Abstract

China has experienced not only high rates of economic growth as well as an unprecedented competitive international ion since the turn of the century. This process was not guided solely by market forces or influenced by government intervention in the economy. Although much has been argued that China’s “going global” strategy is rooted in state action, and especially its policy of exchange rate depreciation and trade policy incentives for exports and investments abroad, we argue that the major determinant of this strategy, which established the basic conditions for industrial competitiveness, was its industrial policy. The focus of this article is on the changes in China’s industrial structure, emphasizing that Chinese industrial policy is a central determinant of its international ion strategy.

JEL Classification: O21; O25.