While China built its powerful export business -- increasing 17% a year over the last three decades -- on light industry and electronics assembly, that is fast changing. Rising labor costs, up 15% annually since 2005, plus an appreciating currency, are putting new pressures on China's cheap manufacturing model and driving textile, shoe, and apparel factories to close or relocate to Vietnam, Cambodia, or Bangladesh. China's share of the world's low-end exports has started to fall, and this reflects a shift by Chinese producers into sectors where margins are higher rather than a failure to compete, wrote UK-based Capital Economics in a Mar 28 note. The portion of China's exports made up by heavy industry, about two-thirds of which is machinery, has grown from 29% in 2001 to 38.7% last year, surpassing light industry and electronics, according to Beijing-based economics consultants GK Dragonomics.