China is currently the world’s largest producer of manufactured goods. During the first quarter of 2015, its global share of manufacturing output was 25%, an increase of 20% from the 1990s. The mass production of electromechanical equipment, clothing, textiles and furniture makes China the world’s leading exporter of factory-produced goods. While manufacturing is a key pillar of its economic growth model, China is presently upgrading its economy to develop and support new investment opportunities.In particular, the Chinese government is encouraging targeted investment in research and development (R&D) to promote domestic innovation and entrepreneurship.
The comparative advantage of China over other trading nations has been its low-cost, labour-intensive manufacturing sector. As the purchasing power of Asia’s rising middle class continues to grow, China will continue to be a key exporter of manufactured goods. At the same time, the transformation of China’s social, political and financial landscape is creating new investment opportunities in a range of emerging sectors. In a move to diversify its current industries and ensure a sustainable growth strategy, China is directing an increasing amount of capital towards the development of high-end, technologically advanced products. Former Chinese President Hu Jintao stated in 2006 that one of China’s key goals is to develop innovation and entrepreneurship as a pillar of its economic model.
In 2006, the Chinese government announced its indigenous innovation policy to promote the creation, commercialisation and eventual export of high-end technological goods.
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