Wu Guangqiang

    jw368@163.com

    CHINA is seeing off the Year of the Horse and embracing the Year of the Goat. People who were accustomed to seeing China’s economy leaping forward at a double-digit growth rate were disappointed to see that “the horse” (2014) trotted ahead with a moderate increase rate of about 7.4 percent in GDP, the lowest in the past 25 years. The world has felt the chill of China’s economic slowdown. As the largest consumer of raw materials produced all over the world and the largest industrial goods producer, China has an increasingly strong impact on the rest of the world.

    Under no circumstances can China keep developing at a pace beyond its capability. The quantity-oriented and extensive development pattern has come to an end. On the other hand, a hard landing or slump is unacceptable. A sustainable, people-benefiting and environmental friendly development pattern is the only solution.

    The solution is what China’s leaders have been talking about: A “new normal” of economic development. “New normal” was first popularized by California-based bond fund giant Pacific Investment Management Co. to describe below-average growth after the global crisis. But in China, it was President Xi Jinping who first put forward the notion during his inspection tour in Henan Province in May.

    China’s “new normal” is characterized by a shift from high-speed growth to a medium-to-high one, a shift from focusing on quantity and speed to quality and efficiency, a shift from stressing production expansion to improving current production, and a shift from growth being driven by conventional engines to increasingly driven by new ones such as innovation and the Internet-based consumption.

    One aspect of the “new normal” is the vibrant trend of starting tech companies that are swiftly sweeping across the country.

    With a host of administrative reforms aimed at reducing bureaucratic red tape and encouraging entrepreneurship, starting up new businesses has become a fad, especially among young people.

    A visit to Zhongguancun gives an insight into what is going on in China at the grass-roots level and what impact China’s “new normal” will have on the rest of the world.

    A technology hub in Beijing and dubbed China’s Silicon Valley, Zhongguancun is morphing from an electronic products sales center into a paradise for young people with entrepreneurial dreams. In the first half of this year alone, the 488-sqkm zone has seen the birth of over 9,000 tech companies, 49 new companies every day. People born after 1990 have emerged as the main force in starting up new businesses. Many young people with bright ideas started their businesses from scratch and saw some initial successes.

    In 2010, Yan Wenwen, together with three partners, rented a 30-sqm office and started developing his first product: a wearable device used to help golfers improve their training levels. After numerous setbacks and failures, he and his team’s efforts were amply rewarded: the product GolfSense — now very hot worldwide — was launched in 2012 at Apple’s North American stores and the sales volume exceeded 100 million yuan (US$62 million) that same year. GolfSense is now outselling all other similar products.

    Behind these enthusiastic young entrepreneurs is support from the government and other social organizations, chiefly venture capital firms.

    A network of innovation incubators in Zhongguancun is playing a key role in making tech start-ups successful. So far, more than 10 companies have been successfully incubated and have been listed overseas.

    Guo Hong, director of the Zhongguancun Management Committee, predicted that in 15 to 20 years, China will become the world’s leader in innovation. His prediction has been supported by a report by the World Intellectual Property Organization that claimed that in 2013, there were 2.57 million patent applications worldwide, 32 percent of which were from China, more than any other country.

    Zhongguancun-like innovation bases are mushrooming in Shenzhen, Hangzhou, Guangzhou and Shanghai. A new horizon is in sight.

    (The author is an English tutor and freelance writer.)