Trade tensions, geopolitical conflicts, and economic uncertainties are some of the challenges the world is facing today. Amid these issues, the Summer Davos kicked off in Tianjin, the Chinese mainland, this week, gathering thousands of representatives to strengthen economies through collaboration and innovation.
As the world’s second-largest economy, China is shifting its focus to new quality productive forces. With innovation at the forefront, these forces emphasize high-tech, high efficiency, and high quality, aligning with a new development philosophy.
“Innovation is the secret to economic growth. It is the immeasurable aspect that allows economies to escape developmental traps. Countries that invest in research and development, education, and skill training do well,” said Jeffry A. Frieden, Professor at Columbia University.
The Global Innovation Index 2024 shows China rose from 12th to 11th place in just one year, making it one of the fastest-advancing economies of the past decade.
From AI advancements to breakthroughs in quantum computing and biomanufacturing, China is charting a new economic map for the future.
“We are seeing China play a crucial role in the global EV industry, launching the No.1 market for electric vehicles. China is also actively exploring next-generation technologies like hydrogen energy, nuclear fission, and nuclear fusion, which are important for us as investors. Additionally, China has been innovative in the medical technology sector,” said Amit Kakar, Head of Asia at Novo Holdings.
“We believe that China—with its state-of-the-art manufacturing, especially in precision manufacturing, innovation, and new tools like AI and robotics—is transforming how the world views China, not just as a manufacturing center but as a hub of innovation,” Kakar added.
Innovation is powering China’s economic growth. In 2024, the industrial added value of national high-tech zones accounted for 24.1 percent of the country’s total. The added value of core industries of the digital economy rose to about 10 percent of national GDP last year.
“We survey chief economists from around the world every quarter. There are only two regions where they are positive and optimistic: South Asia and China,” said Saadia Zahidi, Managing Director of the World Economic Forum.
“There is a strong view that there will be moderate or strong growth. Most believe that China will be close to its target of 5 percent growth, if not reaching it. Overall, there’s quite a positive outlook for what will be happening here,” Zahidi added.
China’s push for innovation is not just for its own sake. The country has been expanding opening-up and cooperation in the science and technology sector, serving the well-being of the international community.
“China plays a very important role. It is, after all, the world’s biggest exporter, the biggest manufacturing power, and will soon probably be the world’s biggest economy. I think that China plays a major role and will have a big impact on how the world moves forward,” said Frieden.
Despite protectionist headwinds, China is committed to innovation and cooperation. This may explain why the country’s economic growth is higher than anticipated. Could this also be the solution to the challenges the global economy is facing right now?
