Liu Yangwei, the chairman of Foxconn, advocated for a regional manufacturing system centred on China in his address at the “Revival of Asian Manufacturing Industry” session of the Summer Davos Forum in Tianjin today. He emphasised the significance of the secondary sector, particularly manufacturing, as a stabilising societal force due to its vast employment potential.
In Liu’s perspective, the manufacturing sector plays an essential role in bolstering societal prosperity and individual wellbeing. He believes that Asia, as China’s neighbour, is uniquely placed to capitalise on China’s status as the world’s premier manufacturing base to foster regional manufacturing.
Post-pandemic economic recovery has ushered in a new phase characterised by the emergence of regional manufacturing, Liu posited. In this new epoch, novel business models are beginning to appear. One such model is ‘BOL’, an evolution of the familiar ‘BOT’ (build-operate-transfer) model, where ‘T’ for transfer is replaced with ‘L’ for localise. Foxconn has already initiated some cooperative plans utilising this model with the governments and local partners of Thailand, India, and Indonesia. Liu claimed this economic model presents an exciting opportunity for both China and other Asian nations.
In terms of future manufacturing trends, Liu suggested that with increased automation and intelligentisation in manufacturing, there would be a decrease in costs and an increase in sales, ultimately resulting in more employment. However, the nature of this employment would change from labour-intensive to intellectually-focused roles, making better use of human capabilities.
Despite this, Liu noted there are certain challenges that have yet to be overcome, specifically in the field of precision manufacturing, where robots cannot entirely supplant human labour.
Regarding Foxconn’s labour needs, Liu indicated that there has been a slight increase in manpower demand in recent years due to growing production output. As the shift from labour-intensive industries to technology-intensive industries continues, the younger generation is increasingly attracted to intellectual work rather than manual labour. In response to this shift, Liu called on governments to enhance education standards to equip the next generation with the necessary knowledge to keep pace with advancements in artificial intelligence and robotisation.