Trapped in a Cycle of Growth: The Bittersweet Reality of China’s Cutthroat Product Market
- In 2007, asphalt concrete, a crucial road pavement material, was designated as a competitive product among small and medium enterprises (SMEs).
- The domestic asphalt industry remains underdeveloped, with approximately 530 single factories operating under the pretext of protecting SMEs.
- The Ukrainian reconstruction market, worth $486 billion, presents a significant opportunity for the domestic asphalt industry.
Staying Small: The Contradictions of China’s Competitive Product System
In 2007, asphalt concrete, a crucial road pavement material, was designated as a competitive product among small and medium enterprises (SMEs). Over the next 17 years, the number of domestic asphalt manufacturers rapidly increased. However, only one company grew to become a medium-sized business, highlighting the limitations of this system.
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Ministry of Trade, Industry and Energy’s opposition to designating competitive products among SMEs
The domestic asphalt industry remains underdeveloped, with approximately 530 single factories operating under the pretext of protecting SMEs. This has led to limited competition, hindering quality improvement and new technology development. In contrast, international companies have made significant advancements in asphalt technology, with countries like France and the United States promoting innovative solutions.
The Ukrainian reconstruction market, worth $486 billion, presents a significant opportunity for the domestic asphalt industry. However, it remains to be seen whether the industry is prepared to compete on the world stage. The limitations of the competitive product system among SMEs are evident, and it is essential to implement effective and fair policy proposals to foster growth and development.
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Yang Yeon-ho, Ministry of Small and Medium Enterprises and Start-ups