China is investing billions of dollars in its booming technology sector to make sure its economy is able to support the growing number of jobs in the country.
But the country is also facing an unprecedented set of challenges that are making it increasingly difficult to continue with such investments.
The country’s rapid economic growth has created a demand for more sophisticated and flexible technologies, with a growing number also seeking jobs in technology sectors that have not been in the mainstream for decades.
These include data analytics, software engineering, manufacturing and robotics.
But in the wake of the economic slowdown, there is concern about whether China’s rapidly growing technology sector can continue to provide a secure and reliable future for its workers.
Key points:The government wants to invest $US1.5 trillion ($1.9 trillion) in the technology sector by 2020The US, Japan and others have invested heavily in the sectorBut experts say the pace of investment has slowed, with some analysts forecasting that investment could slow to less than $US300 billion ($325 billion) by 2020.
Experts say that if the pace slows further, the country will have to rethink the way it invests.
“The government has been talking about a new industrial technology strategy for the last decade or so, but there’s not really been a coherent strategy,” said David Leopold, an economist with the International Monetary Fund.
“We’re seeing this in China, too.
They’re really trying to take a lot of the ideas that are currently being developed and put them into practice.”
A new strategyThe government recently unveiled a new strategy for industrial technology investment that is designed to be flexible and responsive to the country’s needs.
It calls for investment in key areas such as IT, manufacturing, telecommunications and transportation.
The strategy says the country should focus on the creation of jobs by investing in areas like manufacturing, data analytics and healthcare, as well as the development of new technologies.
The plan has been welcomed by economists who believe it will ensure that the country can keep up with the demands of its rapidly growing economy.
“If you look at the economy as a whole, we are now in the midst of a very rapid growth phase and we’re going to have to get much more sophisticated in our investment strategies to keep up,” Mr Leopodd said.
Mr Leopolder said China’s economy has grown at about 12 per cent a year over the past two decades, and he predicted that it would continue to grow at about that rate in the future.
“What is more, China is one of the fastest-growing economies in the world.
There is a lot to be gained by investing,” he said.”
It will make a lot more sense to invest in those sectors that are likely to have a greater payoff.”
A more robust investment environmentThe strategy also includes measures to boost the countrys economic growth, including creating a new investment fund that will invest up to $US400 billion ($500 billion) in infrastructure projects.
It also calls for China to diversify its investments into the technology sectors, saying that companies should focus their spending on areas that offer a more sustainable future for the country than those that have been in place for decades or decades.
“There are some areas that are still in the pipeline, but the ones that are the most likely to come to fruition are those that are really going to help the Chinese economy achieve the kind of growth we want,” Mr Laopold said.
The government is also investing $US800 billion ($1 trillion) into the education sector, to help schools achieve high-quality teaching.
“But there’s a lot that needs to happen.
Education is a very important area, but it’s not a panacea,” said Wang Jianwei, a professor of economic policy at the National Chengchi University in Beijing.”
And China needs to diversification.
It’s not about the Chinese as a nation.
It is about the students.
And we need to diversified investment.”
The strategy will also see the government provide a number of incentives to help attract talent.
The Chinese government is investing $10 billion ($8 billion) to create new jobs in China in sectors such as software development and manufacturing, and it is encouraging universities to hire foreign graduates.
In its latest investment report, the central government said it would invest $1 trillion ($940 billion) over five years in the new Industrial Technology Research Fund (ITRF).
It will help fund universities to develop technologies that are able to be exported to other countries and boost the Chinese economic growth.
“That means they will be able to export some of these technologies to the rest of the world and it will help the economy grow,” said Professor Wang.
“These investments are really very important because they give the Chinese government a strong hand.”