all questionable.”
Zhang Tianliang stated that up to now, China’s domestically produced large aircraft C919 has not passed European and American safety certifications, so it cannot be sold to other countries. Even though domestic airlines use the C919 domestically, there are still many concerns for passengers.
Discussing China’s biotechnology, Zhang Tianliang acknowledged that Chinese companies are indeed researching new drugs and treatment methods but still heavily rely on Western capital and expertise. On new materials, there are hardly any outstanding achievements.
On robotics and machine tools, Zhang Tianliang said that while China’s production of low-end robots has gradually eroded international enterprises’ market share, the sophistication of robots is still far from enough compared to Tesla by Elon Musk, who essentially created a robot in the shape of a car.
In September this year, a report released by the official-funded Australian Strategic Policy Institute (ASPI) stated that China led 57 out of 64 advanced technology research fields between 2019 and 2023.
However, the report specifically noted that some analysts believe China’s significant progress is the result of heavy national investments made over the past 20 years. Despite the progress, Beijing still relies on other countries for critical technical components, lacking self-sufficiency, particularly for high-end chips.
Research fellow at the China Economic Research Institute Wang Guochen told the Epoch Times that without high-end chips, “Made in China 2025” is just empty talk. As most of China’s research is application-based, progress in fundamental research is very slow.
According to a report by The New York Times on December 16, the Biden administration may launch a trade investigation into mature semiconductor chips from China in the coming weeks, which might ultimately lead to tariffs on certain Chinese chips and products containing them, implementing import bans, or taking other actions.
Regarding Biden accelerating the crackdown on China’s semiconductor industry before leaving office, Wang Guochen said that it is evident that Beijing is actively acquiring global chips. Conversely, if its chip self-sufficiency rate reaches their so-called autonomous standard, there is no need to do so.
“In other words, in the past, Huawei claimed they had powerful chips or phones, but the fact is they still rely globally. So now, when everyone sees how advanced China’s mainland data algorithms are, or its digital economy or technology is advancing, if there are no AI chips or GPUs (graphics processing units), these are all empty.”
However, Wang Guochen believes that the Beijing authorities will stack up data to make “Made in China 2025” look like it has achieved its goals, or indeed has made progress in some areas. If you look at the quantity of data, it is indeed in line with China’s claims. But how many core patents and foundational research have they actually developed?
“In conclusion, China’s electric vehicles are impressive, indeed possessing numerous patents; however, when you disassemble them, many CPUs, chips, all of these are in the hands of the US. So, do you count this as a success?”