Push continues to ascend value-added chain as industry swaps toys for tech

BEIJING — Su Tongqiang and his ceramics company in Shandong province have bid farewell to wafer-thin profit margins, making an extraordinary transformation thanks to the business dynamics of adding value.

“Some years ago my company made a meager profits of less than 2,000 yuan ($290) from shipping more than 70,000 cups overseas in one container,” Su said.

“Climbing the value chain was the only way to survive,” added the entrepreneur, who owes his company’s robust health to years of research and development. The company now holds more than 100 patents.

“The profit from one expensive cup is equivalent to dozens of cheap ones,” Su said.

The transformation of Su’s company is testimony to China’s broader economic restructuring.

China is moving toward an economy based on innovation and services, reducing reliance on investment and exports of low value-added goods.

“China’s transition to slower but structurally rebalanced growth continues,” the World Bank said in a report earlier this month, noting that economic growth will continue to moderate as capacity is cut and credit is kept on a tight leash.

The revenue of Su’s ceramic company grew 30 percent in the first quarter. The string of upbeat macroeconomic data in the first quarter, meanwhile, also pointed to a firming in the broader economy and

Consumption is playing a more prominent role in driving growth...” Zhang Liqun, a researcher with the Development Research Center of the State Council, China’s cabinet

progress in economic restructuring, giving policymakers some room for maneuver.

GDP growth in Q1 stood at 6.9 percent, up slightly from 6.8 percent in the previous quarter, with 77.2 percent of it driven by consumption, 12.6 percentage points higher than the 2016 level. The service sector rose 7.7 percent year-onyear, out-pacing a 3 percent