Abstract: In this article, the author answers the question of how China can realize supply chain upgrade and security at a time when supply chains are being reshaped globally. He suggests China identify and address the vul-nerabilities within its industrial system and supply chains to deal with the challenge.
Since the launch of reform and opening-up in China 40 years ago, the economies of China and the United States have grown strongly interde-pendent through trade, investment and technology exchanges. However, with the narrowing of the economic gap between the two countries, a seri-ous sense of Sinophobia has developed among American political elites. The Trump administration regraded China as America's most important competitor. In addition to launching a trade war with China and imposing additional tariffs, the US government also included a large number of Chinese high-tech companies to its Entity List and imposed sanctions on companies such as ZTE and Huawei. Officials from the Trump admin-istration openly stated that they were doing this to cut China out of global high-tech supply chains. The Biden administration has softened its tone on economic policy toward China, but the basic stance to push China out of global tech supply chains (such as semiconductors, large aircraft, and precision machine manufacturing) has not changed.
For US politicians, the optimal policy will be to prevent China from catching up with the United States in high-tech fields, and to minimize the losses of US businesses caused by the decoupling. Therefore, im-plementation of such policies should be gradual and selective. The US government has also been working on the reshaping of supply chains. By early 2022, the Biden administration's policy has focused on improving domestic supply chains, and more specifically, addressing the vulnerabilities and building stronger and more resilient domestic supply chains for energy, network technology, semiconductors, key electronics, telecommunications infrastructure and critical raw materials.
China can quickly develop countermeasures if US policy is clear. Howev-er, the policy of Biden administration seems to be still in the making. The ambiguity and complexity of US policies make it difficult for Chinese companies to formulate measured response. Should they "throw away fantasies and prepare to fight", or "continue to hold on to hope and strive for better results"? Either move could be wrong and lead to huge losses.
For example, if China doesn’t immediately prepare backups or find a dif-ferent way for high-tech development, but is eventually cut out from global supply chains, we will have 5 or 10 years of time wasted. On the other hand, if the US government finally abandons the policy of isolating China from global tech supply chains, we will waste huge resources work-ing on backups which can be rather costly.
Dr. Xu Qiyuan and Dr. Dong Yan, together with their team, completed a research on Reshaping Global Industrial Chains: Options for China. In this book, they aim to address the question of how China can realize supply chain upgrade and ensure its security during the process of supply chain reshaping, or how China can minimize economic risks while integrating itself into the global division of labor to the greatest extent possible.
The authors have observed three supply chain trends: First, multinational companies will enhance the resilience of their supply chains through di-versified industrial agglomeration. Second, with the changes in global re-source endowment, supply chains will become more knowledge-driven, digitalized and capital-intensive in the medium and long term. Third, the greening and decarbonization of production will mainly affect developing countries reliant on energy exports or in the midst of industrialization.
In the book, the authors have identified a dilemma with the supply chain: A country can’t have full control over its supply chains and com-plete independence from imports if it wants global competitiveness and influence.
However, they believe that the United States has achieved an efficient balance on the issue. The US has successfully ensured its supply chain se-curity through political relations and the formation of alliances. Com-pared with the US, China's supply chains are more susceptible to po-litical factors.
The book examines the influence and vulnerability of Chinese products in global supply chains by applying network analysis. Specifically, by using export centrality index and import concentration index, the authors meas-ure the dependence of other countries on China's export of intermediate products, and China's dependence on import of intermediate products from other countries.
The research finds that China has a prominent influence in the trade of in-termediate goods of high export centrality. However, among the interme-diate products imported by China, 62 products feature high rates of global export centrality and Chinese import concentration. These products are the most vulnerable to external shocks and it is most difficult to find al-ternatives for the supply of these products. On this basis, product analysis shows that electrical machinery, audio-visual equipment and their parts and accessories (HS 2.85), nuclear reactors, boilers, mechanical appliances and parts (HS 2.84), optical, photographic, medical equipment and accessories (HS 2.90) are the three industries with the most vulnerable supply chains for China.
The authors also apply external dependence ratio in their quantitative analysis and demonstrate that as China continues to integrate into global value chains, its external dependence has not decreased, and is chal-lenged with the above-mentioned dilemma in technology-intensive industries. But in labor-intensive industries, as China has gradually mas-tered core technologies and methods, it is not so much under pressure from the dilemma.
Their research also shows that when only economic factors are consid-ered, China faces more production risks than sales risks, and the US vice versa. However, risks facing China increase sharply when political issues are taken into consideration, while the risks for the US mainly depend on its political relations with China. Risks for China further grow when sup-ply disruptions occur, while risks for the United States remain basically unchanged. In summary, China's supply chains are more susceptible to political risks than those of the United States.
The authors believe that, to enhance supply chain security, policies should not simply focus on strengthening internal circulation and reducing foreign dependence. Instead, China should increase diversi-fication and strengthen relations with countries that are highly de-pendent on exports. At the same time, China needs to strengthen its ties with countries with stable political relations, and properly handle relations with major powers, especially the United States. China needs to invest political resources so as to buy enough time before making breakthroughs in the production of core products.
Will Vietnam replace China as the next world factory? In 2020, Vietnam became China's third largest export destination. Therefore, Sino-Vietnamese trade can serve as an entry point for research. The book quan-titatively analyzes the characteristics of China's exports to Vietnam, and finds that the China-US trade conflict has the most direct impact on accelerating re-exportation and industrial transfer as it has substantially boosted China's exports to Vietnam in the short term; the effect of sus-tained production shift in exports cannot be ignored either. Economic complementarity is still the basis of Sino-Vietnamese trade, but com-petition has surpassed complementarity in importance.
It is pointed out in the book that China-US trade conflict, impact of the covid pandemic, digitalization, and decarbonization have made the re-structuring of global supply chains a lot more complex. The book dis-cusses the above four issues to varying degrees, especially US tariff hikes and its tariff exclusion process.
According to the book, the tariff exclusion process provides an excellent chance to get a glimpse of the real situation of China-US economic inter-twining. The approval or rejection of an application for tariff exclusion reflects the real economic impact of the imported goods on US business, from which we can see the limit up to which US companies can tolerate. The US government uses tariff exclusion to avoid putting US import businesses under excessive short-term pressure to the point of causing any irreversible damage. In the medium- and long-term, it is intended to sup-press the development of China’s strategic sectors by adding trade policy uncertainty and helping the US decouple from China.
Through the analysis of tariff exclusion, authors of the book find that in-dustries that have higher exclusion rates generally feature more complex production technologies, longer supply chains, and greater difficulty finding alternatives in a short period of time. The depend-ence on China in terms of import value is only a secondary consider-ation.
Taking bearings and bearing products as an example, American compa-nies are highly dependent on China for the bearing products and it is diffi-cult for them to find alternatives in the short term. However, these prod-ucts feature a simple production process, low value and easy supply chain transfer. The combination of tariff hikes and tariff exclusions will increase the policy uncertainty relating to these products and increase the likeli-hood of industrial chain relocation out of China. In terms of the bearing products that have not enjoyed tariff exclusion, the manufacturing process is more complicated, and the products are of higher value and mainly supplied by developed countries. Exclusion of tariffs on these products was denied for two reasons: China’s market share is small and easily re-placeable, and it helps the US suppress the upgrading of China's manufac-turing industry. The book points out that no matter from the point of view of tariff hikes or tariff exclusion, the key targets of US policies are China's high-tech industries. It’s easy to see the strategic intention of the US to curb China’s industrial development.
It should be pointed out that the book makes extensive use of quantitative, data-based analysis in order to make valid points. The numerous methods of analysis applied in the book are highly prescriptive. The authors have spared no time and efforts on data collection and consolidation, which ful-ly reflects their serious academic attitude.
While acknowledging the extensive use of quantitative and network anal-ysis, we also see the limitations. For example, the network analysis is overly inclined to the quantitative analysis but overlooks the qualitative analysis. The vulnerability represented by the same export centrality can be different for different products. I believe that the research could benefit from some fieldwork, as conclusions derived from “dissecting a sparrow”, that is, observing and talking firsthand with firms, could be more reliable and provide more reference for policymaking than those de-rived from mathematical models.
I. THE DILEMMA WITH INTERNATIONAL DIVISION OF LA-BOR AND INDUSTRIAL CHAINS
The book tries to answer an important question: How could a country up-grade its industrial chain while maintaining its controllability and inde-pendence? It’s the same question as “How could a country participate in the international division of labor while establishing and maintaining a relatively complete industrial system?” Since Alexander Hamilton, the first US Treasury Secretary, presented his famous Report on Manufac-tures in 1791, economists have debated the issue for more than 200 years.
From natural economy to commodity economy, from agricultural society to industrial society, the division of labor is a driving force of economic development. In an industrialized society, labor is divided within the scope of the nation-state before it expands across national borders and around the world to form an international division of labor system.
The division of labor, as a concept, was first introduced by Adam Smith in 1776 in The Wealth of Nations through his famous example of pins. “One man draws out the wire; another straights it; a third cuts it; a fourth points it; a fifth grinds it at the top for receiving the head; to make the head requires two or three distinct operations; to put it on is a peculiar business; to whiten the pins is another; it is even a trade by itself to put them into the paper; and the important business of making a pin is, in this manner, divided into about eighteen distinct operations, which, in some manufactories, are all performed by distinct hands, though in others the same man will sometimes perform two or three of them.” “Each person, therefore…might be considered as making four thousand eight hundred pins in a day. But if they had all wrought separately and independently, and without any of them having been educated to this peculiar business, they certainly could not each of them have made twenty, perhaps not one pin in a day.”
The so-called division of labor is the separation of tasks for individuals or groups of people to complete at different stages, which can greatly im-prove productivity.
The textile used to be the most important industry or "rural industry" in Britain before the Industrial Revolution. The textile process included cleaning, carding, spinning, weaving, smoothing, and dyeing. It did not require complex tools so these steps were carried out in homes or work-shops by families or apprentices.
In the late 17th century, Europe developed the domestic system, also known as the putting-out system, which includes two elements: the un-derwriter and the family workshop. An underwriter delivers wool or cot-ton raw materials to spinner farmers and then hands over the spun wool or cotton threads to other farmers for weaving. The underwriter buys the fi-nal product from farmers by piece (or salary) and sells it. With this sys-tem, farmers do not have to buy raw materials themselves (because the owner of the raw materials is the underwriter), nor do they have to worry about the sale of the products.
The Industrial Revolution in the 18th century witnessed the invention of the Flying Shuttle (John Kay, 1733), Spinning Jenny (James Hargreaves, 1765), Water Frame (Richard Ark-wright, 1769), Watt Steam Engine (Watt, 1775), and Watt-powered Spinning Mule (Crompton, 1779). Though Spinning Jenny could still be operated in a farmhouse, large ma-chines such as Water Frame and Spinning Mule were too big to be in-stalled or operated in a cottage (or workshop). To make the most of econ-omies of scale and the agglomeration effect of cities, entrepreneurs who aimed to minimize costs and maximize profits naturally located machines and factories in towns rather than scattered rural areas. The factory system thereby came into being.
The factory system, marked by the mechanization of textile production, was further strengthened in the late 18th century by the widespread use of replaceable units. Previously, each component of the Mauser was manu-factured by an individual worker and then assembled. The advent of re-placeable units means that any part of one Mauser produced to strict pro-cess requirements can be exchanged for the same part of another Mauser. This interchangeability ushered in the era of mass production.
The Industrial Revolution led not only to the factory system, the division and specialization of production, but also the development of different in-dustries. Steam engines mechanized textile production, and facilitated the development of coal, metallurgical, and metalworking industries. Ma-chine tool manufacturing made further development of mass production possible.
As production scaled up, it became more profitable to import raw materi-als from one country and sell the final product in another. In this way, some countries became exporters of raw materials and importers of manu-factured goods, while others did the opposite. That was how international trade developed rapidly.
Looking back at history, we can see that labor was first divided among families, the workshops, and the factories. At the same time, there were divisions of labor at the social and industrial levels, such as in agriculture, animal husbandry, and handicrafts. During the Industrial Revolution, the rapid development of the British textile industry gave birth to a series of new industries, forming a complete industrial system including agricul-ture (with a declining share), light industry, and heavy industry for the UK. Foreign trade consisted mainly of imports of food and raw materials and the exports of manufactured goods. There was no fragmentation of the production process or industrial chain trade. Already at that time, there was a debate on whether to establish an industrial system that transcends national boundaries and divides labor internationally based on absolute (or comparative) advantages, or to establish a relatively complete indus-trial system within a nation-state.
Hamilton pointed out in the Report on Manufactures in 1791 that the ad-vantages a nation has in an industry that has been established domestical-ly for many years are insurmountable obstacles to others that seek to in-troduce this industry into their own countries. That industry, new in one country and mature in another, cannot in most cases be expected to com-pete on the same terms of quality and price. German economist Friedrich List later refined this argument into the theory of infant industry protec-tion, that is, new industries in developing countries need protection against competitive pressures until they mature and develop econo-mies of scale that can rival their competitors.
Why developing an industry even if there is no competitive advantage right now? List argues that as the UK and the US implement policies to “kick away the ladder” for latecomers to climb up to the same level of de-velopment, it is fair to use tariffs or other measures to protect nascent in-dustries that could one day gain comparative advantages. More important-ly, List believes that the division of labor should be accompanied by a sense of national unity, independence, common goals, and cooperation among productive forces. He considers the industrial system and the in-ternational division of labor from the perspective of maximizing national interests. The biggest difference between List and Adam Smith is that the latter is a globalist who believes that what is good for Britain must be good for the world.
Interestingly, while denouncing Britain's protectionist manufacturing pol-icies, Adam Smith, an advocate of free trade, supported the Navigation Act that gave Britain a monopoly on ships and sailors, because "defense is more important than wealth".
It is evident that for all nation-states, especially large ones, participa-tion in the international division of labor based on comparative ad-vantages (including dynamic comparative advantages) is not uncon-ditional, and should be coordinated with the development of a com-plete industrial system. A sufficiently complete industrial system im-plies two things. First, the ability to reach the top even when trading part-ners “kick away the ladder”. For example, without steel, machine build-ing, and certain high-tech industries, a major country may forever lose its chance to enter the ranks of advanced nations. And second, national secu-rity, which includes food and energy security as well as national defense.
How does a developing country become a developed one? In the case of the Soviet Union, it prioritized the development of heavy industries. By funding industrial development through "price scissors", the Soviet Union imported a large number of machinery and equipment from the US during the Great Depression, which facilitated industrialization and the creation of a complete industrial system. In the report of the first five-year plan, finished ahead of schedule in 1933, the Soviet Union proudly announced:
"We did not have an iron and steel industry, the basis for the industriali-zation of this country. Now we have one. We did not have a tractor indus-try. Now we have one. We did not have an automobile industry. Now we have one. We did not have a machine-tool industry. Now we have one..."
With the help of the Soviet Union during its "First Five-Year Plan" peri-od, China started 156 key industrial projects that laid a foundation for its industrialization. Despite the setbacks brought by the Cultural Revolu-tion, after nearly 30 years of hard work, China developed a relatively complete industrial system that other developing countries do not have.
After World War II, Asian economies such as Japan and South Korea were also committed to establishing their industrial systems while im-plementing export-oriented strategies. For example, despite having no comparative advantage, South Korea made a major effort to develop its heavy chemical and steel industries in the 1970s, largely driven by securi-ty concerns.
After the launch of reform and opening-up, China hoped to introduce advanced foreign equipment and upgrade its outdated technology and equipment. However, the willingness to participate in the inter-national division of labor and to exploit China's comparative ad-vantages through foreign trade was constrained by the extreme shortage of foreign exchange reserves, which in 1978 totaled a misera-ble $167 million. Fortunately, when China opened its doors, original equipment manufacturing (OEM) was at its prime, especially in East Asia. As OEM does not requires the spending of forex reserves on raw materials and intermediate products, Chinese enterprises were only re-sponsible for processing, leaving the rest to the foreigners. By processing incoming materials, China received foreign exchange corresponding to the added value. Such production and trade methods are similar to the put-ting-out system in the pre-industrial revolution period in Britain. OEM in China started with the so-called “processing and compensation trade” be-fore upgrading to processing trade. After nearly 20 years of hard work, China has completely solved the problem of foreign exchange short-age. In 1999, the share of intermediate products in China's exports peaked at 57%. By that point, the country has been inadvertently embedded in global value chains.
While working to prosper its processing trade, China also actively intro-duced foreign direct investment (FDI). Different from foreign borrowing, FDI inflow was closely associated with multinational companies’ busi-ness strategy. In fact, many of the FDI providers were engaged in pro-cessing trade, contributing to most of the processing trade China had with the rest of the world. FDI has gradually became the most important way through which multinational companies introduced Chinese companies into the global value chain.
Global value chain is a result of the production processes divided into many phases located in different parts of the world. Technological ad-vances and trade liberalization have broken the production process of de-veloped countries into more, smaller phases. When certain technological conditions (products becoming lighter, smaller, higher-value and more standardized, stable and independent) and institutional conditions (low or even zero tariffs) are met, allocating the production of electronic product modules across the production cycle to different countries could signifi-cantly lower total costs. This is in essence extending the division of labor within factories to across the world. The process today involves two types of division. One is based on industry or resource endowment: for exam-ple, Australia and Brazil are major iron ore producers, while South Korea and China provide textiles and clothing and iron products. The other is based on the production phases involved in manufacturing a final product.
China engages in the international division of labor in two ways. First, via the flying geese paradigm (FGP). It participates in the global division of labor through trade, to enable the upgrade and relocation of various sectors including textile, iron and heavy chemical. This is a divi-sion of labor among industries across countries. Second, it joins the glob-al value chain or the international production network via processing trade. This is a division of labor among countries during the manufactur-ing of the same product. Participating businesses strive to move up the supply chain toward more technology-intensive and high-value-added segments. The various phases are connected via processing trade.
Compared to the first approach, the second approach has remarkable posi-tive effects on economic growth and technological development; but at the same time, it greatly erodes a nation’s economic security. Most im-portantly, the global value chain is designed and dominated by mul-tinational companies from developed countries, and developing countries can only passively accept roles assigned to them, as proces-sors or assemblers. Multinational companies are the organizer and man-ager who decide which country could enter the global value chain and at which point.
Under normal circumstances, participating in global division of labor brings about both good and bad things. Good things include improved re-source allocation and production efficiency, and introduction of advanced technologies and management models; while bad things include a disad-vantaged position in international division of labor and profit sharing as well as trade frictions since assemblers and processors at the bottom of global value chains usually record trade surplus against final product buy-ers.
China’s own industrial system will not remain intact as participation in the global value chain increases. In fact, since the implementation of the export-oriented strategy characterized by processing trade and FDI, fast growth in certain industries were accompanied by the decline or even disappearance of other important industries. China even witnessed a wave of mergers and acquisitions around 2005 when many of its backbone state-owned enterprises (SOEs) became multinationals’ subsidiaries. For-tunately, China has managed to preserve a relatively complete indus-trial system, owing to the fact that it had established such a system before it joined global value chains and the government’s prudence, with many important industries remaining independent. In fact, ac-cording to the classification of the United Nations Industrial Development Organization, China is the only country with all categories of economic activities.
II. SECURITY OF CHINA’S INDUSTRIAL SYSTEM
Security of China’s industrial system should be examined in three dimensions: external dependence, completeness and adaptability. I will not probe further into the first which has been fully discussed in the book.
Completeness and external dependence are two related but different con-cepts, and two standpoints to look at industrial system security. Com-pleteness can be surveyed from an input-output matrix perspective: all in-dustries of a country are interdependent, each subject to influence to vari-ous extents when one industry, or one category (big, medium or small) of industries, is absent. For example, agriculture and energy are fundamen-tally critical for a big country like China; while iron, heavy chemicals, machine manufacturing and other high-tech sectors are also necessary for China’s development. China cannot afford the absence of any of these sectors regardless of their economic benefits in the medium and short run. That’s also why hybrid rice developed by Dr. Yuan Longping has such a significance. China is also extremely rich in coal, so if it can make break-throughs in the clean use of coals, and wouldn’t need to worry about oil embargos imposed by other countries.
Completeness does not necessarily mean “big and all-encompassing” or “self-sufficient”. Many sectors are not indispensable. But in any case, it’s vital to preserve a relatively complete industrial system. Many countries that focused too much on the advancement of a limited range of sectors now have an imbalanced industrial structure that adds to their vulnerabil-ity to external shocks. In contrast, China has shown remarkable resili-ence throughout the COVID-19 pandemic thanks much to its com-plete industrial system, especially its strong manufacturing sector.
Adaptability refers to the balance between efficiency and security. For ex-ample, a country may not have a complete industrial system given its po-sition in the global division of labor, but as long as it has strong manufac-turing ability, it can rapidly address its vulnerabilities as circumstances demand. The level of adaptability of a country’s industrial system is largely determined by whether its fundamental industries are fully devel-oped. For example, any gap in the supply of a sub-category of machine tools can be quickly filled as long as the country has a robust universal machine tool industry. The ultimate adaptability of the industrial system builds upon education, R&D, and development of high-tech industries.
Improved security of an industrial system comes inevitably at the cost of lower production efficiency. A country will be more productive with higher economic growth when it is deeply integrated into the interna-tional division of labor and value chains, but at the same time its in-dustrial system will become less secure. It has to strike a balance in be-tween.
III. US ATTEMPTS AT BALANCING SECURITY AND EFFICIENCY OF VALUE CHAINS
It would be useful to look at how the US has tried to achieve such a bal-ance.
The Congressional Research Service envisaged how the US could re-shape global value chains in a report in December 2020.
First, leave the Chinese market, and relocate some of the low-value-added manufacturing to Vietnam.
Second, diversification and redundancy. For example, businesses rely-ing on intermediate products from China could adopt a “China + 1” strat-egy. Supplier diversification will increase costs and reduce profits, and redundancy could add to wastes, but many companies still choose this strategy instead of relying on just one supplier.
Third, regional supply chains. This could cushion global shocks, reduce transportation costs and improve goods delivery, and preferential treat-ments within the region could bring further benefits. However, it also nar-rows the pool of potential partners for companies within the region, while increasing their exposure to local shocks.
Fourth, stockpile. If unwilling to adjust their existing supply chains, companies could only increase their inventories along the supply chain in case of unexpected shocks, which will increase costs and wastes.
Fifth, vertical production, or increase domestic production while de-creasing outsourcing. This will entail increased investment across all phases along the supply chain, including production of parts, assembly and packaging, and requires a company to put all phases under its control. The high costs incurred will cost businesses the ability to improve effi-ciency through specialized production or curb risks through diversifica-tion.
Sixth, reshore. This will, again, push up costs and reduce a company’s ability to diversify risks. The Japanese government once introduced poli-cies to encourage reshoring. In April 2020, it provided a total of 2.2 bil-lion USD to incentivize its businesses to bring high-value production back in borders or to other East Asian countries from China. The Trump administration did essentially the same thing.
Seventh, stay put. Many of the multinationals mainly serve the local market which they don’t want to lose. The localization policy of the host country has forced these companies to make a stay-or-go choice, which isn’t an easy one.
Eighth, no change. Companies could choose to face the risks associated with the global value chain and stay abroad (but not necessarily in the same host country). This is perhaps the best choice for certain types of businesses, such as garment makers.
IV. CHINA NEEDS TO ADDRESS FOUR PROBLEMS WITH ITS INDUSTRIAL SYSTEM AND SUPPLY CHAINS
China should identify and work to address the vulnerabilities with its industrial system and supply chains.
Efforts are especially needed at four fronts from the perspective of global supply chain restructuring.
First, the Chinese government should help the high-tech sectors that are already deeply embedded in global supply chains to improve their independence and controllability, so as to earn more time for the “backups” to grow and mature. High-tech companies must be so-berly aware of the reality, and strive to build a complete supply chain at home.
Second, for non high-tech sectors that could boost economic growth and reduce regional inequality, China should keep more production phases within borders or transfer them to western or northern part of the country if plausible.
Third, China has to build a domestic production network led by its own champion companies. To this end, it needs to eliminate regional barriers and optimize the division of labor for important products across the country, rather than within a province or a city. Some of the Chinese companies prefer joining the global supply chains to becoming part of the domestic production network, or don’t have the opportunity to do so. In this case, the government may need to intervene and introduce incentives as appropriate.
Fourth, foster and expand the domestic market by reforming the economic system, taxation policies, social security system and the provision of public goods, so as to reduce Chinese products’ reliance on global demand.
In short, in view of the changes in the global economy and geopolitics, it’s necessary to carry out an in-depth, national-level evaluation of Chi-na’s industrial system, identify vulnerabilities, and make adjustments at the industry and product levels, so as to realize a proper balance between economic efficiency and industrial system security.
This book has made meaningful contribution to the discussion on how China can cope with global supply chain restructuring, and I believe the authors will, building on their current work, provide more pragmatic poli-cy recommendations in the future.
This article is a preface for the book Reshaping Global Industrial Chains: Options for Chi-na written by the research team led by Xu Qiyuan and Dong Yan. It was published on CF40 WeChat blog on May 14, 2022. The English text was translated by CF40 and has not been reviewed by the author. The views expressed herein are the author’s own and do not repre-sent those of CF40 or other organizations.
