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Despite impressive growth over the past three decades, China is still on the low end of the global value chain for most industries, with processing exports accounting for approximately half of total exports, according to The Strategic Emerging Industries: A New Stage in Manufacturing in China, an analysis from the Manufacturers Alliance for Productivity and Innovation.
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The share of domestic value-added in exports is far below that of developed countries.
Report author Yingying Xu, economist for MAPI, notes that China's latest five-year plan focuses several industries that are fairly new even in global terms. The government plans to spend more than $300 billion over the next five years on developing and manufacturing biotech drugs, establishing biotech industrial centers, and strengthening intellectual property rights. The industry is expected to generate more than 1 million jobs and help China reach many social targets included in the plan, including extending life expectancy and reducing infant mortality.
China's new materials industry has a fairly low self-sufficiency rate, with the majority of domestic demand for high-tech new materials still relying on imports. The plan has set forth an average annual growth rate of more than 25 percent for the industry's output value over the next five years.
Other goals include establishing numerous well-equipped industry bases and industrial clusters, focuses on high-strength lightweight alloys, high-performance steel, functional film materials, new battery materials, carbon fiber composites, and rare earth functional materials.
Equipment manufacturing is the largest industrial sector in China, accounting for approximately one-quarter of total manufacturing output and dominating global markets in low-end products. By 2015, sales revenue for high-end manufacturing equipment is expected to reach more than $970 million and account for more than 30 percent of total sales revenue in the equipment industry.
Access the complete analysis of China's latest Five-Year Plan at mapi.net.