Affected by the continuous escalation of the European sovereign debt crisis, world economic growth slowed down significantly in the first half of 2012, and new developments in world industrial development also occurred. The recovery of the U.S. manufacturing industry is significant, but the EU's manufacturing industry has contracted significantly, and industrial growth in emerging countries has shown a downward trend.

On July 20th, the research group of the world's industrial trend forecast of the Citi think tank released the “Analysis and Forecast of World Industrial Trends in the Second Half of 2012” report. The report pointed out that there are still many deep-seated issues in the world's industrial development. It is expected that the world's industrial growth rate will decline in the second half of 2012, but it will continue to maintain a modest recovery trend. The growth of traditional industries will slow down and emerging industries will maintain rapid growth. The trade deficit of some developed countries will continue to grow, while the growth of trade among emerging countries will continue to expand. With the accelerated return of manufacturing industries in developed countries, and emerging countries accelerating industrial transformation and upgrading, global manufacturing competition will intensify. China is still in the critical stage of industrial transformation and upgrading. Taking active measures to enhance China's industrial sustainable development capability is of great significance to the development of the world industry.

In the first half of 2012, the global economic growth slowed down. At the same time, the world industrial production situation has improved. From January to May 2012, the global manufacturing industry has been expanding for six consecutive months, and the manufacturing growth momentum has improved. However, from the global manufacturing PMI index in the first half of 2012, the global manufacturing PMI fell to 50.6 in May from 51.4 in April, and the increase in industrial production decreased. Global trade growth continues at a relatively low growth rate. Global market demand continues to rise and the global manufacturing employment population continues to increase. The EU is the biggest drag on global manufacturing, with the Eurozone and UK manufacturing PMI falling to their lowest level in three years. Manufacturing in Germany, France, Italy, Spain, the Netherlands, and Greece contracted significantly, Ireland expanded moderately, and Austria was close to stagnation. The May PMI index released by the American Supplier Association has declined, but it is still higher than the global manufacturing PMI average. Japan's manufacturing industry continued to expand slightly under the impetus of post-disaster reconstruction. Industrial growth rates in emerging countries such as China, India and Russia have shown signs of decline.

There are still many unstable factors. The report points out that there are still many destabilizing factors in the world's industrial development, and it is difficult to effectively solve the deep-seated problems that constrain world industrial development in the short term.

The industrial expansion of developed economies is insufficient. Affected by the sovereign debt crisis in Europe, the industrial expansion of major advanced economies such as the United States, the European Union, and Japan is worrying. From January to May of 2012, the U.S. manufacturing PMIs were all above 52, indicating that U.S. manufacturing has expanded for a period of 34 consecutive months. However, U.S. industry may be tight because of the European economic recession, U.S. fiscal concerns, and declining corporate investment. Its industrial expansion momentum is slightly insufficient. The economic slowdown in the euro zone has curbed the demand for commodities, and European manufacturing has begun to shrink. According to the latest data released by the research institution Markit, the final value of the manufacturing purchasing managers' index (PMI) in the euro zone in June was 45.1, the lowest level since June 2009. The Japanese PMI index was higher than 50 for five consecutive months from January to May of 2012, but in line with the trend at the beginning of 2012, output growth relied heavily on the manufacture of investment products, and the manufacturing of consumer goods and semi-finished products shrank, reflecting the Japanese manufacturing industry. Insufficient kinetic energy for expansion.

The industrial base of emerging countries remains fragile. In the first half of 2012, emerging economies were generally hit by "three sides attacked" by steady growth, anti-inflation, and structural adjustment. Industrial growth has slowed down, indicating that emerging economies are greatly affected by international economic fluctuations and the industrial base remains weak. From January to May of 2012, the industrial added value of China's large-scale enterprises increased by 10.7% year-on-year, 0.3 percentage points lower than that of January-April. From January to March 2012, the total industrial production value of India was 179.7, which was a year-on-year increase of 0.4%. In April, the industrial output value increased by only 0.1% year-on-year. In 2012, the growth rate of industrial production in Russia slowed down. In the first quarter of 2012, industrial production increased by only 4% year-on-year. According to data released by Brazil's National Geographical Statistics Bureau, industrial production in Brazil fell by 3% in the first quarter of 2012 compared to the same period last year. This is the second consecutive quarter of decline in industrial production in Brazil, and the rate of decline has increased.

Unbalanced development in the industrial sector has further intensified.

Affected by the slowdown in global economic growth, different industries in the world continue to show uneven development. A group of high-growth industries represented by automobiles, construction machinery and biomedicine led the rapid recovery of industrial development in the world, while the iron and steel, non-ferrous metals, and chemical industries continued to slump, and the unbalanced trends in the industries of world industrial development were further aggravated. In the first half of 2012, the growth rate of the American automobile market was 5.8%, and sales of Japanese auto companies rose by 7%. However, corresponding to the steady growth of the automotive industry, international bulk commodity prices have fallen sharply, and the global raw material industry has been in a state of continuous downturn. The uneven development of the world's industrial sector has constrained the recovery of the global economy.

The deep-seated contradiction between global supply and demand imbalances has not yet been effectively resolved. Since the outbreak of the international financial crisis, major economies have accelerated the pace of economic restructuring, but the imbalance between global supply and demand continues. From the perspective of the demand gap, the continued fermentation of the European sovereign debt crisis has hit consumer confidence in developed countries. From a supply perspective, overcapacity in some developed countries has not been effectively mitigated in the short term, and some industries in emerging countries also have serious overcapacity problems. Take the United States as an example. In March 2012, the total industrial capacity utilization rate in the United States fell to 78.6 from 78.7 in February, and the total capacity utilization rate was still below 80%. Similarly, there are serious excesses in certain industries in China such as textiles, steel, wind power equipment, and polysilicon. The unemployment rate in developed countries is high, and it is difficult for private consumption to recover in the short term. It will surely restrict the increase of industrial capacity in the world and hinder the recovery of world industries.

The development report has more positive factors. In the second half of the year, from the supply side, global commodity prices will continue to fall, and global industrial production capacity will increase. From the demand side, the emerging countries’ demand for the consumer goods industry will continue to increase. The moderate recovery of the U.S. economy and the acceleration of Japan’s post-disaster reconstruction have played a role in promoting global industrial production. From the point of view of the trade environment, the mild economic recession in the EU has had a negative impact on global trade and output, and has adversely affected the exports of emerging and developing economies. Judging from the policy environment, major developed countries have introduced the strategy of re-industrialization with the intention of achieving economic recovery through the promotion of the development of the manufacturing industry, which is conducive to the steady growth of the world's industries.

Taking into account the global industrial development situation, it is expected that the world's industrial growth rate will decline in the second half of 2012, and it will maintain a moderate recovery. The growth of traditional industries will slow down, and emerging industries will maintain rapid growth. The trade deficit of some developed countries will continue to grow, while the growth of trade between emerging countries will continue to expand. With the accelerated return of manufacturing industries in developed countries, and emerging countries accelerating industrial transformation and upgrading, global manufacturing competition will intensify.

Actively promote industrial transformation and upgrading In the second half of 2012, the world's industrial development will face new opportunities and challenges. China is still at a critical stage of industrialization. It needs to take active measures to promote industrial transformation and upgrading, expand foreign investment, accelerate regional integration, promote balanced development of global trade, and enhance China's industrial sustainable development capabilities.

Pay close attention to the development of industrial development in the world and vigorously promote industrial transformation and upgrading. The first is to pay close attention to the policies, measures, and industrial development of the major developed countries such as the United States, the European Union, and Japan that have been promulgated, and to grasp current trends in industrial development in the world and timely summarize lessons learned from industrial development in various countries. The second is to accurately judge and systematically analyze the development trend of the global advanced manufacturing industry, and study and formulate a mid- and long-term development strategy for advanced manufacturing that suits China's national conditions. The third is to implement national key engineering projects and concentrate on breaking through a batch of key common technologies that support the development of manufacturing. Fourth, continue to create a good environment for innovation for SMEs, increase funding and policy support, and improve the technical service public service platform for SMEs.

Promote the "going out" of China's industrial enterprises and expand foreign investment. The first is to encourage Chinese enterprises to set up more production-oriented enterprises in developed countries and establish a two-way pull mechanism for domestic production and overseas production. The second is to encourage companies to strengthen mergers and acquisitions in Europe, expand acquisitions of small and medium-sized enterprises in the areas of machinery, automobiles, new energy, and environmental protection, and acquire more advanced technologies, R&D, and marketing systems. The third is to expand investment in emerging economies such as Africa, South America, and Southeast Asia, and deepen bilateral cooperation in manufacturing, infrastructure construction, energy, and mineral product development.

Accelerate the process of regional integration and promote the balanced development of global trade. The first is to deepen the China-ASEAN Free Trade Area and promote ASEAN as a new growth point for China's exports. The second is to strengthen communication and policy coordination between China and Japan and South Korea, intensify the establishment of China-Japan-Korea free trade zone, and accelerate the process of East Asian regional economic integration. The third is to properly handle trade frictions, improve the external environment for China’s development, and promote the liberalization and facilitation of trade and investment. The fourth is to continuously increase import promotion policies and promote the balanced development of global trade.