How can Small Businesses Benefit from Industry 4.0

1. You might think that Industry 4.0 only applies to large-scale industries, but many benefits also apply to SMEs, including increased efficiency and productivity, giving you greater business flexibility. This leads to enhanced profitability and better customer satisfaction. 

2. Industry 4.0 technologies provide you with more and better information to improve decision-making in your business. You'll find out how to optimise your organisational processes so that you'll save time and resources. In doing so, you'll deliver more services or products quickly and cost-effectively. It's a win-win situation.

RAMI 4.0 Reference Architectural Model for Industrie 4.0

1. The RAMI 4.0, Reference Architecture Model Industrie 4.0 (Industry 4.0), was developed by the German Electrical and Electronic Manufacturers' Association (ZVEI) to support Industry 4.0 initiatives, which are gaining broad acceptance throughout the world. 

2. Industry 4.0 (also termed Industrie 4.0) is a holistic view of manufacturing enterprises, started in Germany, with many worldwide cooperative efforts including China, Japan, and India. Industry 4.0 concepts, structure, and methods are being adopted worldwide to modernize manufacturing.

A New Generation of Robots Can Help Small Manufacturers

1. Automation is fundamentally changing industries and workplaces. The International Federation of Robotics predicts that in a decade, more than half of production operators will be working with robots. Big companies? They’re already there, harnessing advanced technology and optimizing their output. Small and medium-sized enterprises (SMEs)? Not so much.

2. Let’s take a moment to think about why this matters. Representing a whopping 99% of businesses, they’re the cogs and gears of U.S. and European economies — the backbone of job creation, supply chains, economic growth, and innovation. Overall, their role in building national economic resilience cannot be underestimated.

3. The fact that SMEs have typically been slow to harness the benefits of automation matters because a slow pace of adoption is often what prevents businesses from achieving the resilience and efficiency needed to remain competitive. When SMEs lag behind, we all feel it. Manufacturing continues to decline in key markets such as the U.S. and the UK, with both reporting ongoing manufacturing downturns since the start of the Covid-19 pandemic.

Providing the right levels of support to small and medium-size enterprises

 1. Government agencies and NGOs with a good understanding of SME subsegments can better tailor their programs to meet SMEs’ unmet needs. We have researched SME support programs across the world and categorized them into a matrix of ten approaches. Some are tailored to a single subsegment while others address one of the six unmet needs for all or most subsegments.

2. For all these categories, the specifics of how they are implemented matter; therefore it is difficult to draw universal best practices from them. However, it can be instructive to consider the following ways these programs are helping to close the productivity gap for SMEs.

Strategies for SME Growth

1. Small and medium-sized enterprises (SMEs) are the growth engine of many economies, but it can be a challenge for them to expand internationally and integrate into global value chains.

2. SMEs account for around 99% of companies and 70% of all jobs in OECD countries, and they contribute more than 50% of gross domestic product in high-income countries worldwide, according to a 2022 McKinsey report titled Beyond financials: Helping small and medium-sized enterprises thrive.

3. UN research from 2022 on the effect of the fourth industrial revolution on SMEs finds that major barriers to international expansion include an inability to benefit from economies of scale as easily, greater difficulty in accessing financial resources, and a higher likelihood of being burdened by bureaucracy and poor infrastructure.

4. The pandemic hit SMEs hard, setting back export growth. In mid-2020, McKinsey analysis found that 45% of small businesses were facing supply chain disruptions, which hindered their ability to export products and integrate into global value chains.

5. Advanced technologies such as artificial intelligence, data analytics, blockchain and automation are crucial in helping SMEs grow, ultimately claiming space in global value chains and further bolstering the economies of their host countries. However, the adoption of such advanced technologies often requires substantial financial investment and expertise, posing a challenge for SMEs with limited resources. Recognising this barrier, government support becomes paramount in facilitating SMEs’ access to these transformative technologies. Through funding initiatives, training programmes and strategic partnerships, governments can empower SMEs to harness the benefits of cutting-edge tools, fostering innovation and propelling international expansion.

6. Using South Korea as a case study, the UN research shows that compared with large companies, the South Korean SMEs that adopted Industry 4.0 technologies such as digital tools were more likely to invest and expand overseas.

Deepening Sino-EU cooperation serves global interests

1. The China-EU Summit, is important for many reasons, not least because it is the first face-to-face meeting between the two sides since 2019 at a time of escalating geopolitical tensions.

2. The several virtual meetings during the three years of the COVID-19 pandemic, albeit critical, were no substitutes for face-to-face meetings. There is no doubt the top leaders of the two sides need to meet more often and hold dialogue to understand each other better.

3. Unlike the European Union which has since March 2019 changed its definition of China-EU relations to cooperation partner, economic competitor and systemic rival, China's stance has been consistent: it views the China-EU relationship as a comprehensive strategic partnership, which began 20 years ago.

4. China and the EU, despite their differences, have great potential to expand cooperation, which has benefited both sides. Apart from trade, investment and people-to-people exchanges, such cooperation also includes working together to overcome global challenges such as climate change, global economic slowdown and nuclear proliferation.

Sino-US ties can seek win-win opportunities

 1. The adoption of a recommendation on critical technology areas for the European Union's economic security, for further risk assessment with EU member states by the European Commission on Oct 3, is seen by many as a concrete move by the EU to "de-risk" its economy from China's.

2. The EU has said the recommendation relates to the assessment of technology risk and technology leakage. After being referred to by European Commission President Ursula von der Leyen in March this year, "de-risking", as a term, has gained in popularity in the EU's policymaking circle, as well as among British politicians. When von der Leyen put forward the idea in a speech on EU-China ties in March, she might not have expected it to become so catchy.

3. Over the past few months, there have been intensive discussions on China in the European Union, with "de-risking" finding mention in some of the most important policy documents on China, including the European Economic Security Strategy, German National Security Strategy, and European Council statements.

4. "De-risking" is also becoming the preferred term, instead of "decoupling", for US politicians when referring to future Sino-US relations. Other G7 leaders, too, are using the term "de-risking" to describe their countries' future ties with China. Even the latest G7 Summit communique mentions "de-risking". For the EU, "de-risking" seems to have become the new prism through which to look at its relations with China.

China’s Belt and Road Initiative turns away from coal

1. Ambitious, contentious and big spending, China’s Belt and Road Initiative (BRI) is 10 years old. In that time, China has splashed more than US$1 trillion on overseas infrastructure projects. 

2. Power markets in developing economies have been major beneficiaries. But the rapid growth in much-needed generation capacity has also shone the spotlight on the initiative’s environmental impact and raised critics’ hackles over levels of indebtedness among poorer nations. 

3. Can BRI power sector projects be judged a success? Does its record on sustainability conflict with decarbonisation goals? Can Western efforts to counter China’s influence succeed? 

Can European renewables still turn a profit?

1. The European Union’s ambitious renewable energy target mandates at least 42.5% of EU energy consumption to come from renewable sources by 2030. For that to happen, developers need positive returns on their renewables investments.

2. With technology costs not evolving as hoped, where will the sources of project profitability come from instead?

Vietnam looks to build first semiconductor plant

1. Vietnam is looking to build its first semiconductor plant despite US warnings that it will involve high costs.

2. Reuters reported that officials have met with half a dozen US chip firms in the past few weeks, including with Vu Tu Thanh, head of the Vietnam office of the US-ASEAN Business Council.

3. According to one executive consulted by Reuters, the government in Hanoi is looking to build a plant for less advanced chips used in cars or telecom applications.

4. The Vietnamese government has said it wants to build its first plant by the end of this decade and  chip companies would benefit from “the highest incentives available in Vietnam”.

5. The move to attract chipmaking investors comes after a surge in FDI inflows in the country. According to national statistics, Vietnam attracted over $15.29bn in FDI between January and October 2023, marking a 54% year-on-year increase in the value of investments. Around $5.29bn was spent on 1,051 existing projects.

7 Btpa of carbon capture needed to meet net zero by 2050

 1. Urgency is needed to meet the seven billion tonnes carbon capture (Btpa) required to meet net zero goals in 2050.

2. Energy efficiencies, renewables and alternative fuels will not be enough to meet net zero by 2050.

3. We need a huge amount of carbon to be captured out of our industries and the power sector to decarbonise the last miles that can’t be easily reached by green electrification or alternatives. 

4. Right now, we are on track to meet our base case scenario, which forecasts 2 Btpa of CO2 capture and removal by 2050 – though this corresponds to a  2.5 degree global warming scenario. For net zero by 2050 and a 1.5 degree compliant scenario we would need 7 Btpa. To come close, we need to get shovels in the ground quickly.

Five trends to watch for in the electrolyser supply chain

 1. The electrolytic hydrogen sector is rapidly expanding, with over 85 Mtpa of projects announced and cumulative factory announcements exceeding 218 gigawatts of electrolyser capacity by the end of Q3 2023

2. In the ever-evolving landscape of renewable energy, the burgeoning electrolytic (green) hydrogen sector has made remarkable strides. Over 85 Mtpa of electrolytic hydrogen projects have been announced. This surge in electrolytic hydrogen has brought focus to the electrolyser supply chain, which will need to expand at an unprecedented pace to meet anticipated demand. By the close of the third quarter in 2023, cumulative factory announcements had already surpassed 218 gigawatts of electrolyser capacity.

3. As this sector matures and gathers momentum, profound transformations across the electrolyser supply chain are coming. From product design and operational strategies, to enhancing overall profitability – a shift in paradigms seems inevitable – heralding an exciting era of upheaval and innovation in the electrolytic hydrogen ecosystem.

Driving the energy transition: the EV and batteries outlook

1. Forecasts for the global electric vehicle market show there will be 44 million EVs on the road by 2030. Despite the move to de-carbonise the road transport market, the upfront costs of an EV is still prohibitive to the driver. 

2. To lessen this cost burden for consumers, governments have been offering modest tax credits and purchase subsidies. While these subsidies will give some relief in the short-term, the longer term consideration is focusing on the costs of raw materials and ensuring a protected and uninterrupted stream of battery raw materials (BRMs).

ROI for Industry 4.0 use cases

1. No factory can risk being left behind in the transition to smart manufacturing. If a factory fails to innovate its product and production process, it risks incurring a Cost of Inaction (COI), which is the cost of the lost opportunity. Deploying dedicated cellular-enabled industry 4.0 solutions can generate an operational cost savings ROI of 10x to 20x over 5 years. Learn from Industry 4.0 uses cases on how to move ahead wisely.

2. A recent study from ABI Research outlines the “intelligence” in a smart factory and how it is underpinned by cellular connectivity, which plays a business-critical role. Applications of cellular technology are exemplified with concrete Industry 4.0 use cases, providing business justification and initial steps for how manufacturers can move their digital transformation forward.

3. Calculating Return on Investment (ROI) and Cost of Inaction (COI) by weighing operational costs and savings demonstrates the business impact of Industry 4.0 applications and solutions running on dedicated cellular networks.

4. According to the report, “Over 4.7 billion wireless modules will be deployed across smart manufacturing factory floors to enable over USD 1 trillion in production value by 2030.” Manufacturing executives need to understand why and how to develop the right connectivity strategies to unlock this value.

Industry 5.0: towards a collaborative manufacturing environment

1. In just a decade, Industry 4.0 has revolutionized the day-to-day operations of many companies in the manufacturing sector. Thanks to the technological advances that have emerged over the last few years, these organizations have been able to increase their efficiency and productivity. Now experts are opening the door to a new concept: Industry 5.0. 

2. Manufacturing is one of the biggest drivers of the European economy. Proof of this is that, between 2009 and 2019, it accounted for around 20% of the EU’s GDP. Moreover, according to 2020 data, it is a sector that employs more than 35 million people.

3. Yet, while European industry has decades of experience and is one of the most competitive in the world, it is exposed to an increasingly complex and volatile geopolitical and economic landscape. It is these constant challenges that push it to continually innovate, to further improve its efficiency at different points in the value chain; to be more flexible to the changing demands of the global consumer, and to work to maintain its leadership as a global benchmark for quality.

4. To a large extent, this innovation effort is reflected in the intensive use of new technologies, essential tools for automating, interconnecting and optimizing industrial processes. Indeed, the fourth industrial revolution represents the sector’s ambition to adopt and implement technological advances to cope with an increasingly changing world and economy.

5. Now, after a decade in vogue, it seems that what we know as Industry 4.0 is clearing the way for a new concept that goes beyond pure technological change in the factory. We are referring to Industry 5.0, a vision that is beginning to gain prominence and that has come to place, at the center of the industrial revolution, its capacity to have a positive impact on society.

FDI in renewable energy: A success story

 1. The Covid-19 pandemic has accelerated the transition to net zero, making renewable energy a growing attraction for FDI.

2. The race to achieving net-zero emissions is a reality by now across industries and geographies. The timing is just right for investment in renewable energy and other sources of alternative power to bloom, as the sector has matured.

3. According to GlobalData’s FDI Projects Database, foreign direct investment (FDI) into greenfield renewables and alternative power projects has grown by 40% in the period between 2019 and 2021, going from 444 projects worldwide in 2019 to 789 in 2021.

4. Provisional data for 2022 shows that trend is being upheld with a total 811 projects in the period from January to October.

 

Manufacturing-X

 1. Manufacturing-X is a data ecosystem and industry, academia and policy initiative that aims to optimize and modernize industrial supply chains and production processes.

2. The Manufacturing-X concept represents a new generation of manufacturing technology, incorporating Industry 4.0 approaches and merging technologies such as the Internet of Things (IoT), Artificial Intelligence (AI), robotics, and data analytics. 

3. The objective of the Manufacturing-X concept is to ensure more efficient, flexible, and cost-effective production processes while establishing a highly adaptive manufacturing environment capable of responding to individual customer demands and real-time market needs.

Carbon Border Adjustment Mechanism (CBAM)

1. Starting from 1 October 2023 designated imported goods from outside the European Union (EU) will fall under new EU regulations: the Carbon Border Adjustment Mechanism (CBAM). Referred to as CBAM goods. CBAM will be gradually implemented. From 1 October 2023, you will need to report on these goods, and from 1 January 2026, there will be a registration and payment obligation. This page provides you with more information on this matter.

2. CBAM is a price adjustment applied to imports into the EU for designated goods based on their CO2 emissions in the production process outside the EU. The aim of CBAM is to prevent the risk of carbon leakage. Also, by encouraging the reduction of emissions by operators in third countries (countries outside the EU), global carbon emissions should be reduced.

3. CBAM is an EU regulation and part of the 'Fit for 55' package. The goal of this package is to reduce greenhouse gas emissions in the EU by at least 55% by 2030.

4. Currently, the EU operates a system where producers within the EU have to purchase emission allowances for the CO2 emissions of their products (EU Emissions Trading System, EU ETS). The CBAM price adjustment ensures that these producers no longer face a competitive disadvantage when importing from third countries with lower climate standards.

Grantmaking Best Practices

1. In the last case, grantmakers have only one chance at a first introduction, and that’s very often when grant seekers enter your grant application process. Will the moment be a heartwarming meet cute or a bucket of red flags? Will the right people and nonprofits feel a connection, or will you instead attract bad fits for your mission? 

2. Grantmakers have only one chance at a first introduction, and that’s very often when grant seekers enter your grant application process. Will the moment be a heartwarming meet cute or a bucket of red flags? Will the right people and nonprofits feel a connection, or will you instead attract bad fits for your mission? 

TNB to invest additional RM35 bil over 2025-2030 to beef up grid for energy transition

1. Tenaga Nasional Bhd (TNB) plans to deploy an additional RM35 billion between 2025 to 2030 towards upgrading Malaysia’s power grid, to ensure the infrastructure does not become an obstacle in the nation’s energy transition (ET) endeavours.

2. This is on top of the national utility giant’s RM54 billion non-ET investment allocation for the grid over the same five-year period.

3. This means that TNB plans to invest a total of RM90 billion into Malaysia’s grid in the coming five-year period. This is nearly double the RM46 billion the group allocated for 2018-2024. which comprises RM40 billion for non-ET and RM6 billion for ET.