China is reportedly preparing a new version of its “Made in China 2025” initiative, aimed at enhancing the production of advanced technological goods, according to sources familiar with the matter.

The updated plan may adopt a different name to mitigate international criticism and will likely focus on areas such as chip-making equipment.

These discussions are part of broader preparations for China’s next Five-Year Plan, which is set to begin in 2026.

Policymakers aim to sustain the manufacturing sector’s share of the national economy while balancing other economic objectives.

Officials are considering whether to establish a specific consumption target within the plan but remain cautious due to limited means to encourage household spending.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ China’s industrial strategy reflects deep historical continuity beyond “Made in China 2025”

China’s manufacturing strategy follows a consistent pattern dating back decades, with “Made in China 2025” representing just one chapter in a much longer narrative of state-directed industrial development.

The philosophy of “Chinese learning for essence, Western learning for use,” articulated by 19th-century official Zhang Zhidong, continues to influence China’s pragmatic approach to foreign technology and knowledge today 1.

China’s manufacturing value-added reached $4.66 trillion in 2023, accounting for 29% of global manufacturing output, demonstrating the success of its long-term industrial policies 2.

This consistency explains why Beijing is likely to maintain its core manufacturing strategy despite international pressure, as manufacturing remains central to both economic stability and national security objectives.

The upcoming Five-Year Plan continues this pattern, with manufacturing’s share of GDP likely to remain stable rather than declining.

2️⃣ China’s manufacturing evolution creates new global trade dynamics

China’s export share of GDP has declined significantly from a peak of 64% in 2006 to 33% today, reflecting a major shift in its economic model 3.

Despite this decline in export dependency, China still dominates production in strategic sectors, controlling approximately 71% of global production in electric vehicles, solar panels, and lithium batteries 4.