This manufacturing hub is not merely honeycombed with low-end factories: It is also engaged in new, painstaking efforts to build a different image by fostering hi-tech industry and innovation.

Dongguan began with garments, footwear, toys and Christmas trees, then moved into consumer electronics. Now it also assembles communications equipment, telecom switches, routers and automobiles.

That transformation can be seen in Songshan Lake Sci-Tech Industry Park, an hour's drive from the airports in Shenzhen or Guangzhou, South China's booming economic powerhouses.

Designers from Guangdong South China's Institute of Industrial Design based in Dongguan display their projects. [China Daily]

Apart from being so close to the "world's factory", the park embodies that new image Dongguan is building. From the beginning of the new century, Dongguan has started to remodel itself by deciding to move up the manufacturing chain.

"We have laid solid foundation to do so," said He Yuepei, director of Dongguan Sci-Tech Bureau.

He said fewer than 400 nation-level hi-tech companies and 1,500 private hi-tech companies of various scales have been set up in the city. In 1978, the city had only one registered engineer; now, that number has already surpassed 1.2 million.

The government has invested more than 10 billion yuan during the past five years to improve the infrastructure of the fledging hi-tech park, which will eventually expand to the size of Hong Kong Island.

Located in the industrial and commercial corridor of Guangzhou-Shenzhen-Hong Kong, the park has already finished its road network and other infrastructure facilities.

Distinguishing the venue from other bustling industrial zones, the Songshan Lake, larger than West Lake in Hangzhou, is at the center of the picturesque park, and industrial, education, administrative and tourism zones have been planned while vast spaces are still undeveloped.

It is here in Songshan Lake Park that China's biggest patent-transfer to the US could occur soon - if the US stock market becomes more bullish.

Tan Wen, CEO of Key-Pharma Biomedical Inc, told China Daily that his company has tentatively achieved a deal with a US investor, who agreed to buy the patent of his team's new cure for asthma at a transfer fee of US$70 million.

"The US investor is longing to do clinical tests and produce the asthma medicine," said Tan. "Apart from transfer fee, the investor also agrees to deduct 12 percent from the total sale revenues once the medicine is on the market."

Countries such as China, Russia and the US have already approved Tan's application for patent protection for the new cure since last year. And China's drug regulator has already approved clinical trials with the new drug.

Tan said his US partner does not want to be named right now.

However, the global financial crisis has made Tan and his team hesitant to finalize the deal. "As the stock market is still slumping, we should keep alert (about) whether the US investor can attract investment or not," said Tan.

Tan said his company can wait until the business climate returns to normal. "The US law has allowed me 27-year patent protection," he said.