forum. The health crisis of 2020 has suddenly highlighted the dependence of many countries on the Chinese economy, especially in strategic areas such as the pharmaceutical and chemical industries. It is also the economic and diplomatic tensions with China that are driving certain Western countries-the United States since 2018, most recently Australia, the United Kingdom, Canada, and the European Union (EU)-to consider a gradual Brexit strategy for China’s economy.
Therefore, shifting the production chain outside China may intensify the Sino-US trade war on tariffs and trade restrictions. How does China adapt to these possible changes?
Approximately 30% of China’s exports are carried out by foreign companies, while 10% are carried out by joint ventures that link foreign and Chinese companies: therefore, China’s economy largely depends on the establishment of foreign companies within its borders. Stimulated by the transfer of foreign companies, the potential transfer of China’s overseas production chain will affect its economic activities and technological innovation.
However, a few years ago, China’s economic development entered a new stage, and its production system has changed. The increase in Chinese wages is driving the production and production of Chinese or foreign companies in other countries (such as Bangladesh, Ethiopia, and Vietnam), mainly in labor-intensive sectors, while the production of increasingly complex products and services is developing in the Chinese territory on.
Since the mid-2000s, the share of foreign value added in China’s exports has dropped significantly, especially in the fields of electronics, information and communication technology.