China's Provincial Economic Competitiveness and Policy Outlook for the 13th Five-year Plan Period (2016-2020) (eBook)

Prof. Jianping Li is the former President of Fujian Normal University, Director of FJNU Branch of National Research Center of Comprehensive Economic Competitiveness, PhD supervisor, an expert on Fujian Province, and recipient of the State Council Special Allowance and National Young & Mid-aged Expert with Outstanding Contribution. He is also an academic leader at Fujian University’s key discipline “Political Economics”, a PhD program focusing on Theoretical Economics and the sub-discipline Fundamentals of Marxism. He is Vice Chairman of the China Association of Capital Studies, the National Association of Marxist Economics History, China Association of Historic Materialism, Fujian Province Association of Social Sciences, and Fujian Province Association for Science and Technology, as well as economic adviser of the People's Government of Fujian Province. Prof. Li’s research focuses on Marxist economic ideological history, capital and socialist market economies, economic reform methodologies, and regional economic development. He has led over 20 national and provincial/ministerial key research projects, compiled/wrote more than 60 academic books (including those he coauthored) such as Dialectic Exploration on Volume I of Capital and A Report of Overall Competitiveness of China’s Provincial Economy, and has published over 100 academic papers in periodicals like People's Daily and Economics Information. He is the recipient of seven first prizes and two second prizes including the Fujian Province Excellent Philosophy and Social Sciences Research Result Award, as well as the Excellent Theoretical Paper Award in the 7th National “Five-One” Project. Prof. Minrong Li holds a PhD in Economics. He is currently Director General of the China Institute of Science and Technology Evaluation. He is a former Director of the Development Research Center of the People's Government of Fujian Province, adjunct professor at Fujian Normal University, doctoral supervisor and Vice President of the China Regional Economics Society. Prof. Li’s main research interests are in macroeconomics, regional economic competitiveness, and modern logistics, and he has published more than 20 books (including those he coauthored), such as A Study of the Overall Competitiveness of China's Provincial Economy (1998-2004), Annual Report on Competitiveness of China’s Provincial Agriculture, Annual Report on Competitiveness of China’s Provincial Forestry, and West Shore of Taiwan Straits and Taiwan published in Taiwan; he has also contributed more than 240 academic papers in periodicals like People’s Daily, Qiushi Journal, Management World, and Economics Information. Recently he has led several provincial key research projects, including the National Social Science Fund project, A Research of Forecasting and Evaluation of Overall Competitiveness of China’s Provincial Economy, Application of the Empirical Economics Theories and Methodology in Regional Economy, and A Study on the Several Key Issues in Constructing Western Taiwan Straits Economic Zone during the “Eleventh Five-year” period. His research achievements include more than 10 provincial/ministerial awards, including third prizes of the second and third Excellent Achievements in Social Sciences award of Xinjiang Uygur Autonomous Region, as well as the Provincial Prize for Progress in Science and Technology (third place), first prizes of the 7th and 8th Excellent Achievements in Social Sciences, second prize of the 6th Excellent Achievements in Social Sciences, and third prize of the 7th Excellent Achievements in Social Sciences in Fujian Province. Prof. Maoxing Huang is the Vice (Managing) Dean of the School of Economics at Fujian Normal University, Executive Deputy Director of the FJNU Branch of the National Research Center of Comprehensive Economic Competitiveness, Executive Director of the Talent Development Research Center of Fujian Province, Vice Director General of the Chinese Association of Quantitative Economics, Standing Council of the Chinese Association of Regional Economics, as well as the Standing Council of the Chinese Research Association of Economic Laws. He is mainly engaged in technical economy, regional economy and competitiveness research and has led more than 50 research projects at the national and/or ministerial level. He is also the author or coauthor of over 41 books including Technical Choice and Upgrading Industrial Structure, Research on Technique Choice and Economic Growth, and Research on National Innovation Competitiveness. He has published more than 150 academic papers in key periodicals such as Economic Study, Management World, Economics Information, and Xinhua Digest. His research achievements have been honored with over 20 awards, including one first prize (coauthor) in the First National Excellent Papers on Economic Census Award of the State Council, four first prizes (coauthor) in the 7th-9th Fujian Excellent Social Science Researches Award, and two second prizes in the 8th-9th Fujian Excellent Social Science Researches Award. He was also selected in a number of talent incentive programs, such as the young top-notch talent of the first national “Ten Thousand Talent Program”, leading talent on Philosophy and Social Science of the second batch of national “Ten Thousand Talent Program”, “China’s Cultural Celebrities and Four Batches of Talents”, “National-Level Candidate of the National Hundred, Thousand, and Ten Thousand Talents Project”, “New Century Excellent Talent of Ministry of Education”, and “Chinese Youth May Fourth Medal”. His research team was recognized as a “Chinese Education System Excellent Group” in 2014 by the Ministry of Human Resources and Social Security and the Ministry of Education.  

Foreword 6
Series Preface 8
Acknowledgements 10
Contents 12
About the Authors 20
1 Overall Assessment of China’s Provincial Economic Competitiveness 23
1.1 Assessing Overall Economic Competitiveness on Provincial Level 23
1.1.1 Assessment Results 23
1.1.2 Rankings by Overall Economic Competitiveness 24
1.1.3 Changes in Rankings by Overall Economic Competitiveness 25
1.1.4 Cross-Brackets Changes and Causes 26
1.2 Comparing Provincial Economic Competitiveness by Region 30
1.2.1 Provincial Differences in Overall Economic Competitiveness 30
1.2.2 Provincial Economic Competitiveness by Region 32
1.2.3 Provincial Differences in Overall Economic Competitiveness by Region 33
1.3 Assessing Macroeconomic Competitiveness on Provincial Level 35
1.3.1 Assessment Results 35
1.3.2 Rankings by Macroeconomic Competitiveness 35
1.3.3 Changes in Rankings by Macroeconomic Competitiveness 36
1.3.4 Cross-Brackets Changes 37
1.3.5 Drivers of Macroeconomic Competitiveness 37
1.4 Assessing Industry Competitiveness on Provincial Level 41
1.4.1 Assessment Results 41
1.4.2 Rankings by Industry Competitiveness 41
1.4.3 Changes in Rankings by Industry Competitiveness 43
1.4.4 Cross-Brackets Changes 43
1.4.5 Drivers of Industry Competitiveness 46
1.5 Assessing Sustainability Competitiveness on Provincial Level 46
1.5.1 Assessment Results 46
1.5.2 Rankings by Sustainability Competitiveness 47
1.5.3 Changes in Rankings by Sustainability Competitiveness 48
1.5.4 Cross-Brackets Changes 49
1.5.5 Drivers of Sustainability Competitiveness 49
1.6 Assessing Financial Competitiveness on Provincial Level 52
1.6.1 Assessment Results 52
1.6.2 Rankings by Financial Competitiveness 52
1.6.3 Changes in Rankings by Financial Competitiveness 53
1.6.4 Cross-Brackets Changes 54
1.6.5 Drivers of Financial Competitiveness 54
1.7 Assessing Knowledge Economy Competitiveness on Provincial Level 57
1.7.1 Assessment Results 57
1.7.2 Rankings by Knowledge Economy Competitiveness 57
1.7.3 Changes in Rankings by Knowledge Economy Competitiveness 59
1.7.4 Cross-Brackets Changes 62
1.7.5 Drivers of Knowledge Economy Competitiveness 62
1.8 Assessing Development Environment Competitiveness on Provincial Level 62
1.8.1 Assessment Results 62
1.8.2 Rankings by Development Environment Competitiveness 63
1.8.3 Changes in Rankings by Development Environment Competitiveness 64
1.8.4 Cross-Brackets Changes 65
1.8.5 Drivers of Development Environment Competitiveness 65
1.9 Assessing Government Competitiveness on Provincial Level 68
1.9.1 Assessment Results 68
1.9.2 Rankings by Government Competitiveness 68
1.9.3 Changes in Rankings by Government Competitiveness 69
1.9.4 Cross-Brackets Changes 70
1.9.5 Drivers of Government Competitiveness 70
1.10 Assessing Development Status Competitiveness on Provincial Level 74
1.10.1 Assessment Results 74
1.10.2 Rankings by Development Status Competitiveness 74
1.10.3 Changes in Rankings by Development Status Competitiveness 76
1.10.4 Cross-Brackets Changes 79
1.10.5 Drivers of Development Status Competitiveness 79
1.11 Assessing Overall Planning and Coordination Competitiveness on Provincial Level 79
1.11.1 Assessment Results 79
1.11.2 Rankings by Overall Planning and Coordination Competitiveness 80
1.11.3 Changes in Rankings by Overall Planning and Coordination Competitiveness 81
1.11.4 Cross-Brackets Changes 82
1.11.5 Drivers of Overall Planning and Coordination Competitiveness 82
1.12 2013–2014 Changes in China’s Provincial Economic Competitiveness: Characteristics and Significance 85
1.13 Rankings by Overall Economic Competitiveness Were Stable on the Whole, with Marked Ranking Changes Experienced by a Few Provinces 85
1.13.1 Overall Economic Competitiveness Involves Many Factors and Reflects a Province’s Capacity for and Level of Economic Development 87
1.13.2 Industry Competitiveness is an Important Factor that Influences or Promotes the Improvement of Overall Economic Competitiveness So It Should be Consolidated Constantly 89
1.13.3 Performance by Indicators with Higher Rankings Should be Improved to Maintain Higher Levels of Overall Economic Competitiveness 90
1.13.4 An Important Way of Enhancing Overall Economic Competitiveness is to Increase the Number of Rising Indicators and Reduce the Number of Falling Indicators 93
2 International Level: Global Economic Landscape and Development Trend 95
2.1 Global Economic Landscape 95
2.1.1 Economic Development in Major Countries 95
2.1.2 Risks and Opportunities Facing Major Countries 98
2.2 Features of Global Economic Competition 101
2.2.1 Widening Differences Between Countries 101
2.2.2 Competition in All Aspects 103
2.2.3 Focus on Both the Real Economy and the Financial Sector 106
2.2.4 Regional Cooperation Initiatives 108
2.3 Global Economic Trends 109
2.3.1 International Trade 109
2.3.1.1 Impact on Trade Globalization 109
2.3.1.2 Recovery of European and American Economies and Rise of Emerging Markets 111
2.3.2 International Division of Labor 113
2.3.3 International Economic Competition 117
2.3.3.1 Competition in Emerging Industries 117
2.3.3.2 Building of Sound Innovation System 120
2.4 China’s Response to the New Developments in Global Economic Competition 121
2.4.1 Characteristics of the Chinese Economy Under the New Normal 121
2.4.2 How to Increase Gains from Trade Given the Global Value Chain 123
2.4.3 How to Innovate in the Third Phase of Globalization 125
Reference 126
3 National Level: Key Areas and Strategic Breakthroughs for Enhancing China’s Overall Economic Competitiveness 127
3.1 Seeking New Opportunities for Enhancing China’s Overall Economic Competitiveness Under the New Normal 128
3.1.1 Fluctuation to Be Changed 128
3.1.2 Weaknesses to Be Overcome 130
3.1.3 Leading Edge to Be Gained 131
3.1.4 Breakthroughs to Be Achieved 132
3.1.5 Enthusiasm and Creativity to Be Leveraged 133
3.2 Key Areas of Efforts to Enhance China’s Overall Economic Competitiveness During the 13th Five-Year Plan Period (2016–2020) 135
3.2.1 Reform of the Economic System 135
3.2.2 Upgrading of the Economic Structure 137
3.2.3 Institutional and Technological Innovation 139
3.2.4 Balanced Development Among Regions 141
3.2.5 Environmental Protection 143
3.3 Strategic Breakthroughs for Enhancing China’s Overall Economic Competitiveness During the 13th Five-Year Plan Period (2016–2020) 145
3.3.1 Strategic System 145
3.3.2 Strategy Implementation 147
3.3.2.1 Deepening Reform Across the Board 147
3.3.2.2 Innovation-Driven Development 148
3.3.2.3 Opening up 149
3.3.2.4 Inclusive Development 150
3.3.2.5 Winning by Quality 151
3.3.2.6 Proper Intervention 152
3.4 Measures for Enhancing China’s Overall Economic Competitiveness During the 13th Five-Year Plan Period (2016–2020) 153
3.4.1 Following Changes in Domestic and International Environments 153
3.4.2 Strengthening Collaboration and Synergies 153
3.4.3 Keeping All Parties Fully Motivated 154
3.4.4 Developing and Introducing High-Quality Talents 155
4 Regional Level: New Landscape of Competition and Cooperation Among Regions in China 156
4.1 Development of Regions in China During the 12th Five-Year Plan Period (2011–2015) 156
4.1.1 Positive Results 156
4.1.1.1 Gaps Among Regions Narrowing and Development Much Better Balanced 157
4.1.1.2 Geographical Space Better Structured and New Growth Poles Springing up in Regions 158
4.1.1.3 Functional Zones Under Trial and Geographical Space Better Developed 159
4.1.1.4 Urban–Rural Coordination Enhanced and New Urbanization Progressing Smoothly 161
4.1.1.5 Cooperation Among Regions Strengthened and an Integrated and Efficient Open Market Taking Shape 163
4.1.2 Major Problems 165
4.1.2.1 Imbalances in Development as Evidence by Absolute Disparities 165
4.1.2.2 Balanced Development Lacking Momentum Due to Blocked Free Flow of Factors 165
4.1.2.3 Inclusive and Similar Policies Affecting Coordination Among Regions 166
4.1.2.4 Low Level of Integration Within Regions with Win–Win Outcomes yet to Be Fully Achieved 166
4.2 New Landscape of Competition and Cooperation Among Regions in China During the 13th Five-Year Plan Period (2016–2020) 167
4.2.1 Coordinating Governance Between the Four Regions for Integrated Development 167
4.2.2 Making the Belt and Road, the Beijing–Tianjin–Hebei Region, and the Yangtze River Economic Belt Growth Poles for Balanced Development Among Regions 168
4.2.3 Increasing Capacity of Free Trade Areas to Drive the New Round of Opening up 169
4.2.4 Increasing Synergies Between Provinces for Integrated Development of Urban Agglomerations 170
4.2.5 Coordinating Overland and Offshore Operations and Boosting the Blue Economy 171
4.3 New Features of Competition and Cooperation Among Regions in China During the 13th Five-Year Plan Period (2016–2020) 171
4.3.1 Balanced Development Among Regions Will Be Promoted on Higher Levels 171
4.3.2 The Shift of Focus from Competition to Cooperation and Coordination Among Regions Will Be Clearer 173
4.3.3 Urban Agglomerations Will Be a Major Area of Competition and Cooperation Among Regions 174
4.3.4 Innovation-Driven Development Will Shape the New Landscape of Competition 175
4.3.5 An Important Part of the Efforts to Narrow Gaps Among Regions Will Be Take Targeted Measures to Reduce Poverty 176
4.3.6 The Competition and Cooperation Among Regions Will Be Integrated into an Opener International Environment 177
4.4 Strategies for Improving Competition and Cooperation Among Regions in China During the 13th Five-Year Plan Period (2016–2020) 178
4.4.1 Further Implementing the Master Strategy for Regional Development and Functional Zoning Strategy to Boost Balanced Development Among Regions 178
4.4.2 The Belt and Road Initiative and Free Trade Area Strategy Will Raise the Level of Reform and Opening up Across the Country 180
4.4.3 Boosting the Coordinated Development of Beijing, Tianjin and Hebei as an Example for Promoting Urban Agglomerations and Balance Among Regions 181
4.4.4 Implementing the Strategy of Innovation-Driven Development to Create New Competitive Edges of Regions 182
4.4.5 Continuing the Targeted Approach to Poverty Reduction to Accelerate the Narrowing of Development Gaps Among Regions 183
References 183
5 Industry Level: Areas of Focus and Directions for the Enhancement of China’s Industry Competitiveness 184
5.1 China’s Industry Competitiveness During the 12th Five-Year Plan Period and Comparisons with Other Countries 185
5.1.1 Chinese Industry Competitiveness During the 12th Five-Year Plan Period 185
5.1.1.1 Significant Results from Industrial Restructuring, with Structure of Primary, Secondary and Tertiary Sectors Optimized Over Time 185
5.1.1.2 Swift Development of Manufacturing, with Clear Comparative Advantages of Scale 187
5.1.2 International Comparisons for Chinese Industry Competitiveness 191
5.1.2.1 Market Share 191
5.1.2.2 Trade Competitiveness Index 192
5.2 Environmental Factors Affecting the Enhancement of China’s Industry Competitiveness During the 13th Five-Year Plan Period 194
5.2.1 Global Industrial Reform Brings Opportunities and Challenges for the Enhancement of Chinese Industry Competitiveness 194
5.2.1.1 Global Industrial Reforms Bringing Plethora of Challenges to the Task of Enhancing Chinese Industry Competitiveness 194
5.2.1.2 Global Industrial Reforms also Bring Opportunities for the Enhancement of Chinese Industry Competitiveness 197
5.2.2 Domestic Environment Brings New Pressures as Well as New Driving Forces for Upgrades and Optimization 199
5.2.2.1 Transforming the Many Pressures of Industry Development into the Driving Force for the Enhancement of Industry Competitiveness 199
5.2.2.2 Good Policies and Incentive Measures Can Help Inject New Energy into the Industry Optimization and Upgrade Process 201
5.3 Areas of Focus for the Enhancement of China’s Industry Competitiveness During the 13th Five-Year Plan Period and Current Issues 203
5.3.1 Overall Roadmap and Key Areas of Focus for the Enhancement of Chinese Industry Competitiveness in the 13th Five-Year Plan Period 203
5.3.1.1 Technology Underpinning for the Transformation and Upgrade of Traditional Industries 203
5.3.1.2 Innovation Driving the Movement of Emerging Industries Towards the Mid-to-Top Tier of the Market 204
5.3.1.3 New Needs Leading to Development of the Modern Service Industry 205
5.3.1.4 Green Development “Trigger” for the Development of the Environmental Industry 206
5.3.1.5 Cooperation in Area of Production Capacity Growing Space for Industry Development 207
5.3.1.6 Leapfrog Development Integrated into Restructuring of the Global Industry Value Chain 208
5.3.2 Current Issues with Regard to the Task of Enhancing Industry Competitiveness in the 13th Five-Year Plan Period (2016–2020) 209
5.3.2.1 The Difficult Choice of Dismantling Overcapacity Amidst Downward Pressures in the Economy 209
5.3.2.2 Inadequate Innovation Makes for Emerging Industries with Little Competitive Edge 210
5.3.2.3 Inadequate “Effective” Supply from Industry-Side Means Enhanced Consumer Needs Cannot Be Transformed into New Engine of Economic Growth 211
5.3.2.4 Industrial Optimization and Upgrade Is Urgent in Light of Need for Better Environmental Quality 212
5.4 Ways to Enhance China’s Industry Competitiveness During the 13th Five-Year Plan Period (2016–2020) 213
5.4.1 Accelerate the Implementation of the Strategy of Innovation-Driven Development 213
5.4.1.1 Commitment to Theoretical Innovation as Guide 213
5.4.1.2 Commitment to Institutional Innovation 214
5.4.1.3 Commitment to Technological Innovation 214
5.4.1.4 Commitment to Cultural Innovation 215
5.4.2 Commitment to Cooperation Between Industries, Cooperation Between Industry and the City, and Regional Industry Cooperation 215
5.4.2.1 Coordinated Development of the Three Sectors 216
5.4.2.2 Promoting Harmonious Development Between Industry and City 217
5.4.2.3 Optimizing Regional Industry Cooperation 217
5.4.3 Promoting the Development of Green Industries in China 218
5.4.4 Commitment to Enhancing the Global Competitiveness of Industry Value Chains with Open Minds 219
5.4.4.1 The Free Trade Area Strategy 220
5.4.4.2 Belt and Road Initiative 220
5.4.5 Resolving the Issue of Overcapacity with the Idea of Sharing Economy 221
References 222
6 Corporate Level: New Driving Forces and Models for Enhancing the Competitiveness of Chinese Enterprises 224
6.1 Current Operational State and Competitiveness of Chinese Enterprises 224
6.1.1 Strategy to Build Strong Enterprises of Scale Bearing Fruit However, Issues Such as Blind Expansion and Structural Imbalance of Product Offerings Have Emerged Due to Inadequate Market Orientation
6.1.2 First Products, then the Enterprise: Enterprises “Going Global” Have Seen Their Channel Control Abilities Enhanced Significantly Thanks to International Mergers and Acquisitions 227
6.1.3 Investment in Innovation as Well as Activity in This Area Have Continued to Grow, with Lack of Innovation Capabilities Leading to Poor Innovation Outcomes 228
6.1.4 Standard of Management Rises Significantly, Product Quality and Innovation Levels Posing Issues for Brand Recognition on International Market 230
6.2 New Driving Forces for the Enhancement of Chinese Enterprise Competitiveness in the 13th Five-Year Plan Period (2016–2020) 233
6.2.1 New Pathways for Enterprise Transformation as Necessitated by Move Towards High End of Value Chain 233
6.2.1.1 A Technological Revolution and Innovation Model Centered on Global Networks of Innovation 233
6.2.1.2 Enhancing the Integrated Development Capabilities of Enterprise Manufacturing and Service Functions 235
6.2.2 A New Model of Enterprise Development Based on Low-Carbon Manufacturing 236
6.2.2.1 Promoting Low-Carbon Manufacturing, Building a Green Value Chain 236
6.2.2.2 Developing Low-Carbon Service Models for Energy-Saving Enterprises 238
6.2.3 Urbanization Opening Doors to New Areas of Enterprise Investment 239
6.2.3.1 Urbanization Leading to Rise in Investment in Multiple Areas 240
6.2.3.2 Urbanization Creating Foundation for Innovations in Enterprise Business Models 241
6.2.3.3 Urbanization Has Brought Forth Opportunities for Upgrading of Product and Service Standards 241
6.2.4 A New Business Environment Thanks to the Internet + 242
6.2.4.1 The New “Internet?+?Manufacturing” Environment 242
6.2.4.2 The New “Internet?+?Commerce” Business Environment 244
6.2.4.3 The New “Internet?+?Finance” Environment 245
6.2.4.4 The New “Internet?+?Entrepreneurship and Innovation” Environment 247
6.2.5 Globalized Business Management for the Development of New Markets 249
6.2.5.1 New Overseas Markets with the Belt and Road Initiative 249
6.2.5.2 Building Bridges and Platforms for Internationalization with Free Trade Areas 250
6.2.5.3 New Models of Innovation with Internet + 251
6.3 Safeguards for the Enhancement of Chinese Enterprise Competitiveness in the 13th Five-Year Plan Period (2016–2020) 252
6.3.1 Innovations for Convenient Financing 252
6.3.2 System and Mechanism Innovations for Greater Enterprise Vitality 253
6.3.3 More Market Stimuli to Grow International Cooperation 254
6.3.4 Optimizing Tax Policies and Stronger Support for Special Initiatives 255
6.3.5 Enhancing Talent Cultivation 255
References 256