Business / Industries

China must upgrade industry to remain competitive, experts say

By Li Xiang ( Updated: 2015-03-28 16:51

China must upgrade its industry to maintain its competitiveness in the global value chain and to avoid the middle-income trap, senior economists and executives said on Saturday.

Huang Yiping, a professor at Peking University's school of development said that China will unlikely maintain high growth of exports as it has lost the advantage of cheap labor.

The salary of the country's migrant workers has increased by 10 to 15 percent in the past several years, posing a major challenge to China's industrial structure, Huang said at a panel discussion at the Boao Forum in southern China's Hainan province.

Development of cutting-edge technology, high value-added industry and high product quality is the solution for China's slowing export, he noted.

Dong Mingzhu, the president of Gree, a domestic home appliances manufacturer, said that companies must raise production efficiency through technology upgrades to adapt to the changing international trade environment.

"It is very upsetting to hear our dealers in the Middle East say that products with the label 'made in Thailand' will sell better than those with 'made in China' even though we already have a market share of 50 percent in the region," she said.

China has unveiled the ambitious strategy known as "Made in China 2025" which is aimed at upgrading the country's industry and transform it into a competitive manufacturing power in global markets.

The country's foreign trade grew by just 2.3 percent last year to 26.43 trillion yuan ($4.27 trillion). The growth rate was much lower than the 7.6 percent from the previous year.

Beijing has pledged to promote cross-border e-commerce and increase the share of the service trade in the country's foreign trade.

Yu Guangzhou, head of the General Administration of Customs, said that the government is planning to cut customs fees for exporting companies to reduce their burden and operation costs and to improve customs efficiency.

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