Tech exporters turn to R&D as business weakens

Even though China is focusing more on innovation and technology to drive its economy and foreign trade, a growing number of high-technology enterprises have seen exports fall.

Lower overseas demand, increased labor costs and tough competition are to blame, said Yu Xiaofei, a business manager of Dongsheng Motor Group. "We did many things to cope with the situation, such as investing more on research to develop new products," he said.

The Shenzhen-based company, which designs, makes and sells mechanical and electrical products, said business contracted more than 10 percent year-on-year in the first three quarters.