Peter MacKinnon

China's S&T strategy: A 'Great Leap' forward

By Peter K. MacKinnon

China has experienced broad and sustained economic growth for a number of years. The mechanisms by which that growth has been sustained are changing and Chinese leadership is driving that change. In making a transition from sustained economic growth to one of sustainable economic growth China sees science and technology (S&T) as the key drivers to achieve this transition within the context of innovation. This includes ‘invention' innovation in the classical sense; as well as ‘integrated innovation' or the fusing of existing technologies in new ways, and ‘re-innovation', aimed at assimilating and improving technologies from abroad.

By the end of 2007 China ranked as the 4th largest economy in the world, up significantly from its doldrums of the previous century. By mid-2010 China became the 2nd largest economy and it is anticipated to surpass the US sometime between 2020 and 2030. The Chinese economy is now more than 28 times its size than 30 years ago when the economy was smaller than Canada's. Today it is nearly four times Canadian GDP.

Until 2006, the common goal in all preceding S&T reforms, strategies, and programs — going back to nuclear weapons development in the 1950s-1960s — had been an attempt to catch up to the West by whatever means. Since 2006, China set a new course to primarily pursue S&T strategies based on indigenous research and development. Concurrently, China is moving toward strengthening its basic R&D capabilities, enhancing its S&T talent pool, and revitalizing its intellectual property (IP) granting processes and enforcement procedures.

For at least a decade Chinese leadership has recognized that fundamental change is required within policy, programs and resources in order to foster an innovation-oriented society. Principal among these is a need to re-orient the Chinese economy away from a high dependency on exports and the use of foreign technologies and related IP to one of greater consumption of domestically produced products, technologies and processes.

Chinese-developed S&T are expected to play a much more significant role in creating commercially viable outputs. A major impact of this is the strategic move away from the dominant policy of the past, that being of offering foreign corporations market access for technology licensing and joint manufacturing rights in China. The longer-term ramifications of this may well change the playing field for foreign company operations in China by increasing the degree of competition in favour of domestic firms as well as witnessing the emergence of new global-scale technology-intensive Chinese firms such a Huawei — a global telecommunications solutions provider with revenues on par with Nortel Networks Corp in its heyday.

According to the OECD, the R&D intensity of China's economy has increased significantly in the past 15 years, from 0.6% of GDP in 1995 to 1.43% in 2006. Until 2006, China's spending on R&D remained dominantly focused on experimental development; only 5.2% of all R&D in 2006 was aimed at basic research, compared to 10-20% in OECD countries. Furthermore, only 11% of patents by Chinese firms in 2006 were considered inventive, compared with 74% of patents by foreign firms registering in China.

In recent years, it has become clear to China's leaders that the real value-add in the market for advanced technologically-based products and processes vests with those who own the IP and influence global technical standards. Consequently, in January 2006 China initiated a 15-year Medium to Long-Term Plan for the Development of Science and Technology (MLP) which calls for China to become an innovation-oriented society by 2020 and a world leader in S&T by 2050. By 2020, China plans to be investing 2.5% of its GDP in R&D. The MLP also aims for China to become one of the top five countries in the number of invention patents granted to its citizens.

MLP views S&T needs in terms of 11 key areas within the economy (e.g., agriculture, population and health, and energy). Based on these targeted application areas, the MLP prescribes programs and actions in eight key 'frontier' technologies (e.g., advanced manufacturing, new materials, and biotechnology). Given the interdisciplinary nature of many scientific and technical pursuits, the MLP features four major science-based megaprojects (e.g., development and reproductive biology, nanotechnology, protein science, and quantum research). It also includes 13 engineering megaprojects (e.g., drug innovation and development, manned aerospace and Moon exploration, and water pollution control and treatment).

In March 2011, Beijing celebrated the findings and accomplishments arising from major S&T programs and projects carried out during the first five years of the MLP. This celebration was a demonstrable illustration of the significant progress on many fronts China has made over this period and included some 600 projects such as Tianhe-1, the world's fastest high performance computer; a prototype lunar lander and rover; new advanced nuclear reactor designs; 10,000m deep well-drilling equipment, and much more. China is now focused on creating domestic advances in S&T while pushing the technological frontier at the same time.

China's revitalized S&T strategy is now attuned with and supporting the economic, social and geopolitical rise of the country. It has taken years to achieve this ‘leap forward' in thinking and planning. Few countries can afford to take this position on such a broad front, including boosting the number of patents to one a million a year by 2015.

This is more than 50% larger in volume that the busiest patent centre in the world today — the US Patent Office. It is anticipated that the domestic contributions to economic growth from technological developments will be more than 60% and depend- ency on foreign technologies will be limited to less than 30% by 2020. These are clear metrics that in the relative short-term will show if China can play on the world stage as an S&T superpower. Achieving global dominance in S&T by 2050 remains a target, the boldest target China has set for itself in terms of S&T expectations.

(This article is an update on an Opinion Leader contributed to these pages in August 2007 (R$, August 13/07). A longer version of this article can be found on the R$ website).

Peter MacKinnon is executive director WiSense Project at the University of Ottawa's School of Information Technology and Engineering He has more than 30 years of experience in China in the areas of S&T and research for more than 30 years.