The industry of counterfeit goods (shanzhai) in PRC has grew and flourish since the start of the gaige-kaifang era. In 2001 PRC  became the member of WTO which means China have to obey the law of international trading including copyright protection. However, it did not stop the growth of the shanzhai industry. Even until now, the product that they make have become more diverse. This phenomenon brings a question on “why and how the shanzhai industry keeps growing and what is its role in the Chinese economic progress?”. These questions are the main issues that will be discussed in this paper. Since in this last decade Indonesia have been overrun with products from China, then it will also discuss the extent impact of shanzhai industrial growth to Indonesia’s economy. This research was conducted by using historical method, which includes heuristic, critic, interpretation and historiography. From the research that have been gather so far, it has been revealed that the shanzhai industry do indeed have an important role for China’s economic progress. On the other hand, the industry could continue to survive because there is a strong interconnectedness with Chinese history and culture. Its development leads strongly towards the creative industry, but due to its vigorous and massive marketing, and accompanied by the agreement of ACFTA it has render a negative impact on the Indonesian economy.