VIRTUAL SHOPPING: A woman conducts an online payment via a two-dimensional bar code at the 2013 China Internet Conference, held in Beijing from October 13 to 15 (WANG ZHEN)

As the world economy struggles in its tenuous efforts to bottom out, China is advancing on a delicate rebalancing act of its economy, amid a prolonged slowdown. With pressure mounting to find new growth engines, economists, officials and a range of business people gathered at the 2013 World Industrial and Commercial Organizations (WICO) Forum, held in Beijing from October 28 to 29. At the top of the agenda were how to add more value to manufacturing, and find ways to increase information consumption.

Adding value

Since the reform and opening-up process began, China's industrial sector has remained airborne, with the country occupying the position of global leader in terms of its manufacturing output, with annual industrial added value exceeding 20 trillion yuan ($3.28 trillion).

Despite double-digit growth in factory output over the past three decades, China's industrial growth depends mainly on cheap labor costs, external demand, and investment, sometimes even at the expense of the environment.

To that end, the Chinese Government has called for the refinement of the industrial sector by creating more value-added products and services.

As Chinese Premier Li Keqiang pointed out during the 2013 Summer Davos, the "miracle" of Chinese economic development has shifted to a "second season" from its "first one." The essence of this shift should be from a quantity-speed model to one of quality-benefit.

Li Yizhong, Chairman of the China Federation of Industrial Economics and former Minister of Industry and Information Technology, said China should steer away from the old path of rampant industrial expansion and focus instead on value-added output.

Li Yizhong said China's industrial sector faces many challenges, including rising costs, a lack of innovation and core technology, mounting restrictions from the environment and natural resources and competition from both developed economies and developing countries.

"For instance, China produces 1.18 billion mobile phones, 350 million personal computers and 130 million TV sets every year. However, 80 percent of the high-end chips rely on imports, costing China $200 billion a year, more than what China spends on crude oil imports every year," he said at the 2013 WICO forum.

In addition, the extensive model of industrial growth has led to increasing emissions, causing severe air, water and soil pollution.

"Chinese energy consumption per unit of GDP is twice that of the global figure and four times that of developed countries. We can't continue on this old path," warned Li Yizhong.

"China will not achieve industrialization until 2020. We shouldn't replace the manufacturing industry with a service industry too soon," he said, adding that China should instead transform or upgrade traditional industries and cultivate strategic emerging new industries to avoid the industrial sector from becoming marginalized.

"Besides, industrial players can extend their businesses to after-sales services, such as maintenance, long-distance consultation, industrial designs and information services," he said.

Shenyang Blowers Works Group Co. Ltd., an equipment-manufacturing company based in northeast China's Liaoning Province, is a good example of seeking new growth drivers by increasing value-added output amid economic slowdown.

Su Yongqiang, Chairman of Shenyang Blowers, said the company invested heavily in innovation by setting up research institutions, upgrading software, international communication and formulating a set of incentive policies to encourage innovation from its staff members.