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January 02, 2008

Research and Development in China

Christopher Thomas is Intel's deputy general manager for China and is based in Beijing and has written an article for Forbes that describe China's efforts and plans to develop innovation and inventions locally.

The Chinese government's goals are sweeping: to develop, influence or downright own the core intellectual property of the next generation of technologies that will power the global economy. To do this, the government has committed to doubling its spending on research and development so that it reaches 2.5% of China's gross domestic product by 2010, approaching $100 billion annually. China is also on track to have more research scientists and engineers than any other country by 2015.

China's efforts are sharply focused on 16 fundamental sectors. Among them are high-end chips, semiconductor manufacturing, next generational wireless communications, software, pharmaceuticals, large aircrafts and space systems including high-resolution Earth-observation systems. The government also intends to use China's very large domestic market as a carrot to encourage the international community to embrace and support inventions from Chinese companies.


My view and prediction of China's economy and currency appreciation indicate that in 2010 the Chinese economy will be at US$6.1 trillion. Therefore, the 2.5% of GDP spending on research and development target would be $152 billion (790 billion yuan) in 2010.

In 2006, the world's four largest spenders of R&D were the United States (US$343 billion), the EU (US$231 billion), Japan (US$130 billion), and China (US$115 billion). In terms of percentage of GDP, the order of these spenders for 2006 (no figure available for China) was Japan, United States, EU with approximate percentages of 3.2, 2.6, and 1.8 respectively. If China were to maintain the percentage of R&D spending from 2006 into 2010, then China's R&D spending would be US$255 billion and 4.2% of GDP.

China is well on its way to meeting the R&D target. In 2010, China would likely be the third largest R&D spender after the USA and the EU.

FURTHER READING
UK R&D scorecard site

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