Theindustrial sector comprised 36.5% of thegross domestic product (GDP) of thePeople's Republic of China in 2024.[1] China is the world's leading manufacturer ofchemical fertilizers,cement andsteel. Prior to 1978, most output was produced bystate-owned enterprises. As a result of theeconomic reforms that followed, there was a significant increase in production by enterprises sponsored bylocal governments, especiallytownships andvillages, and, increasingly, byprivateentrepreneurs andforeign investors, but by 1990 the state sector accounted for about 70 percent of output. By 2002 the share in gross industrial output by state-owned and state-holding industries had decreased with the state-run enterprises themselves accounting for 46 percent of China's industrial output. In November, 2012 theState Council mandated a "social risk assessment" for all major industrial projects. This requirement followedmass public protests in some locations for planned projects or expansions.[2]
Chinaranks first worldwide in industrial output. Major industries include mining and ore processing;iron andsteel;aluminium;coal;machinery;armaments;textiles andapparel;petroleum;cement;chemical;fertilizers;food processing;automobiles and other transportation equipment including rail cars and locomotives, ships, and aircraft;consumer products includingfootwear,toys, andelectronics;telecommunications andinformation technology. China has become a preferred destination for the relocation of global manufacturing facilities. Its strength as an export platform has contributed to incomes and employment in China. The state-owned sector still accounts for about 40% of GDP. In recent years, authorities have been giving greater attention to the management of state assets—both in the financial market as well as among state-owned-enterprises—and progress has been noteworthy.[citation needed]
Following theestablishment of the People's Republic of China in 1949, the government implemented aSoviet-stylecentrally planned economy, prioritizingheavy industries such as steel, coal, andmachinery.[3] TheFirst Five-Year Plan (1953–1957), with technical and financial support from the Soviet Union, led to significant industrial growth and the formation of a basic national industrial framework.[4] During this period, 156 major industrial projects were launched, including large-scale enterprises inmilitary production,metallurgy,chemicals, machinery, andenergy.[4] These efforts aimed to build a relatively complete industrial base and modern national defense system, significantly raising China's industrial capacity and technological level to one comparable with that ofadvanced countries in the 1940s.[4] However, the system was characterized by high input reliance, low efficiency, and imbalanced output structures, including chronic overproduction in some sectors.[5]
Since the founding of the People's Republic, industrial development has been given considerable attention. Article 35 of the 1949Common Program adopted by theChinese People's Political Consultative Conference emphasized the development of heavy industry, such as mining, iron and steel, power, machinery, electrical industry, and the chemical industry "in order to build a foundation for the industrialization of the nation."[6]: 80–81
Between 1958 and 1962, theGreat Leap Forward aimed to accelerate industrialization through rural collectivization and mass mobilization.[7] This campaign caused severe disruptions to bothagriculture and industry, and is widely associated with a majorfamine that resulted in tens of millions of deaths.[7] The subsequentCultural Revolution (1966–1976) further destabilized the industrial sector, as many technical experts and administrators were purged, leading to administrative paralysis and production inefficiencies.[5]
Despite these setbacks, China had, by 1978, developed a foundationalindustrial base dominated bystate-owned enterprises in sectors such as chemicals, metallurgy, and machinery.[5] Industrial growth during the 1957–1978 period averaged approximately 8.8 percent annually, though growth rates fluctuated considerably from year to year.[5] According to scholars, persistent inefficiencies within thecommand economy model contributed to the eventual launch ofeconomic reforms at the end of the 1970s.[5]
During theThird Five-Year Plan period, the Chinese government embarked on theThird Front campaign to develop industrial and military facilities in the country's interior in preparation for defending against the risk of invasion by the Soviet Union or the United States.[8]: 41–44 Through its distribution of infrastructure, industry, and human capital around the country, the Third Front created favorable conditions for subsequent market development and private enterprise.[8]: 177
Since the launch of economic reforms in 1978, China's industrial sector has undergone profound structural transformation.[3] The shift from a centrally planned economy to amarket-oriented system led to the diversification of ownership forms, the expansion of manufacturing, and the gradual rise of China as a global industrial power.[9]
In the early reform years, thestate began loosening direct control over industrial enterprises.[3][10] Thestate-owned enterprise (SOE) system, which dominated China's industrial landscape in the pre-reform era, was gradually restructured.[3][10] From the mid-1980s onward, policies encouraged managerial autonomy, profit retention, and performance-based contracts.[3][10] During the 1990s, large-scale SOE reforms led to widespreadprivatization and the emergence ofshareholdingsystems.[3][10] Many small and medium-sized SOEs were closed ormerged, while key large enterprises were corporatized and listed onstock markets, both domestically and abroad.[3][10]
At the same time, non-state industrial sectors expanded rapidly.[11]Township and village enterprises (TVEs) emerged as a dynamic force in rural industrialization during the 1980s and early 1990s.[11]Private enterprises were gradually legalized and expanded into manufacturing,textiles, electronics, and otherlight industries.[11] By the early 2000s, non-state enterprises accounted for the majority of industrial output value.[11]
China's accession to theWorld Trade Organization (WTO) in 2001 further accelerated its industrial development.[12] China's industrial base became increasingly export-oriented, with labor-intensive manufacturing—such asgarments, electronics, andtoys—playing a central role.[12]Foreign direct investment (FDI), particularly incoastal provinces, introduced advanced technologies and management practices.[12]Joint ventures andwholly foreign-owned enterprises flourished in sectors like automotive,consumer electronics, and telecommunications.[12]
Between 2001 and 2010, China became known as the "world's factory," producing a growing share of global manufactured goods. By 2010, it had overtakenthe United States to become the world's largest manufacturing nation byvalue added.[13][14]
Following its 2001 entry into the World Trade Organization, China quickly developed a reputation as the "world's factory" through its manufacturing exports.[15]: 256 The complexity of its exports increased over time, and as of 2019 it accounts for approximately 25% of all high tech goods produced globally.[15]: 256
Since 2010, China has had the world's largest construction market.[16]: 112
In the 2010s, Chinese policymakers prioritized shifting from low-end manufacturing to higher-value-added, innovation-driven industries.[17] The “Made in China 2025” initiative, launched in 2015, aimed to upgrade ten key industrial sectors, includingrobotics,aerospace, advancedrail equipment,new energy vehicles, andmedical devices.[17] The goal was to enhance domestic technological capabilities and reduce dependence on imported components and equipment.[17] Research and development(R&D) spending increased significantly, with industrial firms becoming major contributors.[18][19] The proportion of Chinese manufactured goods at the higher end of thevalue chain grew after the early 2000s and accelerated further after 2020.[20]: 38 As of the early 2020s, China ranked among the top global countries in manufacturing output for high-tech industries, such assolar panels,5G equipment, andelectric vehicles.[21] Government policies supported strategic emerging industries throughsubsidies,tax incentives, andindustrial parks.[22]
State-owned enterprises continued to dominate in strategic sectors such as energy, telecommunications, and heavy industry, whilethe private sector and foreign-invested firms played leading roles in consumer goods, light industry, and technology manufacturing.[19][23]
Beginning in 2010 and continuing through at least 2023, China has produced more industrial goods per year than any other country.[24]: 1 It is also the world's largest user ofindustrial robots.[15]: 264
 | This section'sfactual accuracy may be compromised due to out-of-date information. Please help update this article to reflect recent events or newly available information.(May 2025) |
In 2018-2019, 37.6% of industrial assets were privately owned.[20]: 30
According to theNational Bureau of Statistics of China, the proportion of the output value of the secondary industry (including construction) in the China's GDP and the proportion of the number of employees in the total number of employees are shown in the following table:[1][needs update]
| year | Proportion of secondary industry output value in GDP (%) | Industrial output as a percentage of GDP (%) | Share of secondary industry in total employment (%) |
|---|---|---|---|
| 1952 | 20.7 | 17.6 | 7.4 |
| 1960 | 44.3 | 39.0 | 15.9 |
| 1970 | 40.2 | 36.6 | 10.2 |
| 1980 | 48.0 | 43.8 | 18.2 |
| 1985 | 42.6 | 38.2 | 20.8 |
| 1990 | 41.0 | 36.5 | 21.4 |
| 1995 | 46.5 | 40.6 | 23.0 |
| 2000 | 45.1 | 39.7 | 22.5 |
| 2001 | 44.3 | 39.1 | 22.3 |
| 2002 | 43.9 | 38.7 | 21.4 |
| 2003 | 45.0 | 39.7 | 21.6 |
| 2004 | 45.2 | 40.1 | 22.5 |
| 2005 | 46.4 | 41.1 | 23.8 |
| 2006 | 46.9 | 41.4 | 25.2 |
| 2007 | 46.2 | 40.7 | 26.8 |
| 2008 | 46.2 | 40.6 | 27.2 |
| 2009 | 45.2 | 39.0 | 27.8 |
| 2010 | 45.7 | 39.4 | 28.7 |
| 2011 | 45.8 | 39.4 | 29.6 |
| 2012 | 44.7 | 38.2 | 30.5 |
| 2013 | 43.4 | 36.8 | 30.3 |
| 2014 | 42.3 | 35.6 | 30.2 |
| 2015 | 40.0 | 33.4 | 29.7 |
| 2016 | 38.8 | 32.2 | 29.2 |
| 2017 | 39.1 | 32.5 | 28.6 |
| 2018 | 39.0 | 32.2 | 28.2 |
| 2019 | 37.8 | 30.9 | 28.1 |
| 2020 | 36.9 | 30.1 | 28.7 |
| 2021 | 38.1 | 31.5 | 29.1 |
China's machinery manufacturing industry can provide complete sets of large advanced equipment, including large gas turbines, large pump storage groups, and nuclear power sets, ultra-high voltage direct-current transmission and transformer equipment, complete sets of large metallurgical, fertilizer and petro-chemical equipment, urban light rail transport equipment, and new papermaking and textile machinery. Machinery andtransportation equipment have been the mainstay products of Chinese exports, as China's leading export sector for successive 11 years from 1996 to 2006. In 2006, the export value of machinery and transportation equipment reached 425 billion US dollars, 28.3 percent more than 2005.[25]
As of 2022[update], more than 200 types of minerals are actively explored or mined in thePeople's Republic of China (PRC). These resources are widely but not evenly distributed throughout the country. Taken as a whole,China's economy and exports do not rely on the mining industry, but the industry is critical to various subnational governments of the PRC.
Mining is extensively regulated in the PRC and involves numerous regulatory bodies. Thestate owns all mineral rights, regardless of the ownership of the land on which the minerals are located. Mining rights can be obtained upon government approval, and payment of mining and prospecting fees.
During theMao Zedong era, mineral exploration and mining was limited tostate-owned enterprises and collectively owned enterprises and private exploration of mineral resources was largely prohibited. The industry was opened to private enterprises during theChinese economic reform in the 1980s and became increasingly marketized in the 1990s. In the mid-2000s, the Chinese government sought to consolidate the industry due to concerns about underutilization of resources, workplace safety, and environmental harm. During that period, state-owned enterprises purchased smaller privately owned mines. China's mining industry grew substantially and the period from the early 2000s to 2012 is often referred to as a "golden decade" in the mining industry.
By the end of 2024, China's total installedpower generation capacity reached 3,348.62 million kilowatts.[31] This included 1,444.45 million kilowatts of thermal power, 435.95 millionkilowatts ofhydropower, 60.83 million kilowatts ofnuclear power, 520.68 million kilowatts of grid-connectedwind power, and 886.66 million kilowatts of grid-connectedsolar power.[31] The continued expansion of non-fossil fuel sources, particularlywind andsolar energy, reflects China's efforts to diversify itsenergy mix and promote cleanerelectricity generation.[32] These developments align with China's stated goals of achieving carbon peaking by 2030 andcarbon neutrality by 2060.[33]
China possesses the world's largest installed hydropower capacity.[34] As of the end of 2024, the total capacity reached approximately 436gigawatts, with major hydroelectric projects located along theYangtze and its tributaries.[31] Prominent facilities include the Three Gorges Dam,Baihetan Dam, andXiluodu Dam, each among the largest hydropower stations in the world.[34]
State-owned enterprises such asChina Three Gorges Corporation andChina Huadian Corporation lead the sector, contributing toenergy security,renewable energy expansion, and peak-load balancing.[35]
The People's Republic of China ranks third in the world both in total nuclear power capacity installed and electricity generated, accounting for around one tenth of global nuclear power generated.[36] As of December 31, 2024, mainland China operated a total of 57 nuclear power units, with a combined installed capacity of 59,431.7 MWe (rated capacity).[37] In 2024,nuclear power plants generated 445.175 billion kilowatt-hours of electricity, representing approximately 4.73% of mainland China's total electricity generation of 9,418.34 billionkilowatt-hours.[37]
The People's Republic of China has developed one of the world's largestwind power industries.[38] As of the end of 2024, the country's installed wind power capacity reached approximately 521 gigawatts, marking an 18% increase from the previous year.[31] This expansion is part of China's broader efforts to diversify its energy mix and reduce carbon emissions.[39] The development of wind energy has been supported by national policies and strategic investments outlined in successive five-year plans.[39]
The People's Republic of China is also home to several of the world's leadingwind turbine manufacturers.[40] In 2024, Chinese companies includingGoldwind,Envision, andMingyang Wind Power ranked among the top three globally in terms ofwind turbine installations, collectively accounting for a significant share of the global market.[40] These manufacturers operate across a comprehensive industrial chain encompassing equipmentdesign,production, and deployment.[40] In parallel, major state-owned enterprises such asChina Huaneng Group andChina Datang Corporation play central roles in wind farm construction and operation, contributing to the sector's rapid growth.[40]
Wind farms are predominantly located in northern, northeastern, and northwestern regions, includingInner Mongolia,Xinjiang, andHebei, with a growing presence of offshore wind projects along the easterncoastline.[39] The rapid growth of wind energy contributes significantly to China's transition toward a low-carbon energy system and its stated goals of peaking carbon emissions by 2030 and achieving carbon neutrality by 2060.[39]
