Editorial: South Korea's Struggle Against China's Industrial Supremacy

The Rise of China as a Global Manufacturing Powerhouse

Once, the UK, US, Japan, and Germany were considered the industrial powerhouses of the world, leading in key sectors such as automotive, electronics, and heavy machinery. Today, however, the landscape has shifted dramatically, with China emerging as a dominant force across all levels of manufacturing. From low-end industries like textiles to high-tech fields such as artificial intelligence (AI) and robotics, China is not just competing—it is dominating.

China currently accounts for 31% of global manufacturing output, more than double that of the United States (16%) and surpassing the combined share of countries like Japan, Germany, India, South Korea, and others. Within this vast manufacturing sector, China holds significant market shares in various industries. It controls 70% of the drone market, 60% of the electric vehicle market, and 70% of the shipbuilding market. Its influence stretches from traditional sectors like sewing to futuristic domains such as AI and robotics.

The Resurgence of the Sewing Industry in China

One of the most surprising developments is the revival of the sewing industry in China, which had previously been shifting production to countries like Vietnam and Bangladesh. Companies like Alibaba have played a pivotal role in this transformation through projects such as the “Smart Garment Factory.” This initiative uses AI to analyze sales data and predict which designs will be successful, streamlining production planning. In factories, AI-powered robots cut fabric with near-perfect accuracy and rapidly produce clothing. Alibaba has also introduced a “See now, Buy now” model, allowing new products to be released weekly.

Shein, another major player, takes this concept even further. By leveraging AI, it analyzes real-time trends and generates over 1,000 designs daily. It then produces small batches of 100–200 pieces and uses AI to forecast demand before scaling up production for popular items. This has led to the realization of “inventory-free production,” where tens of thousands of garment factories in Guangdong and Zhejiang now compete based on data and speed rather than labor costs.

Logistics and the New Era of Efficiency

Logistics companies like SF Express are also playing a crucial role in China’s manufacturing dominance. Through AI, they optimize delivery routes and use robots to sort and package goods around the clock. This has ushered in what some describe as the “new logistics era,” driven by tech giants like Alibaba and SF Express.

The garment industry serves as a symbol of China’s comprehensive manufacturing capabilities. From low-cost mass products like vitamin C raw materials and bicycles to high-end appliances and green energy sectors like solar panels, China holds dominant positions in hundreds of industries. It is no exaggeration to say that modern life globally cannot function without Chinese products.

China's Expansion into High-Tech Industries

In every industry, China floods the market with near-comprehensive products. For instance, in the drone sector, it produces and controls a wide range of applications—from pesticide spraying and seed planting to construction and high-rise window cleaning. Military drones are just one part of this expansion. Similarly, robots are moving beyond factory settings into surgical assistants and caregiving roles. The world’s dependence on China’s manufacturing prowess continues to grow.

Impact on South Korea

South Korea has become one of the biggest victims of China’s manufacturing dominance. Many sectors where South Korea once excelled—such as steel, petrochemicals, and semiconductors—are now under threat. POSCO’s FINEX technology, once a global leader, has been quickly matched by Chinese companies using similar methods. In petrochemicals, South Korea faces an unprecedented crisis as China expands its production capacity. Market shares in automobiles, shipbuilding, and smartphones have already declined, and China is rapidly entering areas where Korean firms were once dominant.

Even in memory semiconductors, China is threatening Samsung Electronics and SK Hynix in 3D NAND flash. By poaching Korean engineers with high salaries, China has narrowed the technology gap, leading to the loss of OLED technology, which South Korea commercialized first.

The Necessity of Manufacturing

We cannot abandon manufacturing. Arguments suggesting a shift to high-value industries or services by discarding manufacturing are outdated. The issue is not just about job creation or value addition; without a strong manufacturing base, we cannot keep pace with the Fourth Industrial Revolution. Even if AI designs smart factories, there must be facilities to implement and produce them. Data generated from these processes, in turn, enhances AI capabilities.

South Korea’s manufacturing sector boasts world-class artisans who have built the “Made in Korea” legacy over decades. Their tacit knowledge—such as a master welder’s precision or a veteran engineer’s expertise—cannot be easily replicated through money or manuals. It is a heritage passed down through generations.

Awakening the Manufacturing DNA

Ultimately, we must awaken and develop the manufacturing DNA within us. We need to AI-ify the skills and spirit of these masters. Projects like POSCO’s “Lighthouse Factory” exemplify this approach, capturing artisans’ movements with sensors and vision AI to teach robots and digitize problem-solving processes. This must spread across all manufacturing sectors. New motivation must also be injected into research labs and production sites.

China does everything and will not change. This means we cannot avoid it. Then, the only option is to fight and win.