China’s Pivot Towards High-End, High-Margin Exports: A Strategic Shift in Global Trade

[Beijingwalker]

China’s Pivot Towards High-End, High-Margin Exports: A Strategic Shift in Global Trade​

By: Aqsa Younas Rana
Published: December 23, 2023 at 11:21 pm EST | Updated: Dec 23, 2023 at 2:49 am EST


In a strategic pivot that marks a significant shift in its export economy, China is setting its sights on high-end, high-margin products, moving away from the low-profit, high-volume goods that have historically dominated its export framework. This move is spurred by a desire to climb up the value chain and establish a stronghold in advanced industries.

A Profound Economic Transformation​

China’s economic transformation is a calculated bid to increase the profitability of its companies and expand its global economic influence. The stark contrast between the profits from exporting vast quantities of low-margin goods like textiles and the profits from selling a single high-end product like a Boeing aircraft underscores this shift. The former, despite its massive scale, fetches much less profit, prompting China to venture into high-end, high-margin exports.

Insights from the #GTAnnualConference2024​

This strategic pivot was discussed by Robert Lawrence Kuhn, chairman of the Kuhn Foundation, at the #GTAnnualConference2024. His observations align with the current discussions and future projections about China’s economic policies and export strategies. He noted that China aims to boost high-tech sectors and advanced manufacturing development by 2024 to ensure high-quality growth.

Implications and Challenges​

While this shift towards high-end, high-margin exports is promising, it also presents a set of challenges. For instance, the decarbonization of the steel industry, a critical component of advanced manufacturing, continues to be a leading topic. With the global shipping industry facing a tighter supply of ships leading to delays and price spikes, the transition to high-profit goods will not be without its hurdles. However, these challenges are unlikely to deter China from its mission to ascend the value chain, with the nation demonstrating resilience and adaptability in its economic strategies.

China's Pivot Towards High-End, High-Margin Exports: A Strategic Shift in Global Trade

China is shifting its export strategy to focus on high-end, high-margin products as part of its economic transformation to climb up the value chain and become a leader in advanced industries.

bnnbreaking.com

 

[VCheng]

In a strategic pivot that marks a significant shift in its export economy, China is setting its sights on high-end, high-margin products, moving away from the low-profit, high-volume goods that have historically dominated its export framework. This move is spurred by a desire to climb up the value chain and establish a stronghold in advanced industries.

I am considering getting a 3D printer, and currently, the best products are from China, with many excellent options. The same has already happened with drones. This can only be a good thing for consumers globally.

 

[Beijingwalker]

I am considering getting a 3D printer, and currently, the best products are from China, with many excellent options. The same has already happened with drones. This can only be a good thing for consumers globally.

For electronics, US and Japan had already given up, Korea is the next down the line

 

[VCheng]

US and Japan had already given up

Given up? Like, closed up shop and gone home? Or, are they still working hard and trying to compete?

 

[Beijingwalker]

Given up? Like, closed up shop and gone home? Or, are they still working hard and trying to compete?

The chart is about electronic manufacturing, You talked about 3D printers, they used to be dominated by the west barely a decade ago, not anymore.

 

[VCheng]

The chart is about electronic manufacturing, You talked about 3D printers, they used to be dominated by the west barely a decade ago, not anymore.

Of course China's products in this area are now competitive, but I found your statement that USA and Japan "have given up" simply false hyperbole.

These are small devices for home use I was referring to, and not the starting commercial products even at the lowest end of the scale. May be that will happen in the future, but not yet.

 

[Beijingwalker]

Of course China's products in this area are now competitive, but I found your statement that USA and Japan "have given up" simply false hyperbole.

Hopefully they can pick up the global share on that sector, we'll see.

 

[VCheng]

Hopefully they can pick up the global share on that sector, we'll see.

Yes, we will see. Until then, all shops remain open.