Worldwide including the US, China, and Germany, 'Reviving Manufacturing' in Full Swing...

[Image source=AP Yonhap News]

원본보기 아이콘

[Asia Economy Reporter Kim Eun-byeol] Since the outbreak of the novel coronavirus disease (COVID-19), the global perspective on manufacturing has changed. Developed countries, which had focused on nurturing the service industry with high added value and productivity, are now turning their attention back to manufacturing amid the economic crisis. They aim to secure both employment and growth by concentrating investments on new manufacturing sectors with high growth potential.

According to the website of U.S. President-elect Joe Biden's transition team on the 9th (local time), the Biden camp has adopted the slogan "Made in all of America, by all of America's workers." This stance goes a step further than former President Donald Trump's "Buy American" policy. While President Trump provided tax benefits to U.S. manufacturing companies and encouraged export partners to purchase more American products, President-elect Biden plans to foster high value-added manufacturing companies in electric vehicles, artificial intelligence (AI), 5G, and other sectors to create jobs within the United States. This strategy also aims to strengthen domestic supply chains to better respond to crises like COVID-19.

China, engaged in a hegemonic rivalry with the U.S., is also aggressively driving its manufacturing sector. The Chinese government has introduced the "Made in China 2025" strategy to nurture advanced industries. The goal is to develop leading companies in ten high-tech manufacturing fields?including medical devices, biopharmaceutical technologies and raw materials, robotics, telecommunications equipment, advanced chemical products, aerospace, marine engineering, electric vehicles, and semiconductors?within the next five years. China is focusing not only on scaling up but also on achieving technological self-sufficiency. The plan is to domestically supply 40% of core technologies, parts, and materials by this year and 70% by 2025. Success in technological self-reliance is crucial to winning the technological hegemony competition with the U.S.

Germany, a traditional manufacturing powerhouse, is considered to have weathered the COVID-19 crisis relatively well compared to other European countries. Feeling the pressure of being chased by Asian countries in manufacturing, the German government introduced the "National Industry Strategy 2030" last year to enhance competitiveness based on manufacturing. Germany is focusing on discovering small and medium-sized enterprises (SMEs) with technological capabilities in addition to established global companies like Siemens and BMW. The government supports the growth of SMEs and, once they reach a certain level, backs mergers and acquisitions (M&A) to secure economies of scale.

Japan, which has a history of dominating the world through manufacturing, is gathering funds to invest in new businesses worldwide. The "Vision Fund," established by SoftBank for discovering and investing in future growth engines, is a representative example.

© The Asia Business Daily(www.asiae.co.kr). All rights reserved.