Where should China's private firms go amid slowing economy?

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Chinese private business leaders gathered in Taizhou in eastern China's Zhejiang Province to discuss their next move in a slowing economy. This comes as Chinese President Xi Jinping vowed that the government will continue to protect and support the private firms.

The small city of Taizhou was the birthplace of China's first private automaker Geely, and the hometown of the company's legendary owner Li Shufu.

In the 1990s, Li started his first business here -- a small photo studio. Then he operated a local refrigerator maker, and now is the owner of a fast-growing car company making a string of stunning acquisitions of foreign giants, including Volvo and Daimler.

At the Taizhou Forum of China's Private Economy Development, Li is one of the most high-profile speakers.

"The purpose of our acquisitions is to raise the technological capability of Geely. In the future, China's private firms can no longer rely on low costs to compete with global brands. It will be a higher-end competition in technology," Li told CGTN.

The low labor costs were once China's competitive edge in global trade, but not anymore.

We visited the assembly line of China's leading private clothing firm Hodo.

Ten years ago, China would sell hundreds of millions of shirts to the U.S. to earn enough money to buy a U.S. aircraft. But the company's chairman says this model can no longer continue.

"Internationally, the China-U.S. trade war has caused huge uncertainties, and domestically, labor costs are rising fast. We, as private business owners, must raise the added value of our products while at the same time changing our marketing strategies," Zhou Hailing, CEO of Hodo Group, said at the Taizhou forum.

And this seems to apply to all manufacturers.

Made-in-Taizhou toilets were known for low prices, but today, the company says it is investing heavily in research and development.

Despite the progress on innovations, China's private sectors are still facing some old frustrations, including high tax rates and difficulties in getting loans from state-owned banks.

Fortunately, authorities have vowed more policies to support the private sector that creates 90 percent of jobs in China.