Chinese New Materials Firms Strive for Independence
Miao Qi
DATE:  Sep 26 2018
/ SOURCE:  Yicai
Chinese New Materials Firms Strive for Independence Chinese New Materials Firms Strive for Independence

(Yicai Global) Sept. 26 -- Chinese firms in the new materials sector, including graphene, lightweight car structures, and environmentally friendly materials, are becoming increasingly self-supplied, an official from Shanghai's municipal government said.

Domestic companies have developed more products on their own in some areas instead of entirely relying on imports, said Jiang Wei, director of New Materials bureau under the Shanghai Municipal Economic and Informatization Commission. Jiang spoke to Yicai Global at the 20th China International Industry Fair, a five-day trade event that gathered international industry leaders to Shanghai.

Shanghai municipal government will provide as much support as possible for the development of new materials, said Wu Jincheng, vice chairman of the commission. By 2020, the city will strive to establish one or two industrial clusters involving advanced new materials for fields such as chips, vehicles, aviation and high-end equipment, he added.

New materials are key to the sectors of integrated circuits and artificial intelligence and determine success or failure in many major projects, said Wu. The emergent field is rich with startups involving hot topics such as AI, he added. Fresh graduates have founded their own firms and the government has established funds for them to accelerate development.

Shanghai has over 540 new materials companies above a designated scale, with a total output value of CNY128.6 billion (USD19 billion) as of at the end of June, which is over 10 percent more than last year, Wu said. This is over 25 percent of the city's total output value of emerging industries, he added.

One of the exhibitors was Shanghai Levson Group which showed its graphene products. The Shanghai-based firm began transitioning toward new materials in 2010. Now it has many core technologies and competence of its own in the graphene area, said Vice President Zhao Zhiguo.

However, Levson's success has a caveat. The firm's output value plummeted in the transition and the company also needed to spend more than CNY20 million (USD3 million) each year on research and development, Zhao said, adding that at first, the new business line did not produce any profits. The research and development of new materials demands a lot of money, takes a long time and has a risk of failure, he added.

In this year's CIIF, the new material display area was about 12 percent larger in size than last year with its with its 12,000 square meters. Over 200 companies were present, which was 22 percent more than in 2017. The number of foreign firms was relatively stable, most of them coming from Germany, Belgium and Malaysia.

Editor: Emmi Laine

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Keywords:   R&D,Government Policy,Shanghai,CIIF