Wanted: World's best companies
Updated: 2015-09-18 07:44
By Cecily Liu(China Daily Europe)
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China must reach out with an inclusive mindset to reap the rewards of working with first-rate firms
The next phase of China's economic growth is expected to be driven by advanced manufacturing, but the industries involved often require a significant degree of internationalization to achieve competitiveness, says Keith Burnett, vice-chancellor at the University of Sheffield in England.
Such internationalization means China needs to incorporate companies comprising the world's best supply chain into each of its advanced manufacturing sectors. Such a process demands that China internationalize with a cooperative and inclusive mindset, says Burnett.
Keith Burnett says he doesn't like the thought that China just replicates a Western life, as that's not how it should be. Cecily Liu / China Daily |
"If you look at how China has evolved as an economy, it started with a myriad of products with the lowest possible capital equipment, and then manufacturing gradually moved up the value chain," Burnett says.
"But going into the future, China needs a big component of the economy in advanced manufacturing with the highest value like high-speed trains and aircraft, otherwise you'd be buying these from other countries while making lower value-added products."
Burnett became the vice chancellor at the university in 2007. He is also a leading figure in the United Kingdom's science field, being a member of the Council of Science and Technology who was awarded a knighthood in 2013 for his services to science and higher education.
Having discovered an interest in China during his first visit 10 years ago, Burnett has since visited the country many times, and has learned to speak some Mandarin.
But his work has made his connections with China even closer, especially through his involvement with the Nuclear Advanced Manufacturing Research Center. The Nuclear AMRC, led by the universities of Sheffield and Manchester, was established in 2009 to help the UK's nuclear industry firms improve their technology through research and development and expertise sharing.
The Nuclear AMRC is in discussions with Chinese nuclear firms about helping it localize its technology, and in the process incorporate aspects of the British supply chain for both the UK market and later for potential export.
China General Nuclear Power Group and China National Nuclear Corporation are exploring the possibility of building the first nuclear plant in the UK using Chinese indigenous design.
The site is at Bradwell, in Essex, and cooperation between the Chinese firms and British partners is expected to be important agenda point for UK Chancellor George Osborne's China visit in late September.
If the Bradwell project is successful, Chinese nuclear technology would receive a huge stamp of confidence in the international community, because the UK's regulations for nuclear power are strict and of a high standard. It would pave the way for Chinese investment in other mature economies.
The nuclear sector is perhaps one key example of how Burnett imagines China should internationalize its advanced manufacturing industry for global export. Other industries that China could internationalize in the same way include the high-speed trains and aerospace industries.
"The reason it makes sense to internationalize these industries is that many of the complex requirements of these products are global, so aerospace is a classic example because the aircraft need to comply with regulations globally," he says.
In the process of internationalization, Chinese companies would gain extensive understanding of international markets, and at this stage it would make sense to contract some component work to leading international firms, or locate their research and development centers for certain aspects in another country that has the experience and the human resources to do it, he says.
"In an open economy, if you don't have the best products you won't sell, and making the best products means to have the best industry expertise being put into your supply chain."
Inevitably, China will need to share ideas with partners internationally and share profits with them, too. "Internationalizing means you will lose some ideas to people, but it will allow you to grow faster," he says.
This is the road China is already taking. For example, its high-speed train companies and aerospace firms have already established R&D laboratories inside UK universities, funding research on the latest cutting edge technology in each sector and incorporating the resulting new technology into their products.
China Railway Rolling Stock Corp, China's largest high-speed train manufacturer, established agreements this year with three universities in the UK to build R&D centers. They are conducting research into the latest train technology to help the company improve domestically and in international markets.
Burnett says internationalizing requires an inclusive attitude, especially given that many Chinese companies are seeking help and advice from overseas partners. "It won't work if you say to international partners, 'We want to internationalize and take away your business.' But you'll get a lot of support by saying, 'If we work together we can make things the world wants to buy.'"
If China takes this attitude, it will have an accelerated pace of development and quickly generate lessons applicable for many advanced economies in the world, he says. The issues China encounters during its development will motivate the country to develop new ideas.
Burnett, born in 1953 in the Rhondda Valley in Wales, studied physics at the University of Oxford. He held academic positions in physics at the University of Colorado, Imperial College and Oxford before joining the University of Sheffield.
He went to China for the first time around 10 years ago, accompanying a scholar from Oxford who is an expert in Chinese bronzes and was looking for material for an art project.
"I was entranced by this great, wonderful country. I started learning a bit of Mandarin. It's not very good but I really love it. I also have a Chinese family as my daughter-in-law is Chinese," he says.
Burnett says he thinks China should consider its current challenges as opportunities to develop pioneering solutions, as opposed to having to catching up with the West as its ultimate goal.
"I'd love to see China focus on some of the big problems facing the world. We could have a set of new economic development ideas or environmental solution ideas China develops provide inspirations for the world," Burnett says.
"China cannot just repeat what the West has gone through. It would be a shame if one has gone through all the suffering and sacrifice to build a modern China, and it's all just for a copy of Western consumer society, which is attractive but fundamentally flawed.
"I suppose I really don't like the thought that China just replicates a Western life. That's not how it should be. That's not how the world should survive," he says.
cecily.liu@chinadaily.com.cn
( China Daily European Weekly 09/18/2015 page32)
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