Network data regulations + Smart manufacturing + Biologics

In this MERICS China Industries Brief, we cover the following topics:

China’s new network data regulations paint a mixed picture for foreign business
Unveiling the list: New research program for smart manufacturing solutions
Regulator launches contract manufacturing pilot for biologics
China seeks to strengthen its industrial base via new materials
China outlines roadmap for utilization of public data resources

1. China’s new network data regulations paint a mixed picture for foreign business

At a glance: The Ministry of Industry and Information Technology (MIIT) and the State Administration for Market Regulation (SAMR) released a call for applications to “unveil the list” for companies offering smart manufacturing solutions. “Unveiling the list” is a competition-based research model, whereby successful applicants are selected to undertake designated research tasks, with the aim of achieving breakthroughs in “key technologies” already identified by Chinese policymakers. The call includes:

Promoting the upgrading of industries such as raw materials, high-end equipment, consumer goods, and electronic information
Cultivating suppliers that have contributed to the development of smart manufacturing standards and smart manufacturing solutions
Encouraging research around specified typical smart manufacturing scenarios, for example the digital design of factories or production planning optimization
Instructing successful applicants to complete the stipulated research tasks within two years

MERICS comment: Smart manufacturing is an integral part of China’s industrial upgrading drive and technology-driven growth approach and an area in which it has achieved notable successes. A 2024 report from the China High-Tech Industrialization Research Association estimates the output value of China’s smart manufacturing industry will reach CNY 4.5 trillion in 2024, up from CNY 3 trillion in 2020. Production efficiency in smart pilot projects rose by 45 percent on average, shortening the product development cycle by 35 percent. Furthermore, 42 smart manufacturing international standards and more than 300 national standards had been issued by 2022.

However, China’s smart manufacturing ambitions face challenges. These include insufficient integration between different devices in smart factories, or inadequate standardization of the Industrial Internet. Moreover, the localization rate of core equipment and technologies is low, with 95 percent of China’s industrial software reliant on imports. The new “unveiling the list” application call may be an attempt to remedy this. If allowed to participate, foreign companies could benefit from the program. However, it could also turn into a vehicle for boosting China’s self-reliance if predominantly Chinese domestic companies end up being selected.

Article: Notice on Launching “Unveiling the List” Application Work for the 2024 Smart Manufacturing System Solution Plan (工业和信息化部办公厅市场监管总局办公厅关于开展2024年度智能制造系统解决方案“揭榜挂帅”申报工作的通知) (Link)
Issuing bodies: MIIT, SAMR
Date: October 24, 2024

2. Unveiling the list: New research program for smart manufacturing solution

Promoting the upgrading of industries such as raw materials, high-end equipment, consumer goods, and electronic information
Cultivating suppliers that have contributed to the development of smart manufacturing standards and smart manufacturing solutions
Encouraging research around specified typical smart manufacturing scenarios, for example the digital design of factories or production planning optimization
Instructing successful applicants to complete the stipulated research tasks within two years