China's National Champions: The Evolution of a National Industrial Policy - Or a New Era of Economic Protectionism?

In this article we ask a series of related research questions concerning China's recent industrial policies, particularly the 10th and 11th five-year economic policy plans. Our questions go to the nature of China's long-term competitiveness of its national champions, and to what extent Chinese government policies are evolving to domestic protectionism that adversely affects foreign invested enterprises' (FIEs) competitive position in the Chinese economy. We thus evaluate the nature of the five-year economic policy plans, their adverse impact on FIEs operating in China, and the rise of designated Chinese national champions (in the 11th five-year economic policy plan) to compete with major FIEs on a global scale. However, we suggest that the role of the Chinese government's recent industrial policy, when compared to Michael Porter's "Diamond of National Competitive Advantage" recommended government policy approaches, may not augur well in the long-term for China's national champions. (C) 2013 Wiley Periodicals, Inc.