China rides the crest of a digital wave

It's not just phones, it seems that everything wants to be "smart"; shoes, clothes, cars, even manhole covers.

China's Li-Ning, a sportswear brand, announced on Sina Weibo Monday that it has teamed up with smartphone maker Xiaomi to manufacture "smart" running shoes.

The smart shoes allow runners to log their exercise, analyze their technique and obtain professional guidance.

It is just the latest of many moves by Chinese manufacturing enterprises to ride the digital wave.

Last Thursday, China's leading carmaker, SAIC Motor and Alibaba Group declared that they were teaming up to develop an Internet-enabled car featuring Alibaba's Yun operating system, Xiami music, AutoNavi navigation technology and Aliyun cloud computing.

China has almost 650 million Internet users and over 500 million use their phone to get online. The Internet has created opportunities in all sectors of economy - good news for a country under considerable downward pressure.

A McKinsey Global Institute report last year hypothesized that, in China, the Internet could fuel up to 22 percent of GDP growth until 2025.

China's rise over the past two decades relied on enormous capital investment and a huge, cheap labor force, but that can't last forever. The Internet growth model is driven by innovation and quality production.

On March 5, Chinese Premier Li Keqiang said China will not only implement the "Made in China 2025" strategy, but develop an "Internet Plus" plan based on innovation, smart technology, the mobile Internet, cloud computing, big data, and the Internet of Things. Manufacturing processes will shift from those of quantity to those of quality.

Fan Youbin, president of Everstar, knows how Web technology can change the lives of enterprises as well as consumers. Three years ago, Everstar, a clothing manufacturer based in south China's Guangdong Province, watched grimly on as clothes exports slowed.

The company has since been transformed from a traditional manufacturer into a modern enterprise that allows customers to design their own clothes and try on them in a virtual fitting room at its online store.

"Everything is done online. Customers can receive their clothes within three days of placing an order," he said.

Wang Wenjing, head of an Internet service provider for enterprises, believes the digital economy means better product development, supply-chain management, sales, marketing and customer interactions, but the process is likely to put some workers out of a job and needs government support on cyber security.

Meanwhile, in the east China city of Hangzhou on Monday the first batch of "smart manhole covers", featuring anti-theft devices, shock absorption and noise reduction, went on the roads. The manhole cover's "smarts" come from an electronic tag which sends an alarm signal if it is tampered with

It is indeed, just as Wu Hequan of the Chinese Academy of Engineering predicts: The digital economy will not just impact on manufacturing but on all sectors and ultimately help China reach the goal of sustainable growth.