The Chinese economy is quickly transforming from a low-cost manufacturing economy to a higher value innovation led economy.
Metrics on China’s innovation show the increase of this figure of merit is outstanding, from 0.5 % in 1995 to 2% in 2014. The objective is to reach 2.5% in 2020, thus overtaking the average investments of the European Union.
Given the rapid growth of China’s economy, numbers in absolute terms are even more impressive. In 2014, R&D investments in China are expected to total $270 billion. Following the recent trend, this number may overtake that of the USA as early as 2023.
The leading patent owners in China are those such as ZTE and Huawei both telecommunication companies as well as the car maker Chery. Huawei, Lenovo and Haier are one of the only Chinese firms that have ventured abroad however this is steadily growing with the number of Chinese investments going abroad now equaling the flow of investments going into China.
Chinese firms contribute a rapidly growing share of innovations that are private and entrepreneurial. They are very active in the ICT – information and communication technologies and electronic games. The weight of the state-owned enterprises (SOE) is decreasing, both as a factor of GDP and in the production of innovative offerings.
A strong entrepreneurial spirit, a relentless market-orientation, an agile and rapid implementation in a vibrant economy demanding outstanding quality to price ratios: these are the basic descriptors of Chinese society.
China’s strong focus on being a knowledge economy primarily focused on ICT is something well recognized, being described as “a strong entrepreneurial spirit, a relentless market-orientation, an agile and rapid implementation in a vibrant economy demanding outstanding quality price ratios.” Chinese enterprises will contribute to making the country a global source for innovation, especially in the ICT sector.