Cheaper labor and booming foreign investment are the key strengths of China's western business center of Chengdu, Nobel Prize-winning economist Robert Mundell said Thursday.

Addressing a symposium held on the sidelines of the 2013 Global Fortune Forum in Chengdu, Mundell said the inland economic hub should exploit its comparative strengths in the face of economic globalization.

Relatively cheap labor in Chengdu has attracted many domestic and foreign companies against the backdrop of rising labor and operational costs in the east.

"There will always be a low-end production comparative advantage here," Mundell said.

"As you move up the ladder to more high-tech and capital-intensive products, foreign investment will be a big part," he said, adding that foreign investment simultaneously brings capital, technology and market access.

"Growth has been spectacular in Chengdu, with a huge increase in foreign investment and exports," said Mundell. "Given the success that Chengdu has been having with foreign investment, I think that should play a big role."

More than 200 Fortune 500 companies have set up branches in Chengdu, which is often cited as "a benchmark city for investment in inland China."

The combination of a low-end production advantage and a booming high-tech sector has made Chengdu an attractive place for foreign investors and improved labor quality.

Mundell said Chengdu should consolidate its role as a manufacturing base and continue to foster investment in order to maintain its advantages.

Mundell also expressed confidence in China's economy.

"I think economic growth is going to remain high in China. I think growth in China will remain around 8 percent," Mundell said, adding that China must increase consumption and boost incomes in order to sustain its growth.

"I think that will also involve some movement of production from export industries to the service industry. China has a very small service industry compared to more advanced countries," he said.