With an annual R&D injection from public and private business sources of 1.5 % of GDP over the last decade, the results have begun to pay off
Long saddled with the stigma of being the country that has perfected the art of copying, China now has its sights set on joining the ranks of the globe’s most innovative nations by 2020. Five years ago, the Chinese government outlined an ambitious plan to achieve this goal: push R&D spending up to 2.5% of GDP, boost China’s total patents and research volume into the ranks of the global Top 5, and ensure that Chinese science and technology contribute to more than 60% of the nation’s economic development.
With an annual R&D injection from public and private business sources of 1.5 % of GDP over the last decade, the results have begun to pay off.
Having already surpassed Japan as the world’s second leading producer of research publications (one major source of the fuel that drives innovation), China is moving up quickly, although still a distant second from the US which had 28% of global research publications in 2008. Meanwhile Chinese companies such as BYD, in the field of alternative energy, Li Ning in sportswear, Huawei in IT, and e-commerce powerhouses such as Taobao and 360 Buy have, arguably, established themselves internationally for competing through innovation. As these companies illustrate, innovation exists in many forms in China (as it does in the rest of the world): from BYD’s radical and disruptive creations – which turned the auto industry on its head – to the more common incremental improvements made in terms of cost, products, processes or business models.
Co-Director of CEIBS Centre on China Innovation, Professor of International Business Bruce McKern
[Reprinted with permission from The China Europe International Business School.]