Since the 1990s, the global economic and financial environment has been undergoing dramatic transformation. With the reduction of barriers on trade and capital movement in various countries in the world, the advances in information technology, the rapid development of capital market, the world has witnessed an explosive period of mergers and acquisitions on a global scale. This global business revolution has fundamentally changed the way that human beings organise their economic activities: giant multinational corporations from high-income countries have dominated almost every industrial sector. They have major market share of the high value-added section of the value chain of these industries. They coordinate the competition and cooperation of the whole value chain through the approach of systems integration in order to advance technological progress and strengthen their own competitive capabilities.

Research on this global business revolution reveals that the world is not flat. For most of the firms from developing countries, in this so-called ‘global level playing field’, competitors from developed countries have enormous advantages in size, branding, science and technology, financing, management process and human resources. With the increasingly deepening of the global economic and financial integration, large multinational corporations from high-income countries have occupied dominant position in international trade, finance, procurement, service and production in most of the middle and low-income countries. In China, multinational corporations have already become an important force of economic development even before the full implementation of the rules of the World Trade Organisation.

In February 2005, Peking University and the University of Cambridge cooperated and established China Industry Development Research Centre (CIDRC). The objective is to take full advantage of the academic excellence of these two eminent universities and deepen the research on the global industrial transformation as well as the development path of the China’s strategic industries. CIDRC aims to become an international platform for industrial research and education, advancing theoretical and policy research on China’s industrial development and promoting exchanges and cooperation among academia, industrial sectors as well as government regulatory institutions.

With the support from Peking University, the University of Cambridge as well as other institutions in China, CIDRC has achieved sound development in recent years. In research on industrial development theory, the book Global Business Revolution: Industrial Consolidation, Systems Integration and the Cascade Effect has been published in 2007, which presents the foundation of CIDRC’s academic research. The book has received appreciation from both academia and industrial sectors. In research on industrial development strategies, CIDRC cooperates with the University of Cambridge, China National Petroleum and Gas Corporation, China Petrochemical Corporation, Shanghai Futures Exchange and conduct research on strategic industries such as energy. CIDRC has produced a series of high-quality research reports. In policy research, CIDRC has commission from the China Banking Regulatory Commission to monitor the operation of key industries such as steel, automobile, coal, and to provide risk identification prompting service for banking regulation in China. In international exchanges, CIDRC invites international renowned scholars to teach in Peking University and has organised several international academic forums. In enterprise and government training sector, CIDRC, working together with the State Council Development Research Centre and the University of Cambridge, organises the China Executive Leadership Programme (CELP) under the Central Organisation Department of the Chinese Communist Party. The CELP programme provides overseas training services for leaders from enterprises, financial institutions, and ministries under the central government. The first two CELP programmes in Europe have been hugely successful and has won full acknowledgement from the participants.

On behalf of all the scholars at CIDRC, I wish to thank our colleagues and friends for their care and support for the development of CIDRC. With your help and encouragement, we are confident that the China Industry Development Research Centre will continue its development. We will try our best to make contribution to the industrial development of China.

The China Industry Development Research Centre (CIDRC) is jointly established by the Cambridge China Development Centre, UK and Peking University, China, under the authorisation of the Ministry of Education of the People’s Republic of China. CIDRC is a non-profit organisation registered under Peking University. CIDRC undertakes academic and policy research as well as academic exchanges. CIDRC also provides research-based consulting services and advanced training programmes.

2.1 Background

2.2 Mission

2.3 Organisational Structure

1.3.1 Industry Development Research Division (IDRD) undertakes research on the international competitiveness of China’s strategic industries based on detailed case studies. IDRD issues series of reports on industrial competitiveness, offering fact-based analysis and theory to policymakers. IDRD aims to develop theory of industrial competitiveness and development strategy that is most suitable for China’s situation.

1.3.2 Industry Information Division (IID) provides quantitative data to IDRD. IID establishes long-term partnership with national statistics departments, industrial associations, the media, and key enterprises. IID periodically releases macro industry information, such as market size, growth rate and growth projections, and publishes academic journal to provide important literature and cutting-edge research achievements on industrial development both at home and abroad. IID also provides consulting reports on market analysis and competitive structure of domestic and international markets in various industries at the request of clients, such as enterprises, investment banks, consulting companies and market research companies.

1.3.3 External Relations Division (ERD) organises conferences to facilitate policy discussions among academic institutions, government entities and enterprises. ERD liaises with international academic institutions and organises seminars and conferences on topics related to industry development. These meetings form one of the major channels of dialogue among policymakers, domestic industry and multinational participants.

CIDRC is currently engaged in the following research areas:
．Strategic industries;
．Key industries in China.

3.1 Research on Strategic Industries

3.1.1 Oil Industry
CIDRC has collaborated with the University of Cambridge, China National Petroleum Corporation (CNPC), China Petrochemical Corporation (SINOPEC) and Shanghai Futures Exchange (SHFE) for research on the oil industry. CIDRC has led several research programmes on global supply and demand, strategies of global oil companies, national energy strategies, and distribution and pricing systems. CIDRC has produced some major research including Comparative Studies on Global Energy Strategies, Research on Oil Industry Structures and Multinational Corporation Strategies, Global Oil Industry Development: Present and Prospect, Supply and Demand in Global Oil Industry, Asian Crude Oil Market and Selection of Benchmark Crude Oil for China, Studies on International Oil Market System and Finance, and Studies on the System of China’s Oil Market.

3.1.2 Telecommunication Industry
CIDRC has collaborated with the University of Cambridge in studying the global telecommunication equipment industry. CIDRC researchers have visited companies participating in the value chain of global telecom industry and conducted in-depth interviews with senior management of leading companies including Huawei, Siemens, Emerson, IBM, CNC, Telefónica and British Telecom.

3.2 Key Industries Report

CIDRC collaborates with the China Banking Regulatory Commission (CBRC) and Shanghai Futures Exchange (SHFE) in monitoring the operation of China’s key industries including oil, coal, nonferrous metal, steel, power, automobile, real state and textile. CIDRC researchers closely follow the dynamics of these industries and visit companies for in-depth interviews, and provide data and analysis on these industries. The high quality of these reports has gained full acknowledgement from experts in these industries.

CIDRC invites renowned domestic and international experts and scholars to give lectures and conduct collaborative research. CIDRC organises cooperation and mutual visits among relevant domestic and international research institutes to strengthen communication between the academic community and industry both at home and abroad. A number of domestic and international scholars have given seminars at CIDRC. CIDRC has successfully held several international conferences on cutting-edge topics.

3.1 International Conference

4.1.1 Conference on International Oil Trade and Oil Company Strategies
The “Conference on International Oil Trade and Oil Company Strategies” is jointly sponsored by CIDRC and Shanghai Futures Exchange (SHFE). It was held at the Diaoyutai State Guest House in Beijing on 8th April, 2006 and achieved great success. About 50 leaders and representatives from relevant state commissions and ministries, domestic and international oil companies, international oil-trading companies and international financial institutions attended the conference and delivered excellent presentations on the oil industry, international oil trade and strategies of oil companies.

4.1.2 The First International Forum on Chinese Energy Strategies
The first “International Forum on Chinese Energy Strategies”, jointly sponsored by CIDRC and China University of Petroleum (Beijing), was successfully held at China University of Petroleum on 6th~7th October, 2006. More than 200 representatives from the government, energy companies and the academic community discussed energy policies, energy finance and market, globalising operation and management of energy companies, international merger and acquisition and the securities market. Researchers from CIDRC presented reports on two major topics: 1. Industry Consolidation and Restructuring in Independent E&P Oil Company and the Inspiration for China; 2. The Reliance of Corporate Competitiveness on Context—with An Example of Petroleum Industry. The presentations were highly commended by the leaders and representatives to the forum. The forum received a lot of positive response and was widely considered as a high standard international academic conference, providing great support for leading academic research on Chinese energy strategies.

4.2 International Scholars

4.2.1 Professor Peter Nolan
Professor Peter Nolan, Chairman of the Development Studies Committee and Professor of Judge Business School, University of Cambridge is CIDRC’s senior Advisor. Professor Nolan paid visit to CIDRC in April and November, 2006 and delivered two lectures on “Global Business Revolution and Challenges for the Telecom Industry” and “Globalisation and Development of World Economy and Challenges for Developing Countries”. Professor Nolan presented insightful analysis on the development of the Chinese telecom industry and the challenges presented by globalisation, polarisation of the world economy under globalisation and the challenges faced by Chinese companies.

3.2.2 Professor Ove K. Pedersen
At CIDRC's invitation, Professor Ove K. Pedersen, Director of International Centre of Business and Politics, Copenhagen Business School, Denmark visited CIDRC from 1st to 9th November, 2006. Professor Pedersen delivered two lectures, and had a series of roundtable discussions with CIDRC researchers on the Danish economic development mode and national competitiveness.

5.1 Books

．Nolan, P., Zhang, J. and Liu, C. (2007) The Global Business Revolution and the Cascade Effect: Systems Integration in the Aerospace, Beverages and Retail Industries. Basingstoke: Palgrave.

．Liu, C. (2007) Multinationals, Globalisation, and Indigenous Firms in China. London: Routledge.

．Zhang, J. (2004) Catch-up and Competitiveness in China: the Case of Large Firms in the Oil Industry. London: Routledge.

4.2 Papers

．Nolan, P., Zhang, J. and Liu, C. (2006) “Global Business Revolution, Cascade Effect and the Challenges for Catch-up for Large Indigenous Chinese Enterprises [in Chinese: quanqiu shangye gemin, pubu xiaoying yiji zhongguo qiye mianlin de tiaozhan].” Journal of Peking University (Beijing da xue xue bao), 43(2): 132-140.

．Nolan, P., Zhang, J. and Liu, C. (forthcoming 2007) “Global Business Revolution, the Cascade Effect and the Challenges for Firms from Developing Countries.” Cambridge Journal of Economics.

．Nolan, P., Zhang, J. and Liu, C. (2007) “Technical Change and Firm Level Catch-up Developing Countries: The Case of Telecommunications.” (Conference Paper). China Development Forum——China: Towards New Models of Economic Growth. March, Beijing, China. Development Research Centre of the State Council.

．Wang, N., Liu, C. and Zhang, J. (forthcoming 2007) “Industry Consolidation and Restructuring in Independent E&P Oil Companies and the Inspiration for China.” Modernization of Management.

5.3 Internal Journal

The CIDRC internal journal was launched in September 2005. Up to now more than 10 issues have been released. The journal aims to provide timely information on the dynamics in the global strategic industries such as oil and gas. Readers cover relevant government departments, leading domestic universities and research institutes, major domestic and international oil companies, oil-trading companies and financial institutions.

The China Executive Leadership Programme (CELP) is launched by the Organisation Department of the Central Committee of the Communist Party of China (CPC), and jointly organised by the Development Research Centre of the State Council, the University of Cambridge and Peking University. CELP focuses on the reform and development of large state-owned Chinese companies in the context of economic globalisation. The Programme is designed to address the following topics: globalisation, sustainable development, finance, leadership of large companies, national industrial policies and company development, relationship between international organisations and large companies, development of human resources, branding strategies, mergers and acquisitions, and global supply chain. CELP participants are the leaders from major companies and financial institutions the Central Government and relevant government commissions and ministries. Participants study for three weeks at the University of Cambridge, followed by study tours in some other European countries. The effective work by CIDRC for the China Executive Leadership Programme in terms of curriculum design, lecture and organisation, were unanimously acknowledged by the CPC Organisation Department and the leaders participating in the Programme.