Creating the right scale for growth

Industry competitiveness on an international scale usually requires a critical mass of small to medium-sized competitors or a fast-growing, acquisitive larger industry player.

Emerging market economies that have produced global competitors often followed the former path, e.g. Japan with its keiretsu industry clusters and South Korea with its family-owned chaebol. The likes of brands such as Sony and Samsung have emerged on the world stage as a result.

But the way forward for the internationalization of Chinese industry, especially the State-owned sector, may require industry consolidation to create a single corporate structure that is capable of expanding internationally. The recent restructuring within the nation's railway and nuclear power sectors would suggest this path is already being pursued.