In March 2015, the China-led International University Innovation Alliance Start-up Competition UK held its inaugural session in London, with UK startups pitching innovations specifically to Chinese investors. Sun Wansong, Deputy Director of China’s Investment Promotion Agency of Ministry of Commerce, explained in his opening speech that China is proactively turning itself from the “world’s factory” into a creator of innovation-driven ideas. Even though China still accounts for making about 80% of the world’s air conditioners, 70% of mobile phones, and 60% of shoes, the country has been gradually shifting away from the role of manufacturing nation. This is perhaps not surprising since labour cost has been rising continuously in China and companies are reallocating their production facilities to neighbouring Indonesia and Vietnam, whose labour wages are only about 31% and 24%, respectively, of that of China. While other Asian countries are busy competing for China’s manufacturing businesses, China has set itself on the path to engage higher value activities that offer better profit margin, including deploying robotics to increase efficiency and reduce dependency on cheap labor.
