The value of investing in areas such as research and development should not be underestimated; the strategic development and advancement of the industrial structure depends upon such investment (Chart 5). If an industrial sector with competitive advantage is developed, this will translate into increased strength in the export business.
Nurturing the service sector and urbanization Turning our attention toward the issue of domestic demand, it is clear that the key to offsetting the saturation of demand for manufactured goods is to nurture the service sector and raise its productivity. The service sector is often labor-intensive, and as a consequence, tends to yield lower productivity compared to manufacturing industry.