【COVID-19】疫情对产业发展既是挑战也是机遇 - 2020-02-28
Author: Rui Mingjie, Professor, School of Management, Fudan University
Under the strong leadership of the CPC Central Committee, the COVID-19 epidemic has been initially curbed, and prevention and control work has achieved periodic results. On February 23, at the conference on coordinating and advancing prevention and control of COVID-19, General Secretary Xi Jinping said that the epidemic is both a challenge and an opportunity for industrial development. Some traditional industries were hit hard, while emerging industries such as smart manufacturing, unmanned distribution, online consumption and health care have showed strong growth potential. China should take this as an opportunity to transform and upgrade traditional industries and cultivate and grow emerging industries.
The government plays an important role in stabilizing economic growth and employment. For the orderly resumption of work and production, the government has unveiled a series of policies, including financial support, tax rebates, unemployment relief, rent exemption and reduction, incentives for innovation, and use of online platforms. Beyond that, from the perspective of industrial development, it is essential to develop new infrastructure industries.
What are the new infrastructure industries?
Although there is still room for transformation and improvement of the existing infrastructure industries in China, supply has already exceeded total social demand in these fields. Therefore, the government’s direct investment should not be limited to the current infrastructure industries, but should be based on high-quality economic and social development towards the future, while focusing on new infrastructure industries.
In the process of epidemic prevention and control, modern communications, data and Internet information technology are increasingly playing an important role. For example, the Internet and 5G technology are used to support remote video diagnosis of critically ill patients. Mobile communications companies leverage data collection to issue the proof for individuals that they haven’t gone out during the 14-day quarantine period. People purchase daily necessities and face masks via online channels. Remote work and online education are also popular. These examples show that modern science and technology and high-tech industries have been fully embedded into people’s work and life, social communications, health and hygiene, leisure and entertainment, learning and education, etc. Some of these emerging industries may even become key infrastructure industries for future economic and social development.
Infrastructure industries are divided into two categories. One is the traditional infrastructure industries, which usually refer to transportation, roads, docks, ports, communications, energy, and water resources that provide comprehensive support to production and people’s lives. They are the key foundation for social development. The other is the new infrastructure industries, which refer to modern infrastructure industries that support high-quality development of the future society, meet the needs of people’s better lives, and aid the development of new intelligent industries. Some people have expressed it as “Cloud + Network + Terminal.” The “Cloud” refers to cloud computing, big data and other modes of information exchange and use. The “Network” refers to the Internet, the Internet of Things, the Industrial Internet, etc. The “Terminal” refers to various terminals and smart applications responsible for the input and output of user information. This expression makes sense, but fails to fully cover the connotation of the new infrastructure industries.
The new infrastructure industries can be explained in three aspects: “Hard, Soft and Connected.” “Hard” refers to the “hard foundation” for the development of all industries, represented by 5G communications, new materials, new energy, new transportation, etc. “Soft” refers to the “soft foundation” of industrial development, represented by big data, artificial intelligence, IT software, etc. “Connected” refers to the “interconnected infrastructure industries,” represented by the industrial Internet, smart Internet of Things and smart grid. The development and application of these new infrastructure industries will widely affect all aspects of people’s work and life, including the construction and operation of public health systems, community grid management, as well as education and knowledge dissemination. The new infrastructure industries have become the basis for determining the social, living, economic and industrial competitiveness in the world of future. They will also play a major role in supporting the transformation and upgrading of the current industries and the development of emerging industries in the future.
Three key areas in the development of new infrastructure industries
In the long run, the government’s direct involvement in the investment and development of new infrastructure industries can attract private-capital investment on one hand, thus expanding demand, increasing employment and stabilizing growth; On the other hand, it can lay a solid foundation for China’s high-quality economic and social development, people’s desire for a happy life, modernization of the country’s industrial system and the improvement of its international competitiveness. To promote the development of the new infrastructure industries, we can proceed from the following three aspects:
1. 5G communications
5G technology determines the clustering state and the future-facing nature of the new infrastructure. To develop 5G communications, we should not only enhance research and development of core devices at the core technology level, but continue to accelerate the construction of 5G base stations at the infrastructure level. Meanwhile, at the application level, we should deeply integrate 5G with intelligent application scenarios such as finance, trade and industrial interconnection.
For example, in terms of upper-stream infrastructure, 5G has created new demands for the technological development of the antenna industry, radio frequency industry and optical module/optical network industry. Compared with 4G technology, 5G’s spectrum efficiency will be enhanced by 5-10 times, which is set to have a profound impact on the construction of information infrastructure. In terms of the services provided by midstream operators, 5G brings a new business model to operators, who need to act as a good channel providing bandwidth and devise product offerings based on different bandwidth requirements. In terms of downstream terminals and applications: Due to its broad bandwidth, low latency and high reliability, 5G can promote the mass interconnection between human, machines and objects, and offer faster, reliable and ubiquitous connectivity for information consumption and the matching of supply and demand in the platform economy. The essence of the industrial Internet is digitalization, network and intelligence. 5G’s empowerment of the industrial Internet will give birth to a brand-new industrial ecosystem, and the integration of the duo will promote high-quality development of the manufacturing sector.
2. Artificial intelligence
Artificial intelligence is a strategic technology leading the future. Major countries and regions around the world have all upheld the development of AI as a major strategy to strengthen the nation’s competitiveness and promote economic growth. The development of AI should attach importance to its deep integration with manufacturing, finance, commerce, and the transportation sector, tear down the barriers of cooperation between traditional enterprises and AI-focused enterprises, and standardize data security at the same time.
With its development thus far, artificial intelligence has become the core driving force of a new round of scientific and technological revolution and industrial transformation, which is exerting profound influence on the world economy, social progress and people’s lives. The industrial chain of artificial intelligence includes basic support, key technologies and application scenarios. Among them, basic support refers to computer infrastructure services such as chips, sensors, data services and cloud computing. Key technologies of AI mainly stand for the still-evolving algorithms that include machine learning, computer vision, speech and natural language processing. The application scenarios of AI are very extensive, covering all fields of “intelligence +”, as well as robots, wearable devices and so on.
3. Big data
The big data industry includes research and development of big data technology products, industrial big data, big data used for different sectors, main architect of the big data industry, big data security and big data application. From the perspective of competition, the overall layout of the big data industrial chain is complete. Yet competition level greatly varies when it comes to certain segments. While there is high concentration of competition in the midstream segment of the industrial chain, the situation is more forgiving in downstream as a monopoly has yet to be formed. This represents the most promising area for domestic emerging companies. It’s foreseeable that nearly all industries will rely on analysis powered by big data. It’s hence imperative that we devote more research and development efforts to the application of big data analysis in order to achieve breakthroughs and development.
Generally speaking, big data can provide troves of data resources that serve as information bases for the decision-making of production and services. 5G technology stands to improve the speed of information transfer and provide technical support for data transmission; Artificial intelligence is technology for information-processing, which provides a more mature and scientific decision-making mechanism for data analysis and processing. The above three crucial new infrastructure industries and their industrial chains constitute the ecological structure of the new infrastructure industries and empower high-quality development in the era of digital economy. This ecological structure shows that we should not only work simultaneously on the three industries, but pay attention to the coordinated innovation and cooperation between the industries per se and their related fields. Only through this approach can we make it (the new industrial industry) the foundation for the high-quality development of China’s economy, society, industry and people’s livelihood.
