Abstract:Strengthening the competitive advantage of manufacturing and promoting its high-quality development are the key points to build a modern industrial system. This study uses international market share (MS), revealed comparative advantage (RCA), trade competition index (TCI), and price index (PI) from 2005 to 2020 to analyze the evolution of manufacturing competitive advantage and its main sources in major countries. The main findings are as follows. China's labor-intensive industries maintain a strong international competitive advantage, and the international competitive advantage of some capital and technology-intensive industries is increasing. The capital and technology intensive industries in Germany, Japan, and United States have maintained a strong international competitive advantage, but some of them have shown a downward trend. The international competitive advantages of capital and technology-intensive industries such as electrical machinery and equipment manufacturing, special equipment manufacturing in China mainly come from product prices, while those in Germany, Japan, and United States mainly come from technology. Four policy suggestions are presented in this study for strengthening the competitive advantage of manufacturing: promoting technological innovation focusing on industrial basic capabilities; modernizing the manufacturing industry chain, supply chain, and innovation chain; accelerating digital, green, and service transformation; and increasing level of international cooperation and cross-border operations.