Manufacturing News

China seen as indispensable to global supply chain

China is indispensable to the global supply chain and closer cooperation is a win-win choice, executives of multinational corporations, economists and officials said.

Airbus, for example, said its cooperation with Chinese companies covers the entire industrial chain, from procurement, production and installation of large components to aircraft final assembly and delivery, and the company has benefited from such close ties in its business expansion.

George Xu, CEO of Airbus China, said in an exclusive interview last month: "In the past, we had to ship all the big parts from Europe, which took 60 days. (Later), we worked with a Chinese partner, the Aviation Industry Corp of China, to produce the parts locally and deliver them 'door to door' to our Tianjin final assembly line."

"The locally made parts are comparable to those made in Europe in terms of both quality and costs," said Xu.

Currently, Airbus has about 200 suppliers in China, and components produced by Chinese companies are found on all Airbus commercial jetliner types.

Thanks to strong local suppliers and a stable regulatory environment, the building of the second line of the Airbus A320 family Final Assembly Line Asia in North China's major industrial port city of Tianjin is in full swing.

Juan Tubio, general manager of FALA, said: "(There is) a very stable regulatory environment around us. The Tianjin Free Trade Zone umbrella is helping us to work in very close collaboration and discussion with Tianjin Port and Tianjin Customs."

"We are now building the second assembly line that will be entering into service in late 2025, and in theory, doubling our capacity in Tianjin," he said.

Apple CEO Tim Cook also reiterated the company's long-term commitment to the Chinese market during his visit to Shanghai last month.

"There's no supply chain in the world that's more critical to us than China," Cook said, noting that Apple will strengthen its long-term cooperation with its Chinese supply chain partners and work closely with them on green and smart manufacturing to achieve win-win results.

Data showed that 151 of Apple's 200 major suppliers have production activities in China.

Earlier in March, Apple announced that it would expand its applied research lab in Shanghai and establish a new lab in Shenzhen, Guangdong province, later this year.

To boost global supply chain cooperation, China will hold the second China International Supply Chain Expo in November this year after the first CISCE was successfully held in Beijing last year.

Ren Hongbin, head of the China Council for the Promotion of International Trade, said that an exhibition area for advanced manufacturing would be added to the second CISCE.

The new exhibition area will focus on new quality productive forces from perspectives including front-end research and development and design, application of new materials, processing of key components and smart manufacturing, said Ren.

Besides the new exhibition area, the second CISCE will also have exhibition booths categorized into various sections, including clean energy, smart vehicles, digital technology, healthy lifestyles, green agriculture and services for supply chains.

"Today, China is indispensable for the world. It is impossible to isolate China, although there are such attempts," Kresimir Macan, a Croatian political and economic expert, said in a recent interview.

"Attempts to decouple or de-risk from China will eventually backfire on those who impose them," said Macan.

China remains a crucial trading partner for most countries worldwide despite so-called decoupling from China, according to the Asian Development Bank.

"China's still probably the number one trading partner for the majority of countries in the world," ADB Chief Economist Albert Park was quoted as saying by CNBC. "The story of China being delinked from the global economy, I think those are probably generally very overdone or very partial."

China's gross domestic product grew 5.2 percent year-on-year to a new high of 126.06 trillion yuan ($17.4 trillion) last year, and the country seeks to achieve a GDP growth rate of around 5 percent this year.

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