Zhang Xiaoqiang: Speech Delivered at “China 5G Economic Symposium” and “China 5G Economic Report 2020” Press Conference

By Zhang Xiaoqiang, Executive Vice Chairman of CCIEE

Ladies and gentlemen, good morning!

I am very glad to participate in the China 5G Economic Symposium and I would like to extend a warm welcome to all friends here today. In terms of the development of China’s 5G industry, I would like to share my viewpoints with you in the following three aspects.

First of all, China’s 5G will promote the development of a new era and high-quality development.

5G is the main development direction of the new generation of information and communication technology and is a new driving force for achieving China’s high-quality development. Thus, many countries are accelerating the strategic implementation and policy deployment of the 5G network.

The Chinese government attaches great importance to the development of 5G and has issued policy documents to support 5G development. For example, the 13th Five-Year Plan proposed to treat 5G as a national strategy and an important task of national innovation. According to the forecast of the China Academy of Information and Communication Technology, the economic value added by China’s 5G commercial application will be 3.3 trillion yuan from 2020 to 2025, and the indirect economic value added will reach 8.4 trillion yuan. The corresponding economic output will be 10.6 and 24.8 trillion yuan.

By 2030, 5G is expected to create more than 8 million employments in China. The development of 5G and related industries will play an important role in optimizing multiple industries in China and meeting the growing needs of the people for a better life.

In view of the strategic significance of 5G development, China Economic Consulting Corporation and the China Academy of Information and Communications Technology jointly conducted a research on the development of China’s 5G and related industries. Later, Dr. Zhang Jin of CCIEE will release the research results.

Secondly, we should deepen reform and coordinate with all parties to promote China’s 5G development.

China has advantages in the development of 5G. Many 5G-related standards advocated by China have become an important part of international standards. According to the Beijing 5G Industry White Paper 2019, released by Beijing Economic and Information Technology Bureau, there will be 6.5 million of 5G base stations worldwide by 2025, 2.8 billion of 5G users, of which 4 million of base stations and 1 billion users come from China. I have doubts about these figures because the World Communications Association predicted that there will be 1.57 billion 5G users only by 2025. The Association also proposed that the users from China, the United States, Japan and South Korea will account for more than 50% of the total users, which I think is accurate. No matter what, China is a huge market for the 5G network, there is no doubt about that.

From January to November 2019, 358 million mobile phones were produced in China, a 5.4% year-on-year decrease. However, 8.36 million 5G mobile phones have been produced in the past few months. Last year, no 5G mobile phone was sold because there was no 5G network. As can be seen, China’s 5G and economic and social development are facing historical opportunities. In order to seize the opportunity and promote the healthy development of 5G and related industries, I think that we need to work on the following three aspects.

Firstly, making an overall plan for the 5G network construction, reducing the cost of construction and making full use of existing infrastructure resources. Initially, we could focus on enhancing mobile broadband and increasing reliability. As technology and networks develop, the 5G network should be spread to other areas gradually. The building of the 5G network requires huge investment and thus, we should promote joint construction and sharing of the 5G infrastructure, avoid repeated construction and save investment. By transforming smart meters of base stations and enhancing research on low-power technology development, we can reduce the costs of network operation and maintenance in the long-term. At the national level, we should establish cross-industry and cross-sector coordination mechanisms, come up with a clear plan in such areas as connected cars, industrial Internet, medical and health, cultural creativity and entertainment, so as to create good policies for 5G application innovation.

Secondly, strengthening the research on 5G network and related industries, and establish the ecosystem and standard accordingly. The construction and development of 5G networks will affect the Internet of Vehicles, the Industrial Internet, the digital economy, and the construction of smart cities. Thus, it is necessary to strengthen the research on the current status and trend of application in 5G-related industries, analyze the application needs and typical application scenarios in multiple industrial fields. Specifically, we should analyze the new ecology and models of 5G applications. Especially for industries such as the Internet of Vehicles and the Industrial Internet, we should research on key standards, regulate industrial interface data, create effective interconnection, and launch mutual recognition between different products and application systems. In addition, we must also attach great importance to security standards. The advantages of 5G can be summarized as high speed, low latency and wide connections. However, the tremendous loss will be caused if problems occur. The construction of testing and certification system covers the assessment of technologies, products, services and so forth. We need to evaluate mainstream products gradually and release quality analysis reports.

Thirdly, strengthening the training and introduction of talents in the 5G industry, and improving the innovation capability. Innovation is the first driving force and talent is the first resource and hence we must value the training and selection of 5G talents. Hopefully, 5G industry experts, data scientists, AI engineers, senior executives can be classified as high-level talents and given corresponding funding. Of course, we must encourage the establishment of public service platforms to serve 5G and related industries. Think tanks can also play a role in this regard. We must pay attention to the continuous research and development of 5G products while carrying out early research on 6G.

Third, we must promote international cooperation in the development of the 5G industry with an open mind.

The Sino-US economic and trade relations have been relatively tense since 2018. In response, CCIEE has held many seminars to discuss with US experts, scholars, and entrepreneurs on how could the two countries conduct international cooperation in science and technology. The participants from both sides called on joint efforts to promote international cooperation on 5G.

5G technology can be closely integrated with the global industry chain, supply chain and value chain. It is the product of exchanges and cooperation among countries in the tide of globalization, and a common high-tech innovation platform of the international community. We should encourage Chinese and international participants to promote international cooperation and exchanges in the 5G industry with an open attitude, including cooperation between China and the United States.

Last night, the American Chamber of Commerce in China held a commemorative ceremony for its 100th anniversary. Vice Premier Hu Chunhua delivered a speech, giving a positive affirmation of the important role played by the American Chamber of Commerce in promoting Sino-US economic and trade cooperation. Meanwhile, he hopes that everyone can make joint efforts to deal with the trade and economic frictions properly, manage differences and advance in the direction of win-win cooperation. Mr. William Klein, Minister Counsellor of the United States Embassy in China asked me what does CCIEE do? I said that CCIEE is a think tank researching different areas. CCIEE has also established the “second track” communication channels with business leaders and other important economic groups such as the American Chamber of Commerce and the European Enterprise Association. The “second track” dialogue between China and the United States is the first one established by CCIEE and so far, more than ten dialogues have been conducted. This platform gives both Chinese and US CEOs and officials an opportunity to exchange their thoughts and enhance mutual understanding, which was affirmed by President Xi Jinping and Premier Li Keqiang.

Some of the researches have been completed by ourselves, while others were completed by China Economic Consulting Co., Ltd. For example, we have conducted a joint research with Qualcomm on the 5G network and the research report will be released tomorrow morning. Mr. William Klein asked me what are the major points of this research report? I said that the research report believes that China and the United States can achieve mutual benefit and win-win cooperation in 5G. He asked me what are the main reasons for the statement? I said that China is the world’s largest market and has a complete industrial chain. Many American companies have advanced technologies and patents. For example, the technology and patents of Qualcomm are widely used in China and about 60% of its total operating income and profits come from China.

I also asked him to ask Mr. Yang Xu, the Global Vice President of Intel Corporation, whether 36% of their global operating income comes from China. Therefore, we should work together to maximize our complementary advantages, achieve mutual benefits and win-win results, and continuously improve the 5G network to promote the economic and social development of China, the US and the rest of the world, and play an important role in creating sustainable and healthy development.

Dear friends, CCIEE is willing to work together with all of you to contribute to international cooperation in creating an open world economy, enhancing technological innovation and building a better tomorrow for mankind.

Finally, I wish this 5G economic seminar a complete success.

Thank you!