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China has the world’s most complete industrial system, with its manufacturing scale accounting for about 30% of the global total, ranking first in the world for 13 years in a row. The Central Economic Work Conference emphasized speeding up the construction of a modern industrial system when it laid out the work for 2023.

How to ensure that the industrial system is autonomous, controllable, safe and reliable, and ensure the smooth circulation of the national economy? How to enhance the status and competitiveness of traditional industries in the global division of labor? How to enhance the national strategic material reserve support capacity? Reporters interviewed the relevant ministries and commissions and a number of experts and scholars.

We will  strengthen chains to ensure that the industrial system is independent and controllable.

To build a modern industrial system, the key lies in revitalizing the manufacturing sector. Since 2022, China’s industrial chain in key areas such as major equipment, important basic parts and components, and new materials has reached a new level. In the first November of this year, the added value of the manufacturing industry increased by 3.3 percent year on year, further enhancing the resilience of industrial chain and supply chain.

According to the Central Economic Work Conference, focusing on key industrial chains of the manufacturing industry, weak links in key core technologies and components should be identified, and high-quality resources should be combined to tackle problems, so as to ensure that the industrial system is independent, controllable, safe and reliable, and smooth circulation of the national economy.

Jin Zhuanglong, Party chief and minister of the Ministry of Industry and Information Technology, said: “We will focus on self-reliance and self-improvement, coordinate development and security, forge long boards, strengthen weak links, strengthen the foundation, strengthen the transformation and upgrading of traditional industries, accelerate the cultivation and expansion of emerging industries, and comprehensively modernize the industrial system.”

Gather force “point on breakthrough”. “We should comprehensively sort out key core technologies that are vital to national economic security and national defense security, and accurately identify weak links that have been ‘stuck’.” Qiao Biao, vice president of CCID Research Institute, suggested that on this basis, comprehensive advantages such as complete industrial system, huge domestic market and strong mobilization and organization capacity should be made full use of to concentrate high-quality innovation factors and subjects, accelerate breakthroughs in the “bottleneck” point, and build an independent, controllable, safe and reliable production and supply system.

Strengthen “on-chain collaboration”. “More attention should be paid to breaking industrial barriers, unimpeded downstream circulation, synergies between industry, university and research, integrated development of large and small enterprises, coordinated interaction at home and abroad, and improved technological supply capacity of key industrial chains.” Fu Baozong, director of the Industry Office of the Institute of Industry of the Chinese Academy of Macroeconomic Research, proposed that in view of the weaknesses in major and basic fields, we should support the establishment of multi-participation technology research alliances dominated by key downstream users, and gather superior innovation resources to continuously carry out research and development. We will explore a more inclusive and relaxed incentive mechanism for weak links in competitive areas to encourage more innovative enterprises to take the risk.

Focus on “surface improvement”. Qiao Biao believes that, on the one hand, it is necessary to strengthen the overall planning of the industrial chain and supply chain, optimize the division of labor and distribution of the industrial chain according to the resource endowment and characteristic advantages of each region, and avoid the risks caused by excessive centralized deployment of the industrial chain. On the other hand, logistics and other infrastructure construction should be coordinated to strengthen infrastructure connectivity.

We will upgrade our development to be high-end, intelligent and green

Since 2022, more service platforms have joined hands with smes, adding impetus to the accelerated smart transformation. Statistics show that China has cultivated more than 1,700 industry-leading digital workshops or smart factories and more than 5,500 regional leaders.

Accelerating the transformation and upgrading of traditional industries is an important support for consolidating the foundation of the modern industrial system. The Central Economic Work Conference proposed to enhance the status and competitiveness of traditional industries in the global division of labor. Fu believes that to enhance the status and competitiveness of traditional industries in the global division of labor, we need to actively explore a new path of high-end, intelligent and green development.

Jump upmarket. “As consumption is increasingly upgraded, the new demand to meet high standards has become an important driving force leading industrial transformation.” Cheng Nan, director of the planning Institute of CCID Research Institute, said that this requires China to carry out quality revolution in traditional industries, guide the consumption concept of high quality and high price from the demand side, strictly control product quality standards from the supply side, and effectively improve the degree of consumer goods to meet people’s needs and intermediate products to support the modernization level of the industrial chain.

Upgrade to smart. “Faced with the advent of the digital economy era, traditional industries should be encouraged to actively use data analysis, cloud computing and other means to deploy more real-time and accurate production strategies.” Cheng Nan proposed that by transforming industrial assembly lines into customized production, personalized production and distributed production, and transforming production units into learning-oriented factories, digital factories and network chemical plants, the manufacturing industry can improve quality, reduce cost and increase efficiency.

Go green. Cheng Nan said that traditional industries should be guided to establish a green value orientation as soon as possible, with the help of automatic control, human-computer interaction and circular development, to realize the green of the whole life cycle from source design to production and manufacturing to sales and use, with the lowest consumption of resources to create maximum social wealth, and constantly stand out in the global industrial competition.

At the same time, we need to foster and strengthen strategic emerging industries, create new driving forces for development, and build new engines for the modern industrial system. The Central Economic Work Conference called for accelerating research and development, application and promotion of cutting-edge technologies such as new energy, artificial intelligence, biological manufacturing, green and low-carbon, and quantum computing.

To foster and strengthen strategic emerging industries, we need to better serve and integrate them into the new development pattern. Fu Baozong suggested that we should give play to the demand-leading role, actively expand the market space, take advantage of China’s super-large market advantages and innovation resources, explore to enrich and expand the application scenarios of strategic emerging industries, and accelerate industrial scale expansion and technology iteration.

To foster and strengthen strategic emerging industries, we need to open up at a higher level. Cheng Nan proposed to make good use of industrial advantages and influence, actively integrate into international industrial cycle, vigorously introduce high-end manufacturing and producer services represented by advanced technologies, introduce foreign advanced talents and management experience, and deepen the close links with the global industrial chain.

Jin said a special action will be carried out this year to cultivate a number of advanced manufacturing clusters with their own characteristics, complementary advantages and reasonable structure in key areas. We will study and formulate an action plan for future industrial development, and accelerate the planning and layout of future industries such as humanoid robots, meta-universe and quantum technology.

We will accelerate the planning and development of a new energy system

The annual natural gas production of petrochina Changqing Oilfield has exceeded 50 billion cubic meters, and China has built its first super large gas producing area with an annual output of 50 billion cubic meters. The Baihetan to Zhejiang ultra high voltage project is completed and put into operation, and can transport over 30 billion kilowatt-hours of electricity every year… By the end of 2022, there was a steady stream of good news on major energy projects.

At the Central Economic Work Conference, it was proposed to “strengthen domestic exploration and development of important energy and mineral resources, increase storage and production” and “enhance the capacity to ensure national strategic material reserves”. “It is of great significance to accelerate the building of a modern industrial system and better balance development and security.” Guo Jiaofeng, a researcher at the Institute of Resources and Environmental Policy of the Development Research Center of The State Council, analyzed that, from the perspective of development, to accelerate the construction of a modern industrial system, it is inevitable to accelerate the expansion of strategic emerging industries such as high-end equipment, new energy vehicles and aerospace, which requires a large number of important energy and mineral resources such as oil and gas, copper, aluminum, lithium and manganese as support. Strengthening domestic exploration and development of important energy and mineral resources and increasing storage and production will help strengthen our ability to cope with risks and ensure the stability of industrial and supply chains.

Guo Jiaofeng believes that the next step is to continue to increase investment, especially investment in scientific and technological innovation, to promote innovation elements to the integration of “production, university, research and application” and the agglomeration of leading technology enterprises, and to accelerate the research in the “bottleneck” technology, unconventional resources exploration and development technology and other aspects. In order to improve the ability to secure national strategic material reserves, he suggested that more attention should be paid to mechanism innovation, improve the reserve mechanism that combines central and local governments, physical goods and production capacity, and government and enterprise reserves, improve the market regulation mechanism for strategic reserves, enhance the capacity to reserve and regulate commodities, and enhance the ability to respond quickly and guarantee.

The Central Economic Work Conference proposed accelerating the planning and construction of a new energy system. “The clean, low-carbon, safe and efficient construction of the energy sector has achieved remarkable results, but it also faces many challenges. For example, the dependence on foreign energy is still high, the energy consumption structure is still dominated by fossil energy, and the overall transformation task is a long and arduous task.” Li Sheng, president of the General Institute of Hydropower Planning and Design, said that to achieve the goal of reaching the peak of carbon neutrality, the new energy system needs to form new productivity and meet the new requirements. “The planning and construction of the new energy system is a systematic project, and it is necessary to balance the relationship between development and security, clean transformation and energy supply protection, storage and increment. From electric, heat, cold, hydrogen, various forms of energy use, source network load storage links to work together.”

The person in charge of the National Energy Administration introduced that in the next step, we should base on our energy and resource endowment, adhere to the principle of creating before breaking, further promote the energy revolution, accelerate the planning and construction of new energy system, unswervingly promote the green and low-carbon development of energy, and focus on the following aspects of work: First, we will strengthen clean and efficient use of coal, actively promote energy conservation and carbon reduction in coal and power generation, flexibility and heat supply, and steadily promote demonstration and application of carbon dioxide capture, utilization and storage technologies. Second, we will vigorously develop non-fossil energy, promote the high-quality development of wind and solar power generation, promote the construction of major hydropower and nuclear power projects, and develop biomass energy, geothermal energy and other renewable energy sources in light of local conditions. Third, we should actively build a new type of power system, and strive to promote the power grid to actively adapt to the development of large-scale centralized new energy and distributed energy of large quantity and wide range. Fourth, we will vigorously promote the transformation and upgrading of terminal energy use, strengthen energy conservation and carbon reduction in key energy use areas, and actively promote electric energy substitution.