The World Economic Forum’s 2014 Annual Summit of the Young Global Leaders in China included visits to the internet giants and technology start-ups. To the surprise of many, Beijing and its Zhongguancun district, in particular, is also an innovation hub amid China’s information consumption boom.

The Silicon Valley-like Zhongguancun is the home of established Chinese internet players, the China offices of global companies such as Google and, most notably, numerous start-ups. China seeks to develop a more sophisticated economy beyond assembly lines, exports and government spending. Would-be entrepreneurs are creating a remarkable wave of innovation that challenges the long-held perception of “made in China” copycatting.

The first generation of China tech start-ups was mostly about the internet and copycat versions of Western sites. However, in the digital economy 2.0, the second generation is about China’s booming online consumption and broad mobile economy, with more innovative business models and advanced features.

From the application side, China’s market has evolved in a very different way from the Western world, moving more aggressively into mobile. Mobile commerce users can manage their money, order taxis and even invest in money market funds, all from their smartphones. In developed countries, these activities are not as widespread on mobile. For example, some apps in China focus on voice input, allowing users to bypass the cumbersome process of writing Chinese characters on phone screens.

On hardware devices, Chinese players have developed smartphones that offer both competitive pricing and technological edge. In addition, they are also expanding overseas to similar emerging markets where millions of consumers are replacing their basic cellphones with smartphones.

The Chinese versions of affordable Android handsets with competitive features are posing a threat to Samsung and Apple. In fact, China’s massive electronics supply chains, well established from the “made in China” era and getting increasingly sophisticated, proves invaluable for the new convergence between hardware and software. With the supply chain nearby, early-stage inventors could easily tweak their pilot products at factories, giving them more opportunities to fully develop the finished product.

Finally, data in the digital era is becoming a significant asset, although rarely recorded on corporate balance sheets; although that may simply be a matter a time. With a 1.35 billion population and 618 million internet users in China, the data in China’s consumer market is primed for surging growth. It is the oil of the information economy and the foundation of upcoming Chinese-designed products, or even new business models, for a global audience.

Twitter Chief Executive Dick Costolo visited Shanghai in March. This may be a harbinger of others who will come to China to look for new features, products or business models. The story of China is rapidly transforming from the old “Made in China” factories to the younger “Created in China.”

Author: Winston Ma Wenyan is a Managing Director and Head of the North America Office of the China Investment Corporation (CIC).  

Image: A man talks on a mobile phone near the Pudong financial district in Shanghai July 17, 2014. REUTERS/Carlos Barria