China’s manufacturing industry is aiming to transform itself from “Quantity” to “Quality”. The key strategy is to develop a digital economy, said Li Yizhong, the former minister from China’s Ministry of Industry and Information Technology on Sunday.
Speaking at the 2018 World Forum on Scientific and Technological Innovation in Beijing，Li said “A digital economy means a deep integration of Information technology (IT) and the manufacturing industry.”
“It is the trend of a global economy as well as a national strategy for a high-quality growth in manufacturing and internet development,’ he added.
Then, how to develop a digital economy?
Li noted that cutting-edge technologies like big data, internet, cloud computing, and Artificial Intelligence (AI) need to be closely integrated with the manufacturing industry to develop new products and business models.
There are three areas where China’s digital economy has developed the most in recent years, Li summarized, firstly, the IT industry has seen a fast growth and contributed 8 percent to the overall GDP growth last year.
Secondly, enterprises have played bigger roles in developing a digital economy. They have realized the significance of the integration between manufacturing and IT. For instance, Alibaba has rolled out an industrial system that integrated the internet and its companies. The IT industry includes telecom manufacturing, communication services, software and the internet industries.
Thirdly, the benchmarks in digitalization have been improved. For example, indoor broadband penetration has reached 86.7 percent while mobile broadband penetration has risen to 86.3 percent, and the internet surfing fee has been reduced by 46.2 percent, which has exceeded the goals set for 2020.
The number of robots used by every 10,000 workers on average has been increased from 23 in 2013 to 50 as of now, which is close to the world’s averages. The patents held by every 10,000 citizens on average have doubled since 2013. Moreover, enterprises hold over 60 percent of the overall patents.
He also pointed out the challenges faced by digital economy developments.
Core technologies are still controlled by other nations. The Chinese economic structure is still at the low-end. There are significant gaps between China and other developed countries in chips, integrated circuits, software, and data processing techniques. Ninety-five percent of high-end chips are from overseas. Therefore, technological innovations are vital for developing a digital economy.
Most enterprises lack awareness when it comes to digital transformation. They need technical assistance and support. Their understandings of how technologies could enhance productivity require further education. Meanwhile, tech companies lack the knowledge of the industrial demands.
Li suggested strengthening the communication and education for digital transformation among enterprises and leading industrial enterprises by collaborating with internet giants to develop new applications.
On the one hand, interdisciplinary talents who have both knowledgeable of technologies like big data and have the industrial expertise are extremely scarce. On the other hand, loads of traditional workers have been laid off. In France, 3 million jobs will disappear because of digitalization. While in the Guiyang hi-tech industrial development area, 42,000 jobs were created by the digital economy and related industries, Li said.