Singapore media: China not only provides products, but also promotes global industrialization

Article on the website of Singapore's "Thinking China" magazine on August 25th, original title: Globalization 2.0: China provides not only products, but also industrial capabilities

For most of the past 40 years, globalization has been based on a simple principle: countries around the world exchange goods through trade and organize production activities based on their respective costs and efficiencies. The situation is vastly different now. Globalization 2.0 is increasingly connecting countries through production activities rather than trade.

This is not just a change in terminology. Industrial resilience, advanced manufacturing, green technology, artificial intelligence (AI), and integrated production ecosystems are increasingly becoming important sources of global competitiveness. China's own economic transformation reflects this broader transformation. Nowadays, China's competitiveness is no longer mainly based on low-cost labor, but increasingly relies on a well-established industrial ecosystem, competitive manufacturing capabilities, advanced engineering expertise, and a large team of technical workers. The significance of this transformation is not limited to trade statistics alone.

China's exports are increasingly not just consumer goods, but tools that enable other countries to carry out production activities. In China's foreign economic relations, exports of machinery, industrial equipment, electrical systems, electronic components, renewable energy equipment, energy storage systems, and industrial automation are becoming increasingly important components.

Therefore, China is gradually transforming from a global product supplier to a promoter of industrialization. The difference between the two is crucial. Consumer goods satisfy consumption, while machinery, production lines, and industrial components not only build production capacity, but also create employment and support future economic growth. So, the latter may have a more profound and lasting impact on the world than the export of manufactured goods.

This transformation also coincides with an important moment of global economic development. The world is undergoing a process that can be called 'double industrialization'. Many developing economies are entering a new stage of urbanization, industrialization, and infrastructure development. They require electricity, transportation systems, building equipment, manufacturing machinery, industrial products, and so on. The challenge they face is not only how to increase consumption, but also how to build the production capacity needed to create employment, increase income, and achieve sustainable development.

At the same time, developed economies are undergoing a different form of industrialization: reindustrialization. After decades of deindustrialization, the United States, Europe, and other developed economies are seeking to rebuild manufacturing capacity. They are investing heavily in industries such as AI, data centers, renewable energy, electric vehicles, and digital infrastructure. All of these industries require a large amount of machinery, industrial equipment, components, and intermediate goods.

These two types of economies are at vastly different stages of development, but they share an important commonality: both are creating strong demand for production capacity domestically. This is precisely where China's transforming economic role can play an important role. China has developed a comprehensive manufacturing ecosystem, which is not only advantageous in producing individual products competitively, but also in integrating machinery, components, logistics, technology, and industrial services into a wider production system.

For developing countries, China's economic transformation has created important opportunities for them. What they may need most is not more final consumer goods, but access to affordable machinery, industrial components, infrastructure, and technology to enable them to produce more products themselves. In this sense, China's industrial upgrading can form a complementary rather than competitive relationship with the industrialization of other developing economies.

The same logic applies to developed economies, but in different forms. The United States and Europe are concerned about supply chain resilience, industrial security, and reducing strategic dependence, and are eager to strengthen domestic manufacturing capabilities in sensitive areas. But the modern industrial system is extremely complex, making it difficult to produce all products domestically. Even countries advancing the process of re industrialization will continue to require machinery, components, industrial equipment, and other products from international suppliers.

Therefore, China can promote the global re industrialization process by reducing production costs and promoting industrial upgrading. This is particularly important in the development of renewable energy, energy storage, electric vehicles, green transformation technologies, and the physical infrastructure required for the AI economy. In some non sensitive areas, all parties can benefit from maintaining market openness and cooperative relationships.

This indicates that the essence of globalization is about to undergo a broader transformation. Traditional globalization is mainly organized around the flow of goods. The emerging globalization model may increasingly revolve around the common flow of goods, capital, technology, investment, and production capacity.

Chinese companies have increased their investment in manufacturing, industrial parks, logistics, renewable energy, digital infrastructure, and production facilities overseas. Nowadays, trade and investment are increasingly linked to industrial cooperation. This may create a more inclusive and mutually beneficial form of globalization.

The future of globalization should not be about choosing between China and the West or between trade and security, but about finding a balance between economic interdependence and national interests, as well as between efficiency and resilience. Therefore, the core issue of globalization in the next stage may no longer be who can produce more goods. The more fundamental question may be: Who can help more countries establish industrial capabilities that create wealth, employment, and sustained innovation?