Bluebook decodes China’s industrial technology innovation

The Chinese Academy of Science and Technology for Development (CASTED) recently released a bluebook on China’s scientific and technological progress over the past four decades, interpreting the evolution of the industrial technology innovation behind the country’s economic miracle.

China completed industrialization within several decades, a process that took developed countries several centuries. This was made possible by relying on the synergistic evolution of innovation in the labor-, capital- and technology-intensive industries, said Hu Zhijian, president of CASTED.

“Technological innovation based on labor-intensive industries is one of the important factors for leveraging China’s comparative advantage, a fact that has been recognized in the global industrial division of labor,” said Li Zhe, director of the Institute of Science and Technology Systems and Management at CASTED. The idea that China’s economic growth since reform and opening up depends entirely on the introduction of foreign technology is one-sided, Li stressed.

Li said that technological innovation based on labor-intensive industries can now be seen in the service sector. Relying on a huge consumer base and combining information and communication technology with labor, manufacturing capacity and a logistics network, some unique business models have been created, including e-commerce, online cab services, bike-sharing and online food delivery.

According to the bluebook, China has also witnessed rapid development in some capital- and technology-intensive industries, including shipbuilding, steel, electricity, machinery manufacturing and information electronics.

“That is thanks to integrated innovation,” Hu said. Some Chinese enterprises at the lower end of the industrial chain with certain R&D capabilities have optimized the allocation of innovative resources through product integration and technology integration, gaining a comprehensive competitive advantage in the process of product upgrading and market adjustment.

With China’s accession to the WTO, an increasing number of Chinese enterprises have begun to participate in the international industrial division of labor, some of which have promoted international technology flows through introducing technology and cooperation, rapidly improving technical levels and R&D capabilities through cooperating with universities and research institutes, and gradually finding new markets, said Chen Baoming, director of the Institute of Comprehensive Development at CASTED. For example, when constructing nuclear power, China imported the nuclear power technology from Electricity of France. China has created a technological innovation path of “digesting, absorbing and re-innovating on the basis of importation,” Chen said.

In terms of self-innovation, the bluebook shows that some Chinese firms in emerging industries are capable of applied basic research, operating at the forefront of industrial technology. Some enterprises have been maintaining a high level of R&D.

“Chinese enterprises can carry out innovation in a number of emerging or rapidly-changing technological paradigms, from being followers in the field of science and technology to running neck and neck,” Chen asserted.

China, as a large country in both its territory and population, has great differences in resources across various regions, leading to the formation of many development models, the bluebook says.

“Many kinds of high-tech industrial development zones and university research parks are widely spread out across China’s vast land, creating a good environment for the agglomeration of innovative resources,” said Xuan Zhaohui, deputy director of the Institute of Science and Technology Statistics and Analysis at CASTED.

For example, after 30 years of development, the number of national high-tech industrial zones in China has increased to 168. The 156 surveyed in 2017 had a gross product value of 9.52 trillion yuan, accounting for about 11.5 percent of the national GDP. Nearly 40 percent of China’s high-tech enterprises are located in these industrial zones, including Huawei, Alibaba, Xiaomi and other world-class hightech enterprises.

In addition, China attaches great importance to strengthening regional collaborative innovation and guiding benign competition among regions, Xuan said. The core cities represented by Beijing, Shanghai and Shenzhen have continued to evolve into diversified science and technology innovation centers. These leading cities are continuing to play their pivotal role in promoting resource integration and innovation synergy in the Beijing-Tianjin-Hebei region, the Yangtze River Delta, the Pearl River Delta and the Yangtze Economic Belt.

To date, China has become an important source of growth for global R&D. Having the world’s largest number of researchers, the country is the biggest producer of research papers, the biggest owner of patent applications and authorizations, and the biggest source of international students and STEM education graduates. Furthermore, China is the largest contributor of net intellectual property costs, and a large importer and exporter of high-tech products and knowledgeintensive services. China’s scientific and technological innovation has played an important role in the world’s inclusive development, according to the bluebook.

“The achievements of China’s scientific and technological progress are reflected not only in technological breakthroughs and cutting-edge advances, but also in the overall upgrading of the economic and social development of a developing country and its contribution to world economic growth,” Chen said.

Behind China’s tremendous scientific and technological progress over a short period of time, Chen said, there are deep economic, social and cultural factors, including the growing material and cultural needs of the people and their yearning for a better life, huge investment in science and technology, breakthroughs in scientific and technological institutional reform, the cultural tradition of valuing education, innovation and entrepreneurship culture, and the development of scientific and technological innovation activities by multinationals in China.

This article was edited and translated from Guangming Daily.