China’s journey to global manufacturing domination

China

A former Rio Tinto executive has written a report chronicling the rise of China’s industrial sector, one foreign factory at a time.

Michael Komesaroff has written a report titled Make the Foreign Serve China, where he recounts China’s purchase of numerous unwanted factories from Australia, the US, Japan, Germany, Britain and other developed countries.

According to Komesaroff, the nation proceeded to dismantle these factories, ship them back to China and reassemble them.

Essentially, China’s strategy was to (legally) take technology from the west, and use it as a leg up to build what is now a flourishing industrial sector, according to the report.

Komesaroff detailed an Australian example – China’s purchase of Rio Tinto’s revolutionary iron ore smelting technique, HIsmelt.

According to Komesaroff, Australian taxpayers and government funding contributed a combined $155 million to Rio Tinto’s demonstration plant in Kwinana, Perth. The plant was developing HIsmelt, a smelting technique with commercial and environmental advantages over the traditional smelting process.

However, when the financial crisis hit in 2008, the company decided to abandon the development of HIsmelt, and sold the plant to a Chinese firm.

Its components were disassembled, shipped to China and reassembled as Molong Petroleum Machinery, which intends to use HIsmelt technology to make high-quality, specialised pipes for the global oil and gas industry.

According to Komesaroff, this is just one example (with many other similar stories) of how China capitalised on western technology to become an industrial superpower.