China's Industrial Policy Plan: Made in China 2025

Erik Wernberg-Tougaard

Student thesis: Master thesis


This thesis investigates China’s industrial policy (IP) plan Made in China 2025 (MIC2025). Through a disciplined interpretive case study of MIC2025, it explores the industries, actors, objectives and targets of the plan, the key factors that have led to the emergence of the plan and the IP-instruments employed in its implementation. A multiple case-study of three industries covered under MIC2025, shows how the plan is implemented at the industry-level and what outcomes can be observed across these industries between 2015 and 2019. As its theoretical framework, the thesis employs the debate about IP and the role of the state in structural transformation. The thesis has five main conclusions: Firstly, it is concluded that MIC2025 follow a top-down policy approach to make China a technological superpower by focusing on ten key industries. Bottom-up dynamics, however, remain weak, resulting in a limited coordination between central and local government. Secondly, it is concluded that several domestic, regional and global factors have led to the emergence of MIC2025 including (i) a surge in Asian IP plans, (ii) a high dependency on imports, (iii) the middle-income trap, (iv) the fourth industrial revolution, (v) regional and global competition, and (vi) China’s position in global value chains. Thirdly, the thesis finds that the debate on MIC2025 within China is multifaceted with differing views on the degree to which the state should engage in IP. Fourthly, the thesis finds that MIC2025 combines a range of highly diverse horizontal and vertical IP-instruments in its implementation, and that especially government-guided funds, SOE’s and large state-owned banks are important actors of the plan. The industry-level multiple case-study reveals that some overlap exists between the policy instruments applied across industries, while others are industry-specific. Finally, the outcomes observed across the three industries are to some extent in line with the objectives set under MIC2025 as of 2019, but the overall efficacy and success of MIC2025 remains to be seen. At a more general level, the thesis contributes to the understanding of how IP is made in emerging economies, and what characterises such policies. MIC2025 exemplify the increasing complexity found in IP-making today and underscores the increasing role of global value chains and the fourth industrial revolution on IP formulation in emerging economies today

EducationsMSc in International Business and Politics, (Graduate Programme) Final Thesis
Publication date2020
Number of pages105
SupervisorsKjeld Erik Brødsgaard