Felipe Augusto Machado

China’s Fifth Plenum decision is out. Beijing wants the Party to have more influence in private tech firms. “Strengthen Party-building efforts in platform companies, technology-innovation enterprises, and other such firms; establish a mechanism for dynamically adjusting the elevation of Party organizations within internet companies to higher administrative levels of management; and ensure that responsibilities for Party-building are fulfilled.”

Why is China so obsessed with holding on to traditional industries? Aren’t they focused on high-tech growth? Key reasons as laid out by NDRC: 1. They’re the foundation of the “real economy” and enable new high-tech industries. 2. Traditional industries may have started earlier but innovation and progress in them continues. 3. Employment—they can provide high-quality jobs through industrial upgrading. Quote from a Q&A with reporters: Reporter from Singapore’s Lianhe Zaobao: Amid the wave of high-tech development, how can China’s traditional industries transform themselves while continuing to create jobs? Fu Jiuling, Director-General of the Department of Industrial Development, National Development and Reform Commission (NDRC): The Outline of the 15th Five-Year Plan lays out a blueprint for industrial development over the next five years, and it has attracted a great deal of attention. When we talk about technological revolutions and industrial transformation, it is easy to think of emerging industries and industries of the future while overlooking traditional industries. Some even believe that cultivating new growth drivers means traditional industries are no longer important. At the same time, many people are concerned about the impact of industrial upgrading on employment. I would like to make three points. First, the transformation of traditional industries toward newer and higher-quality development has always been underway and has never stopped. We often say that each generation of manufacturing processes, materials, and equipment represents a new stage of technological iteration and industrial upgrading. Experience shows that there are only outdated products, not outdated industries. Although traditional industries have been around for a long time, they should not be equated with low-end or backward industries. Consider people’s everyday needs for clothing, food, housing, and transportation. Today’s clothing fabrics are incomparably better than those of the past. Bicycles are also becoming lighter, with some now incorporating carbon fiber. It is fair to say that the so-called traditional industries we see today are very different from what they were several decades ago, or even just a few years ago. The vitality of traditional industries—like old trees sprouting new shoots—is evident everywhere in our daily lives. Second, traditional industries are the foundation of the real economy, and all three of China’s “new three” industries have emerged from traditional industries. For example, although the three core systems of new energy vehicles—batteries, electric motors, and electronic controls—have replaced the conventional internal combustion engine powertrain, the manufacturing processes used to produce vehicles remain fundamentally continuous with those of traditional gasoline-powered cars. The solar photovoltaic industry originated in polysilicon, which belongs to the nonferrous metals industry. The subsequent production of silicon wafers, solar cells, and modules all relies on mature processes from the electronics industry. Lithium-ion batteries originated in traditional electrochemistry and materials manufacturing. These industries did not emerge out of thin air. They were built on the strong foundations of traditional industries and sustained technological innovation. Third, we must proactively understand and respond to the impact of new technological developments on employment. Looking at manufacturing, during the 14th Five-Year Plan period, employment rose in some industries and fell in others, but overall manufacturing employment remained stable at around 110 million people. Throughout human history, new technologies have continuously affected employment. The replacement of physical labor by machinery and equipment, and of certain forms of cognitive labor by information technology, has been an ongoing process. We can see this in our daily lives. Some jobs are disappearing, while new …

“China is becoming a factory for factories. No longer just a producer of low-value consumer goods, China is now exporting more of the higher-value intermediate and capital goods that underpin global manufacturing, such as chips, precision machinery and robotic arms.” @hannahmiao_ wsj.com/economy/trade/chinas…