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Industrial Economy

A Proper Approach toward the Outflow China’s Manufacturing Industry(No. 195, 2017)


By Yang Jianlong, Research Department of Industrial Economy, DRC

Research Report No. 195, 2017 (Total. 5270) 2017-12-25

Abstract: In recent two years, the volume of China’s outbound investment has exceeded that of foreign capital utilization. While becoming a net capital exporter for the first time, China has basically realized a more balanced and coordinated high-level and open-oriented development pattern through absorbing foreign capital and expanding export. This change not only indicates China’s sharpened competitive edge in the international industrial division of labor, but also shows the positive move taken by some industries in China to solve excess capacity and promote industrial structure adjustment and upgrading. If we could have a correct understanding of this fact and follow the development trend, we could accelerate the promotion of domestic industrial upgrading in the process of cultivating new comparative advantage and at the same time, create a low-cost and fair competition environment to facilitate investment and ensure the manufacturing industry to maintain a sustainable and healthy development through reform and innovation. Therefore, we need to pay close attention to the outflow of China’s manufacturing industry, guide and grasp the pace of outbound investment in a timely manner, so as to avoid manufacturing industry’s large-scale outflow and even the industrial hollowing-out due to the inadequate reform arrangements or supporting measures. In addition, we need to speed up the improvement of infrastructure and supporting industries, guide the central and western regions to actively undertake the transfer of eastern manufacturing facilities, and build a batch of leading industrial clusters in line with local reality.

Key words: outbound investment, manufacturing industry, balanced development