These days, China is narrowing its gap with South Korea at a rapid pace in the manufacturing sector by maintaining low labor costs and making huge R&D investments. Analysts say China is already ahead of South Korea when it comes to future technologies such as big data, autonomous driving and artificial intelligence.
The Korea Institute for Industrial Economics and Trade (KIET) announced on Jan. 20 that China accounted for 27 percent of the global manufacturing sector in 2017 whereas the ratio stood at 18.5 percnet in 2010. According to global consulting firm Deloitte’s 2016 survey that covered 563 manufacturers in 40 countries, China came in first with a score of 100 in terms of manufacturing competitiveness, followed by the United States (99.5), Germany (93.9), Japan (80.4) and South Korea.
According to the Korea Institute of Science and Technology Evaluation and Planning (KISTEP), South Korea was just one year ahead of China in the manufacturing sector in 2016. The gap had been 2.7 years in 2008, 2.5 years in 2010, 1.9 years in 2012 and 1.4 years in 2014. In 2017, 25 and 100 South Korean and Chinese companies put their names on the list of the top 1,000 R&D deals, respectively.
“China is increasing its presence in high-tech industries as well as conventional industries and it is enhancing its competitiveness based on continuous restructuring,” KIET explained, adding, “South Korea needs to get down to industrial reorganization and structural advancement right away.” Global manufacturing giants are already taking measures to enhance the competitiveness of their high-tech industries with the productivity of the global manufacturing sector predicted to fall. For example, Germany is moving ahead with Industry 4.0 for integrated and systematic technological innovation.