Remote RD in China: Drivers, Dynamics, and New Directions

Presentation Transcript

Remote R&D in China: Drivers, Dynamics, and New Directions Prepared for the Conference on "Worldwide R&D in China" Nanjing, PRC May 27-30, 2005 by Kathleen A. Walsh Consultant

Evolution of Foreign High-Tech R&D in China Drivers Dynamics Strategies (PRC and Foreign Investors') Implications

Official Figures Show a Steady Rise in Foreign R&D in China US DOC PRCG

Rise in China R&D Appears Tied to IT Industry Boom … and Bust Year 1 st R&D office reported Source: Stimson Center Study (2003)

There Have Been Several Distinct Stages of Foreign R&D in China Exploratory & Strategic Partnerships 1990 Expansion 1995 Consolidation 2000 Explosion ? 2005 Source: Stimson Center Study (2003)

Evolution of Foreign R&D in China Phase 1 ~ late 1980s–mid/late-1990s Exploratory and Strategic Partnerships Sino-Foreign Joint Ventures University Partnerships "Demonstrate R&D" Stokes' Matrix Deliberate Use N Y Bohr " s Quadrant Pasteur " s Quadrant Y Quest for Fundamental Understanding? ? Edison " s Quadrant N

Evolution of Foreign R&D in China Phase 2 ~ mid-to late 1990s Expansion Contract R&D/outsourcing – especially to colleges Training focuses included "Go West" accentuation and motivating forces Product improvement: restriction, updates, & framework and models mix Note: Took put amid IT Industry blast; pre-WTO

Evolution of Foreign R&D in China Phase 3 ~ late 1990s-mid 2000s Consolidation WFOEs – more incorporated offices More progressed R&D targets – moving toward "R" v "D" Closer relations with parent organization MNC worries over expanding costs Note: Took put amid IT Industry bust; post-WTO section

Evolution of Foreign R&D in China Phase 4 ~ 2003-2005 + Explosion (?) Rising quantities of R&D speculations picking up consideration of PRCG and others … prompts to enthusiasm for more insights being assembled PRC and MNCs looking for better approaches to endeavor business R&D in China Rising cross-local R&D joint effort, with China filling in as center Concerns develop over subsidizing for fundamental R&D

Implications for the Future China's present outside R&D venture direction is probably going to stay positive, however it's incline is subject to a few variables: Absence of a noteworthy political/financial disturbance Continued high monetary development rates Continued elevated amounts of FDI to permit more prominent concentrate on essential R&D subsidizing China's Western advancement system

Implications for the Future Phase 5 ? ~ 2005-2010 China accomplishes 2.0 % of R&D/GDP by 2010 "Go West" crusade resurges East Asian R&D consortium rises as focused compel Greater levels and propelled types of Chinese R&D seem abroad Increased accentuation on common military reconciliation causes concerns abroad China picks up acknowledgment for advancement; wins first Nobel Prize