By Sun Zhiyan, Research Department of Development Strategy and Regional Economy, DRC

Research Report, No.57, 2021 (Total 6122) 2021-3-17

Abstract: Under the impact of the third technological revolution and the spreading of COVID-19 pandemic in the world, the restructuring of global value chains has gained further momentum, and how to cope with the challenges induced by the restructuring has drawn wide attention. By focusing on an analysis of the essential characteristics of global value chains restructuring and the economic digital transformation, this paper gives an illustration of China’s potential advantages and relevant policy options. As the world’s second largest economy with a large population, China enjoys distinctive advantages in terms of labor cost, the number of high-skilled professionals, the sources of energy, digital infrastructure and supersized data centers, and all of which are conducive to the formation of first-mover advantages and network cluster advantages for China in digital restructuring of global value chains. Therefore, we need to take an objective and rational view on the rise of labor costs at the present stage, and the policy focus needs to shift to the optimization of personnel composition and the cultivation of more professionals with high academic credentials. We also need to step up the improvement of policies related to data advancement, and build a more integrated spatial system for the development of green energy and digital infrastructure, so as to build an ecological environment for the development of digital economy.

Keywords: global value chains, digital economy, advantage of a big country