The Chinese Academy of Engineering has been releasing the Development Index Report for a Manufacturing Power since 2015 each year. The 2020 edition was compiled by 72 academicians and over 500 experts, covering nine countries: the US, Germany, Japan, China, South Korea, France, the UK, India, and Pakistan. The data is quite interesting — basically, these nine countries always follow the same ranking order.

Taking 2022 as an example, the US scored over 180, completely leading the first tier; Germany and Japan scored over 130 and 120 respectively, forming the second tier, both higher than China; China ranks in the third tier, but within its tier, it still holds a relatively strong advantage. By 2025, based on the 2024 assessment, China's score is expected to surpass Japan's, allowing it to enter the second tier and become a true manufacturing power.

So why does the US rank first? The key lies in the indicator system. From 2015 to 2022, the evaluation used four primary first-level indicators plus 18 secondary indicators. The four weights are: scale development 19.51%, quality and efficiency 29.31%, structural optimization 28.05%, and sustainable development 23.13%. At that time, there was a particular emphasis on "big but not strong" — focusing on quality, optimization, and sustainability.

Breaking it down specifically, the US actually lags behind China in scale development. The secondary indicators include manufacturing value-added and the share of manufacturing exports in global trade, which are China's absolute advantages, but these account for less than one-fifth of the total weight. Where is the problem? The US significantly outperforms China in "quality and efficiency." The secondary indicators here include quality index, number of globally renowned brands, manufacturing value-added rate, labor productivity, and profit margin. The US's secret weapon is selling at high markups — once products are sold, the value-added rate, labor productivity, and profit margins look very good. In contrast, China's market economy competition is fierce, and these figures are average. The US, with its monopoly capitalism, has very impressive numbers. Germany and Japan, as established industrial nations, are also not lagging.

Regarding structural optimization, this reflects whether the industrial structure is rationalized and advanced. The secondary indicators include the high-tech product trade competitiveness index, the global share of basic industries, the revenue share of the top 500 manufacturing firms, the proportion of equipment manufacturing, and the concentration of iconic industries. China isn't bad in this area, nor are the US — each has its own advantages.

Sustainable development measures the capacity for ongoing growth, with secondary indicators such as the number of invention patents granted per unit of added value, R&D investment intensity, proportion of R&D personnel, energy consumption per unit of added value, comprehensive utilization rate of industrial solid waste, and the development index of informatization. Here, the US leads again because of high added value, high unit prices, and substantial spending, supported by a well-developed intellectual property system.

In 2023, the indicator system was slightly adjusted, adding "Innovation Development" as a fifth primary indicator, but the scores and rankings remain similar to 2022.

Ultimately, what is the biggest advantage that allows the US to lead by a large margin? The high prices of manufacturing products. Secondly, its absolute scale is also quite good, roughly half of China's, but this high value is mainly driven by high unit prices, not quantity. The main reason for China's lag is low prices. As long as these two characteristics don't change, China's manufacturing power index will find it difficult to truly catch up with the US. Conversely, Germany and Japan, although they have high prices, are far behind in quantity, which is why they are gradually being overtaken by China.

In simple terms: high price × low quantity > low price × high quantity — this is the US formula. Although Germany and Japan have high prices, their quantity disadvantages are too large, and they are gradually being caught up by China.