Designed in China Talking Business

It was manufacturing that make China rich.

And now, China knows that it needs to innovate to keep growing. China

has always been seen as a place that copies its way to success, not a

place where creativity thrives. In this episode, I will be looking at

whether China's plans to become an innovation superpower are realistic.

At a busy traffic junction, the tribute to the man who started the

Chinese miracle. He is credited with the economic success of modern

China. It was here that he first started experimenting with high tech

economic zones. Today, this city is home to some of the country's most

dynamic companies, which is why I have come here, to find out but they

are thinking. In the last 30 years, consumerism has become king in

Communist China on the government's orders. And in the frenzied pursuit

of profits, it didn't matter what was produced was cheap or a

knock-off. This company claims it is the third largest television

manufacturer in the world and amongst the top five makers of

mobile phones. TCL sold more than 70 millions of these panels last year.

Half of them were sold overseas. It is this kind of manufacturing that

has made China rich over the last few decades, mass-producing

affordable goods on a monumental scale. But the made in china brand

doesn't exactly come with the stamp of quality. In fact, it is quite the

opposite and Chinese companies trying to innovate have had to

battle against the perception that something that has been designed in

China simply isn't good enough. But now TCL knows it needs to innovate

to keep producing new products and beat the competition. It is doing

that by automating on its factory floor, replacing its workers with

machines. Some of the production lines here have already fallen

silent. This senior manager tells me it is all part of TCL's upgrading

process. TRANSLATION: This year, we are introducing automated production

lines. It will just be the first phase but we will be cutting about

70% of existing workers. This is happening across most of our

industrial processes. TCL isn't getting rid of all of its labour, it

says these workers will just be redeployed elsewhere in the

production chain. But how will this automation help TCL become a higher

value more efficient company? I went to one of the fully automated plants

to find out. We have had to put on all of this protective gear because

it is a dust free environment in there and we don't want to

contaminate any of the machines which is why we are taking all of

these precautions. It is the ultimate in high-tech fashion. OK.

So, I'm not quite sure what happens in here. Only after all of that I

finally cleared to gain access to the production floor, accompanied by

one of their engineers. It is read that anyone is allowed in here, it

tells me, because these machines are so delicate and valuable. Their job,

to produce LCD panels which TCL used to import. How many screens do you

produce in this factory in one day? 5000. From all of these machines?

Yes. I have been to many factory floors across China but I have got

to say, it is read to see something is automated and high-tech as this.

This is very much part of how the new China sees itself moving higher

up the value chain, less labour intrinsic. That at the end of the

day, all of this is producing something that is remarkably like

what old China has always produced. Ultimately, TCL is making television

screens. So, just how is TCL changing course? A question I put to

the boss of the firm. TRANSLATION: We used to be just a product

manufacturing company but now consumer demands are very different.

Now, after we sell the phone, we still need to provide services. It

is the same for smart TVs. Our revenue from services has grown

quickly in the past few years. I know that TCL is trying to innovate

at the criticism is that other Chinese companies, the majority

aren't, and they are not coming up with new ideas, they are not trying

new things, they are simply copying. Why is that? TRANSLATION: The path

that Chinese countries in this industry are taking is similar to

Samsung or LG 20 years ago or the path Japanese companies took 30

years ago. If compared to the life of Samsung, I believe there is still

a gap for Chinese companies to innovate today. But that gap is

narrowing. I cannot accept some comment from Westerners, especially

politicians like Vice President Biden who openly said Chinese

companies don't have liberty to innovate. That kind of comment is

biased and not objective at all. China has no shortage of talent but

so far it has relied on imitating others, rather than coming up with

original ideas. I have come to this artist on clay where painters are

often hired to reproduce famous works of hotels and other customers.

Just like in the factories that make China successful, it is the art of

copying here that has always been prized. But now some companies are

trying to paint a new future for Chinese brands. Chinese companies

trying to innovate these days are coming up with products inspired by

their wildest dreams, stuffed you didn't even know you needed. This is

Chinese train maker BGI's main flagship store. Ten years ago, this

company is not that as an idea, born out of a passion that the frowned

had four drones. Today, it is worth more than $10 billion. 70% of the

commercial drones sold in the world are made by DGI. It is not just a

market leader globally but it is also at the forefront of design and

technology. DJI is no longer seen as just a Chinese firm. It has gone

global and just a few months ago scored an international coup by

tying up with social media giant Facebook to do live broadcasts from

drones. I connected with one of DGI's American staff members but had

to access Facebook on a VPN, that is a virtual personal network which

effectively disguises the physical location of your computer. That is

because Facebook is banned in China, along with Google and Twitter and

many other international sites. What is the plan for the partnership

between DJI and Facebook in the future? How do you see it expanding

Briton Mark I think the plan for the future is to partner with

celebrities... That all sounds great and quite

ambitious but just in the time that we have been talking, there have

been a number of dropouts and delays on the line. Connectivity seems to

be a major issue. Is that a major problem in China?

And why is that? So, this is the Ronan. It is just

one of the many challenges that Chinese firms face but Michael

Perry, director of global partnerships at DJI, says that

Chinese government is recognising how important innovation is full

China's future. We are the first company to make an entire new

product category. There was not a consumer drone before. We have been

very fortunate to be able to grow very quickly internationally and

then also look inwards at China where they see the potential for

this category and see the potential for China to be leading a brand-new

category of technology that is going to be transformative across the

world. Part of that is about China and the new direction it is going

in, in terms of investing animation and partly it is about what a unique

place this is for hardware development, software development,

and addressing global market with consumers drones. Just a two-hour

dry away, and I get a chance to see the drones in action. Does it seem

like at day four drone weather? How often do you normally come up here

to do the inspections? Drones are radically changing the

nature of many industries and being used to make what were once

physically demanding jobs much easier. This is the team from a

power grid who have been using DJI's drones to inspect transmission

towers high up in the mountains. Just a few months ago, their jobs

were far more change address and much harder. Did you have to climb

all the way up there by yourself? Yes. Very hard work. What are you

looking for we can see the details. Wow, that is

very close, that is a remarkably clear image. Yes. Do you miss

climbing up there? No. You don't miss going up all that way. Yes. And

this is in the only real life use for the drones. They are also being

developed to spray crops on agricultural land, study Wales and

allow scientists to test for DNA and in search and rescue operations. But

competition to DJI's business is growing, and not just from the US,

increasingly the threat is coming from inside China. We think that we

have a technological advantage of a few years. There has not been a

company that has been able to have the same combination of ease-of-use,

of portability, of flexibility and reliability that DJI has. You see a

lot of concept videos, you see a lot of demos but what a lot of people

struggle with is actually creating the product that does what it is

opposed to do. China has put innovation high up on the economic

agenda. The Chinese Communist Party is under pressure to find a new

formula for the next phase of this country's economic growth. In 2006,

Beijing announced a new vision for the future. That by 2020, China will

transform into an in innovative society and that by 2050, it would

be a world leader in science and technology. This country certainly

has the political will and the money to do this. There is no shortage of

funding here for a good idea. I have come to Beijing to find out how this

sort of government mandated top-down innovation approach and actually

work. It is a debate venture capitalist Lee often gets torn into

with critics of China's methods. He was the former boss of Google on the

mainland and now invests in start-ups here. For Young

innovators, he has got rock star status. Many flock to him with their

latest ideas, hoping to start it big with their support. He says the West

is underestimating China's ability to innovate. 20 years ago, most of

China's success comes from any late in successful products, as did the

Japanese products in the early days, and Chinese works have largely grow

out of that and have become very strong, I wouldn't say innovators

yet, but certainly product development and in building useful

products that generate economic value. That Chinese companies are

all good examples, they are building products as good as anybody off the

world, like DJI Ali baba. I think that is the first step. Will there

be an Apple or a Google in China? That remains to be seen. What is the

biggest challenge to Chinese innovation? I think breakthrough

innovation will be difficult because the Chinese innovation -- education

system, as improved as it has been, is still focused on helping you with

the drills that makes you very good at building something that not so

good at break than open. The education system teaches you more of

the what and less of that what -- how and very little of the wife. It

is fundamentally difficult to become creative. There are some companies

that are trying to break out of this mould. Early-morning rush hour at

this office in Beijing, a chance to see the next generation of Chinese

workers. More silicon Valley than production line. This office used to

be an odd factory, now refashioned into a multi-million dollar mobile

software land. Old China making whether the new dawn of Chinese

innovation. And this is the man behind the success of cheater

mobile. Only 38 years old, he is part of the new breed of Chinese

entrepreneurs who want to go global from the start. TRANSLATION: Chinese

mobile products are pretty good. I was convinced that my idea was

sound. But every time I brought it up to my colleagues, the response

was OK, good, and the men went back to their own work. Until one day,

and put them all to the US for a conference. That night, we stayed in

a Hotel and bought some wine and after a few glasses, I said let's

not just Chinese market, let's go for the overseas market, especially

the US. They must all have been drunk because they all agreed. And

so we embarked on this path to go global. 70% of the mobile company's

revenues comes from overseas. It started by making mobile security

software that now develops applications and games. Today, the

US market is our biggest source of overseas revenue. The mobile

internet ecosystem is much more mature than China's so it is easier

to incorporate with the likes of Google, Facebook and Apple. We can

also learn a lot from American businesses to develop ourselves.

They have developed a mobile broadcast software to compete with

the likes of periscope and Facebook live. But while Chinese developers

are amongst the best in the world it still be hard to find creative here.

Chinese education emphasises technical knowledge so students here

are very good in maths and languages. American education is

about encouraging your vision, your dreams, your independent thinking.

So, from a very young age, Americans have a point of view about the

world, their own perspectives and unique thinking. It'll be harder for

us to achieve the kind of American worldview and vision and risk-taking

that are required in this generation. Perhaps in the next

generation, it may be possible. But change is coming with small yet

significant steps. This educational lab is a partnership between Alan

University and the Lego foundation. Here, children are taught to learn

by doing, not by road. Researchers are experimenting with ways to teach

China's next generation and improve the current education system.

TRANSLATION: When we did this before, we had our teacher leading

us but today we are doing it by ourselves and I am nervous, I am

worried I will do it wrong and I keep making mistakes. I will get

better with practice. This place is run by a woman who was educated at

Stanford University. She believes play -based education is important.

If they have fun, it is easy, and then they in the future, they will

represent the same spirit and behaviour and mindset and attitude.

That can definitely bring the new energy to the society and of the

school, to the organisation. So, can you help me find out how many of

these kids would like to be inventors when they grow up? Can you

ask them? One, two, three, four, five. Five little inventors at this

table. Pretty impressive. China 's for Miller for success has always

been to copy, build and sell cheap and then to do it all over again. --

form letter success. That is helped China transform into the world's

second-largest economy today. But from the places I have visited the

people I have met, I found a new China that is quietly emerging on

the global stage. But China which doesn't just replicate but it tends

to design and create. The China web despite censorship in government

controls on the internet, some innovative ideas have been born. And

China where its people are hungry for global recognition and respect.

But these examples are still the exceptions here. If the Chinese

government once real innovation, it may have to ruling which control,

open up access to information, and our authority, even its own, to be

challenged. Next week, join us in Johannesburg

as we look at why the largest African economies are struggling.

Hello, there. For many of you, not a bad start to the weekend, especially

across the western half of the UK. This was the scene deceiving in