To witness China's formidable industrial strength, one might visit Changxing Island in the country's northeast. Part of China's vast industrial machinery lies on this island extending into the Bohai Sea—a petrochemical industrial park that has been expanding since its successful launch in 2012. It stands as a benchmark for Chinese manufacturing, embodying the factors that have propelled China to dominance in global manufacturing: policy directives, state support, local incentives, and enterprising entrepreneurs.
The story of Dalian Changxing Island illustrates how difficult it has become for other nations to replace China in global supply chains. Given China's sprawling manufacturing base, similar transformations are unfolding across factories and regions nationwide. Changxing Island's rapid rise—from an almost industry-free island to a global industrial pillar in just over a decade—offers a clear lens into China's industrial acceleration.
Until the early 2000s, Changxing Island was primarily farmland and fishing villages under Dalian's jurisdiction. But it held a key advantage: one of the finest deep-water port coastlines in the Bohai Bay. China's national planning authorities designated the island as an economic and technological development zone, aiming to build a trillion-yuan green petrochemical cluster. They promised preferential policies for investors, from streamlined approvals to subsidies.
Private Chinese enterprises responded vigorously. Over 1,000 kilometers south of Dalian Changxing Island lies the headquarters of Hengli Group, a polyester producer. Hengli's ascent began in 1994 when an entrepreneurial couple seized the opportunity to acquire a chemical fiber factory. Later, they identified a chance to move up the value chain on Changxing Island: producing purified terephthalic acid (PTA), a white powder used in polyester manufacturing.
In 2010, Hengli Petrochemical (Dalian Changxing Island) Industrial Park was established. After several expansions, it has become one of the world's largest PTA production bases. Meanwhile, China has transformed from a net PTA importer a decade ago to the dominant supplier, accounting for over 60% of global output.
China's support for domestic enterprises extends beyond funding. Companies also gain direct access to specialized scientific expertise. Just a ten-minute drive from Hengli Petrochemical's sprawling facilities sits the Changxing Island campus of the Dalian Institute of Chemical Physics, Chinese Academy of Sciences. Among other research, scientists there focus on designing more efficient PTA production methods.
Should other nations worry about China's dominance in PTA production? Some argue it’s inconsequential—polyester supply chains aren’t tied to national security, and PTA is a commodity. If needed, other countries could restart their factories. By relying on relatively cheap Chinese PTA, they could redirect investments elsewhere.
Yet this view may be shortsighted. The chemical industry is often called the "mother of industries" because countless products depend on chemical inputs. PTA is just one example; China's dominance spans many more chemical products—and it continues to expand. While officials from Washington to Brussels focus on rare earths, overlooking chemicals could leave them vulnerable.
Meanwhile, Changxing Island marches forward. Catching up with China is already daunting—especially when the target keeps moving.