Recognising that science and technology were considered by the Chinese government as a key factor of production along with labour and capital, Yao Shujie argued in a recent article (*) that China’s strategy was to “walk on two legs”, the first being to build up domestic research and innovative capacity by investing in research institutes, universities and large and medium-sized enterprises, and the second being to build technological capacity through its open door policy. 

The government relied increasingly on its higher education sector to conduct scientific research, and the growing numbers of students educated to high standards at home and abroad had also had an impact. By 2003, the number of students enrolled in HEIs reached a record level of 3.8m, rising from 600,000 in 1990 and just under 300,000 in 1980. China had more than quadrupled its expenditure on research over 10 years in real terms and the number of research scientists increased by more than one-third.

“Apart from buying patents and importing technologies from abroad, China has paid serious attention to basic research at home and is ambitious to compete with the world’s most innovative countries,” he wrote. Large investments had been made in the Chinese Academy of Sciences (CAS), to attract as many top scientists as possible from home and abroad.

This mindset was further reflected by the growing number of papers published by Chinese scholars and cited in key international citation indexes – up almost three-fold in the key indices during 1995-2002 – and by the rising number of patents granted to domestic Chinese researchers.

A researcher displaying a wafer in the lab of Shanghai Micro Semiconductor Company

More than 99 per cent of patents granted to utility models, and about 90 per cent of patents granted to design were given to domestic researchers, leaving only invention patents as being mainly granted to foreign researchers.

China had also focused efforts on importing technologies, with an estimated US$70bn spent on imports of advanced technology between 2001 and 2005.

China would also learn by imitation and importation of advanced technologies, which was normal during the early stages of economic development when the country was focused on low- to medium-technology sectors, he wrote. “The necessary conditions in this stage of development are the gradual accumulation of human capital through education and training, applied research to digest and imitate what has been made available from the advanced economies, and the ability to buy foreign technology through an export-push strategy.”

But this pattern of growth might not be sustainable in the long term, particularly where the ambition was to become an economic superpower. Economic growth in China had relied on labour-intensive industries and flooding the world market with cheap products, but of only low- to medium-level technology. China had failed to create a large number of big businesses that could compete with the world’s leading multinationals, he wrote. 

China needed to develop its own research and innovation capacity and use S&T to support its long-term economic growth, as outlined in the recently-published ‘medium- to long-term S&T development plan’, from the State Council.

Professor Yao Shujie is professor of economics and Chinese sustainable development and head of the School of Contemporary Chinese Studies at the University of Nottingham. *Professor Yao’s paper, titled Building a Strong Nation: How does China perform in Science and Technology, was first published by Asia Europe Journal, Vol. 4(2), 2006.