Currently, China’s per capita GDP is at a stage where we can observe that the nation is transitioning from a middle-income country to a high-income country. This further realization of Chinese-style modernization is inevitably accompanied by an increase in economic development and the upgrading of the economic structure. In terms of industrial structure, the tertiary sector now accounts for more than half of GDP (54.6% in 2023), indicating that the Chinese economy has effectively entered its post-industrialization phase. From the perspective of societal development patterns, as development levels continue to rise, so will grow the share of the service sector. Therefore, China must prepare to embrace a post-industrial society. Certain modes of thinking and behavioral habits formed during the industrialization period are increasingly incompatible with the needs of this new post-industrial phase. Without adjustments, the momentum of economic development will be constrained, and the people’s aspirations for a better life will continue to face limitations on the side of supplies.

The challenges posed by the post-industrial era to traditional ways of thinking and policy inertia are becoming more evident. Specifically, there are four cognitive dichotomies that contemporary China needs to avoid. These are: first, the opposition between manufacturing and services; second, the opposition between consumption and production; third, the opposition between online and offline; and fourth, the opposition between high-end and low-end sectors.

As the Chinese economy enters a post-industrial phase, new challenges require corresponding adjustments in various fields in practice, including public policies, social governance, and individual behaviors. Firstly, industrial policies should shift from standardized pre-emptive measures to more inclusive ones. Secondly, urban social governance needs to transition from a single, uniform approach to a diversified one. Thirdly, the urban spatial layout should shift from population dispersion to re-concentration. Finally, human development needs to move from emphasizing knowledge acquisition to focusing more on social skills and local experience.

In order to adapt to the advent of this post-industrial era, economic policies need to significantly deregulate the service sector. For the development of certain service industries that align with the Chinese people’s aspirations for a better life, restrictive policy measures should be reduced and blanket regulations avoided. Furthermore, this should all remain grounded in a strong foundation of the rule of law.

 

In terms of urban development, industrial policy should shift from focusing on selected industries and enterprises, and from subsidizing factor prices, to policies that incentivize technological innovation and comprehensively enhance the quality of urban life.

Regarding the restructuration of urban space, policies should accommodate the centripetal trend of employment and consumption concentrating in city centers by increasing housing supply in these central areas, raising population density, optimizing traffic flow, minimizing the distances and distinctions between work and home, as well as between living and recreational areas, and improving public transportation and spatial interaction in public spaces.

In terms of population policy, there is a clear urgency to intensify efforts to accelerate the integration of the floating population into urban communities, enabling them to secure stable employment and housing locally and thereby providing them with the necessary urban living experience for the development of the service industry.

In the education field, reforms should be deepened with an emphasis on cultivating social interaction skills, particularly in the areas of comprehension, expression, and communication, to foster common civic behavior among citizens.

Looking toward the future, China’s domestic strategy should focus on fully developing the service sector to address overcapacity issues in manufacturing and strengthen areas where the service industry is currently weak. Internationally, adapting to the growing global trend of trade in services is crucial. By further opening up its service sector, China can better meet domestic service demands while expanding its presence on the global stage. Particularly in the digital and platform economies, some Chinese companies have shown strong performance in international markets. Moving forward, China should aim to integrate its economy more effectively into the global market through a two-way opening up of service trade.

 

Two decades have passed since China joined the WTO, and the country’s agricultural production and food system have shown no signs of collapse. In fact, China has seen consecutive annual increases in food production since 2004, with the country maintaining since 2017 an annual food output of over 650 million tons for seven consecutive years. Although food imports have risen significantly, this has not made China completely dependent on exporting nations. Instead, it has, to some extent, bolstered China’s influence within the global food system. A typical example of this is how China’s agricultural imports have become a crucial bargaining chip in U.S.-China trade negotiations. Moreover, the Belt and Road Initiative has strengthened infrastructure and commercial ties across Asia, Europe, and Africa, creating new opportunities for agricultural investment and reshaping global agricultural supply chains and trade routes. Based on these developments, American scholar Philip McMichael suggests that, following 19th-century Britain and 20th-century America, a global food system centered on China may be emerging.

At least three key questions arise from the development of Chinese agriculture and food security over the past two decades. First, why has China’s agriculture and food production successfully avoided the pitfalls of globalization? Second, what are the defining characteristics of the globalized transformation of China’s food security strategy? Third, how does China’s new food security strategy affect “South-South relations,” and what significance does China’s food security model hold for other developing countries in the Global South?

Our main argument is that the “pitfalls of globalization” concept has significant theoretical flaws and cannot fully explain China’s development path. The most notable feature of China’s food security situation over the past two decades has been its global strategic transformation. The foundation of this successful transformation lies in the high level of domestic food production. This contrasts with the hegemonic positions of Britain and the United States in the global food system and with other East Asian countries like Japan and South Korea, which are highly dependent on imports. To a certain extent, China’s global food security strategy has contributed to the restructuring of the global food system, elevated the position of Southern countries within it, and weakened the control that Western agricultural exporter countries typically exert over the global food system.

Through over two decades of exploration and practice, China’s food security strategy has undergone a global transformation. It is important to note that although this globalized food strategy places significant emphasis on utilizing overseas agricultural resources, this strategy is based on a high level of domestic food production. With the assurance of domestic food production, China has the flexibility to adjust the types and quantities of imports and secure a favorable position in agricultural trade. China’s global food security strategy consists of the following six components:

 

1. Diversifying sources of food and agricultural imports.

2. Strengthening overseas infrastructure for food and agricultural imports.

3. Mastering modern agricultural technologies through research, acquisition, and transfer.

4. Encouraging overseas agricultural investment.

5. Participating and playing an active role in global food system governance.

6. Maintaining a high level of domestic food production.

The globalization transformation of China’s food security strategy has accelerated the restructuring of the global food system and strengthened the position of Global South countries within it, thereby reducing, to some extent, the control Western countries have historically enjoyed over the global food system. From 2000 to 2020, the share of food imported into China from the U.S., Canada, the EU, Australia, and New Zealand dropped sharply from 61% to 32%. This shift is due to the rapid growth in food and agricultural trade between China and non-Western countries, particularly those in the Global South. For instance, China signed a free trade agreement with ASEAN in 2002, leading to agricultural trade between China and Southeast Asian countries increasing from USD 9.2 billion in 2000 to USD 161 billion in 2020—an increase of nearly 17 times. In 2019, Southeast Asia ranked second (after Brazil) on China’s list of food and agricultural import sources, ahead of the EU, U.S., and Australia. Southern and emerging market countries, such as Brazil, have now become the primary sources of China’s food and agricultural imports.

The transfer of industrial chains and the restructuring of supply chains have become global focal issues in recent years. From “offshore manufacturing” to “friend-shoring,” geopolitical upheavals are reshaping the geographical landscape of the global economy. Beneath the surface, a structural driving force is at play: the sectoral decline of U.S. manufacturing and the efforts of successive U.S. administrations to revitalize it. In fact, these dynamics ultimately trace back to the expansion of industry and its varied effects.

China, possessing both the identity of a late-developing country and that of a global industrial powerhouse, is not only a recipient of industrial expansion but also faces the decision of whether to expand its own industrial reach. Industrial expansion and industrial catch-up have long been enduring themes in the history of industry, offering ample lessons on the backlash experienced by expanding countries. However, the interplay of market and geopolitical factors means that forcibly preventing industrial expansion can also lead to negative consequences. Perhaps, for countries caught in the middle, a cautious and selective approach to industrial expansion provides an effective balance between national economic security and the lofty ideal of harmonious international relations.

Making decisions within the constraints of limited resources is a fundamental aspect of strategic planning. Thus, the concept discussed later in this article can be alluded to as “strategic industrial expansion.” In a sense, the history of China’s industrialization is largely a story of strategic development. Following a phase of strategic cultivation, the challenge of strategic expansion will inevitably arise sooner or later.

Expansion and catch-up have long been enduring themes in the history of industry. Though clearly constrained by resources and energy, the most prominent aspect of industry is the knowledge and technology embedded within it. It is precisely because of knowledge and technology that some resource-poor countries and regions have developed strong manufacturing sectors, while some resource-rich ones are merely surviving by exporting raw materials. The acquisition and creation of new knowledge and technology are the driving forces behind industrial development and serve as the inherent mechanisms behind the geographic relocation of industries.

This type of relocation specifically represents a form of expansion. It is often initiated by advanced industrial countries or regions, as evidenced by the overseas investments of their multinational companies. In contrast, when less developed industrial countries or regions seek to acquire knowledge and technology, it typically involves their catch-up process. Industrial expansion and catch-up reshape the distribution of interests, and these adjustments often lead to disputes and conflicts.

Industrial expansion driven by practical motives may lead to practical, bitter real-life consequences for the expanding country. Precisely because it is motivated by these practical considerations, it can also be seen as an unavoidable result of specific practical constraints. From a strategic perspective, industrial expansion should follow the principle of maximizing benefits and minimizing harm, coordinating between reality and idealism. This can help to alleviate real-life pressures, avoid potential backlash, while ensuring that industrial expansion aligns with the ethical aim of building a higher-level community of humanity.

First, the uneven distribution of natural resources necessitates cooperation between industrial countries and resource-rich nations. In today’s increasingly complex industrial system, such cooperation leads to more extensive diffusion of knowledge and technology compared to the 19th century.

Second, from a geopolitical perspective, in an era when industrial nations can no longer rely on gunboat diplomacy to control resource-rich countries, cooperation between industrial and resource-rich nations must inevitably involve some degree of industrial expansion. This expansion is not only morally justified but also a political prerequisite for successful cooperation.

Finally, considering the size and capacity of recipient nations in industrial expansion is crucial, as this factor is closely linked to the expanding country’s military security. Emerging industrialized countries must carefully evaluate and analyze the industries and technologies they are diffusing, as well as the relevant conditions of the recipient nations. Otherwise, the same historical lessons may repeat themselves.

 

The development of new energy vehicle (NEV) technology has transformed the century-old automotive industry and reshaped the global automotive market. During the era of fuel-powered engines, China’s auto industry struggled to compete with the traditional automotive powerhouses. However, the rise of new energy technology has completely changed China’s position in the global market. China’s status has thus been elevated, no longer that of a follower but a leader. So, what exactly has driven the rapid rise of China’s NEV industry?

Industrial policy has played a crucial role in this process. However, industrial policy is far from static; from its formulation to implementation and subsequent adjustments, it involves a dynamic process of industrial governance. ¹ Decisions made within the industry, though seemingly driven by rational economic choices, are deeply intertwined with political activities. Every “rational” decision is shaped by the social interactions of all actors within the existing circumstances. The introduction of a new industrial policy can alter or even reshape the interest relations and market positions between incumbents and challengers in the market. ²The formulation of industrial policy is not a top-down process of unilateral decision-making, particularly when it involves new policies for industrial transformation. Instead, it is a process of active interest negotiation between multiple departments and various actors. Even during the implementation of the policy, different actors may make divergent “rational” choices, which can lead to deviations in policy execution that necessitate subsequent adjustments.

The development of China’s new energy vehicle (NEV) industry has undergone a shift from being driven by the central government, to being driven by local governments, and finally to being market-driven. Correspondingly, the governance system has evolved from vertical integration to a mix of competition and cooperation, and ultimately to full market competition. Throughout every stage, non-market governance based on administrative contracting and market governance based on competition have been intertwined.

In the early stages of technological exploration, to build industrial competitive advantages, the central government consolidated resources both within and outside the industry to achieve key technological breakthroughs through major special projects. It cultivated policy-driven markets to facilitate a leap from zero to one in technology. During the industrialization breakthrough phase, the central government elevated NEVs to the status of a strategic industry. This move subsequently engaged the active participation of local governments and further relaxed market entry restrictions, fostering a competitive landscape between traditional automakers and new players in the automotive industry.

During the phase of large-scale production, as the technology matured, the negative effects of policy guidance became increasingly apparent. Non-market governance tools, such as government subsidies and policies protecting infant industries, were gradually phased out, and a market governance mechanism was established, dominated by full competition.

Looking ahead, with advancements in technologies like intelligent driving, China’s NEV industry is poised for a new phase of restructuring. The European Union’s intention to delay green and low-carbon policies and increase scrutiny of Chinese NEV exports may impact China’s NEV exports. Additionally, tech giants like Apple shifting toward the intelligent driving sector presents new challenges to the intelligent development of Chinese NEVs. Consequently, China urgently needs to establish a new industrial governance model for the era of smart technologies, leveraging its policy coordination capabilities to effectively integrate non-market and market governance mechanisms.

_{[1] Gao Bo, The Secret of China’s Electric Vehicle Rise, Beijing Cultural Review, Issue 6, 2023.}

_{[2] Neil Fligstein, The Architecture of Markets: An Economic Sociology of Twenty-First-Century Capitalist Societies, translated by Zhen Zhihong, Shanghai People’s Publishing House, 2008.}