Chinese manufacturing has come a long way — and by some measures, it is stronger than ever. Whereas foreign-invested enterprises were the driving force behind China’s manufacturing exports 20 years ago, most of these firms are now leaving China, having lost their market share to domestic competitors. And these dominant Chinese companies are not limited to the low-value-added production of the past. They are global leaders in many high-tech industries, such as semiconductors and electric vehicles, where they hold an absolute price advantage.
Today’s China is reminiscent of Japan and South Korea in their heyday.
In the 1970s, Japan was producing high-tech products, including home appliances and automobiles, that outperformed American alternatives. And in the 1990s, South Korea emerged as a powerhouse in the electronics and automobile industries.
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