High-tech at the heart of China's economic revival

Editor's note: Li Haoran is an assistant professor, Yan Yan is a graduate student, and Guo Bowei is an associate professor at the School of Applied Economics at Renmin University of China. The article reflects the authors' opinions and not necessarily the views of CGTN

Resilience and rapid recovery

China's manufacturing sector has shown remarkable resilience in a complex and shifting global environment. This resilience is most visible in high-tech manufacturing, which has become the driving force behind industrial upgrading, technological innovation, and green transformation. As the backbone of high-quality economic development, high-tech manufacturing has strengthened national competitiveness and secured China's position in global value chains.

Recent data highlight this momentum. Since early 2025, manufacturing has steadily recovered, with high-tech industries expanding at a rapid pace. In August, value-added output in high-tech manufacturing grew 9.3 percent year-on-year, contributing 28.5 percent to the country's overall industrial growth. Semiconductor equipment manufacturing skyrocketed 105.1 percent, while electronic circuit and integrated circuit production increased 43.1 percent and 42.2 percent, respectively — clear signs of accelerated breakthroughs in core technologies. Server production jumped 86.2 percent, and mobile base station output rose nearly 50 percent, fueling the rollout of 5G smart devices. Profits are also rising: In July, overall manufacturing profits increased 6.8 percent year-on-year, while the high-tech manufacturing profits surged 18.9 percent — well above the sector average, underscoring its strength and competitiveness.

The engines of China's tech renaissance

This rebound is not only about scale; it represents a qualitative leap forward. High-tech manufacturing is driving industrial upgrading, optimizing resource allocation, modernizing supply chains, and accelerating the transition to advanced, intelligent production systems. By transforming traditional industries and generating new growth drivers, it is reinforcing the foundations of the real economy and moving China further up the global value chain.

Policy support has played a pivotal role. National strategies such as Made in China 2025 have set priorities in next-generation information technology, advanced equipment, and aerospace. Targeted industrial policies have spurred growth: Subsidies and tax incentives have helped create the world's largest EV market; AI initiatives have advanced smart factory applications; and semiconductor-focused policies, including the national IC fund and R&D subsidies, have strengthened self-sufficiency. Complementary fiscal and financial measures — such as super-deductions for R&D expenses, tax breaks for high-tech firms, and expanded credit channels — have lowered costs and broadened access to financing for innovation-driven enterprises.

In addition to the policies, market-based mechanisms have also boosted innovation. Carbon markets and green finance have encouraged energy-saving processes, while innovation platforms have connected universities, state-owned enterprises, and private enterprises to accelerate breakthroughs in cutting-edge technologies. This mixed model of industrial policies and market forces has created a self-sustaining cycle of technological progress.

Talent and institutional frameworks have provided long-term momentum. Expanded engineering and vocational training programs, coupled with efforts to attract global researchers, have helped address critical skill gaps. At the same time, stronger intellectual property protection and fair competition policies have accelerated the commercialization of research achievements, fostering a complete innovation ecosystem.

From Beijing to the world: High-tech's ripple effects

The rise of high-tech manufacturing carries broad implications. Domestically, it reinforces supply-chain security, boosts self-reliance in critical technologies, and reduces "bottleneck" risks in strategic sectors. It also plays a vital role in achieving China's "dual carbon" goals by supporting the production of clean energy equipment, electric vehicles, and advanced storage systems.

Globally, China's progress acts as a stabilizing force. As one of the largest suppliers of solar panels, EV batteries, and telecommunications equipment, China helps lower the cost of green technologies and makes the global energy transition more affordable. Expanded capacity eases supply-chain bottlenecks that have disrupted international markets in recent years. Cross-border collaboration — through joint research centers, international standards, and technology licensing — ensures that innovation benefits spill over to other economies, fostering shared opportunities for sustainable growth.

Sustaining growth in a shifting world

The challenge now is to ensure sustainable growth. Enterprises must continue investing in core technology R&D, deepen digital transformation, and embrace flexible production to enhance efficiency. Strengthening collaboration with suppliers, customers, and research institutions will build resilience, while greater participation in international standard-setting and diversification of global markets will bolster competitiveness and mitigate geopolitical risks.

Taken together, these developments show that high-tech manufacturing is not only driving China's current industrial profit recovery, but also laying the groundwork for its next phase of economic transformation. By advancing innovation, upgrading industry, and reinforcing supply-chain security, it is becoming a strategic pillar of China's rise and a catalyst for global growth in the coming years.