Innovation and sustainability are the stepping stones that can upgrade industries and services and cement the nation's future

China has begun the next phase in its development as a leading global country. Structural reforms and partial liberalization are easing its reliance on growth through investments and net exports mainly driven by manufacturing. Instead, a model based more on domestic consumption and services and strongly driven by innovation is emerging.

What China will do next to maintain its economic vigor and continue spreading wealth among all its citizens will shape its outlook for generations to come. The challenge is that the factors that have served it so well in the past are different from those that will help it succeed in the future.

It is the culmination of a journey that began in the 1980s under the leadership of Deng Xiaoping. The economic and social development he initiated, a form of centrally steered market system, has produced the fastest economic growth the world has ever seen sustained for three decades. It has made China the world's second-largest economy and has lifted about 650 million people out of hunger and extreme poverty.

The model was based on the mass manufacturing of certain goods, by using mainly brought-in technology. China has become so incredibly good at manufacturing, with its ultra-efficient supply chains and modern infrastructure, that it produces more than 25 percent of all the goods made worldwide today. Interestingly, this was also the case some 200 years ago.

However, China's dependency on manufacturing, investments and net export as the main growth model is becoming harder to sustain. China's growth has slowed somewhat in recent years, although it is still very high. The expected growth rate of about 7 percent a year will practically double the size of its economy over the next decade, effectively resulting in another China. However, this growth will also have an impact on the nation's ability to address its most pressing long-term needs.