OECD had organized a Global Forum on “Innovating for Development” on July 2rd, 2014 in Paris. More than 400 guests from around 30 countries took part in this event.

 

No doubt to say that Innovating is the key-force for development in any countries in the world, and it is the life-line for sustainable development for China in the next 20 years to come.

 

On 09 June, 2014 in Beijing, Mr. Xi Jinping, the President of China made a very important speech to more than 700 members of Chinese top academics, saying as : “ Scientific and technological innovation serves as the strategic foundation for improving productivity and overall national strength, and it must be positioned as the core to China’s overall development. ” 

 These words will become the guideline for the innovation in the future development in economic and technological fields and surely bring great progress and great profits to the next 10 years of developments in China.

 

1. Contribution made by Chinese innovations thousand years before:

 China is a country with 5000 years of civilization and cultural cultivation.   China made greatest contributions to the world human-beings and modern industries by its own innovating, these innovations had made the whole world totally changed and brought the world economy a big step—forward in civilization process. These innovations made-by-China-only are:

•Explosives;
•Typography
(Printing / press machines) ;
•Compass;
•Paper-making technologies;

Although these Chinese innovations had been lasting for many (at least 2000) thousand years, but these basic technologies are still vital power and vigorous, and still have made contributions to modern society.

You have to know the fact that these innovations did not bring equality to China, because till today no one in the world has paid China the IPR (intellectual property rights) for these basic-innovations, although all modern technologies today are still growing up and benefiting from these ancient innovations of China.

 

2. Today’s contributions made by Chinese modern innovations :

a) Politically: China had innovated the theory of “one country two systems” which brought China into unique reforms since 1979. China combined the advantages of socialist system and capitalist system, let the planning economic mechanism with market economic mechanism to play their best performance which has been proved as a successful and incomparable outcome that made China as the second largest economic entity in the world.

 

b) Financially: The essential innovating effort by China is the reform taken place in financial sector.

 In 1980’s, Chinese banks were regarded as the worst bank and most inefficient institutions in the world, as remembered at that time the Chinese banks were at ranking after 200th among so-called 300 best banks-list. But now the top 4 Chinese banks became the first group of best banks in the world.
                                                                      
The total value of Chinese banks now are :

The innovation theory in financial industrial is the “Great Finance” worked out by Prof. Chen Yulu, President of Renmin University of China. This theory was announced 10 years before by the Professor ------- From Renmin University of China.

The core nature of “Great Finance” integrated macro economy and micro economy; people’s economics and enterprises economics; estate financing and service financing.

The key-aim of the theory is asking the financing industry to serve the people, to serve the national economy, to serve the development of the country, not to serve the profit, neither to serve the capital only.

 

“Great Finance” will be surely acting as the most important innovating guide-line to facilitate the further process of the development of the country.

c) Economically: China’s greatest innovation in economic area has been playing great role in the process of development. Especially the Innovation of concept to set up “ Industrial Zone” or “ Special Zone “ in all provinces to attract investments and innovators from all over the world. The first Industrial Park Zone was established with Singapore that had set up positive example to other areas of the country.

In 2013, China set up FTZ (Free Trade Zone) in Shanghai,   this is the latest innovation in developing country’s economic dynamics and providing new experiences how to deal new challenges China is facing to the stagnation of world economy.  

   
d) Technically: China has developed its own technologies in developing the high-speed rail-way industries. In the past 10 years, China has built up 20,000 km high-speed rail-way that connected all major cities, and makes it possible that within 5 hours you can reach all main cities around Beijing. From Beijing to Shanghai, it takes only 5 hours, and 10 years before you need 16 hours by fast-train for the same distances.

 

The technologies related to the electrical systems, rail manufacturing, control systems etc are innovations by China. Thus the high-speed rail way technology has won great reputation from the world community. This innovation has brought China wealth more than 10 trillion USD in the past years.

 

No questions about the innovations China has made in space industry, satellite and moon exploring, solar energy, biochemical and Chinese pharmacal industries etc. That contributes great support to world economic recovery.  
 
3. To promote scientific innovation:

According to the news report by Le Figaro in Feb, 2009, that China had made marvelous progress in its scientific research and innovation in top-field of technology, especially in the Nami technical R&D fields. And the numbers of relevant essays overtook the first position replacing USA, as well as in the field of chemical and other fields. In 2008, China became the second largest country in scientifical R&D activities, replacing Japan and EU countries.

 

As French Professor had expressed that China would become the strongest country in few years in scientific research and would overtake the position of USA and EU, Japan, would have more influential power in the world.

 

More efforts made by Chinese Universities and enterprises to invest more to boost the innovating.

 

For example, Wuhan University, located at central China this university had allocated more than USD 33,500 to set up the innovative projects and opened key national labs to inspire the graduates, beside it had invested USD 3,000.000 to build up the engineering practicing innovation centre. From 2006 to 2013, the number of student renovation projects reached 4549 with approved funding of USD 1.3 million. This is only one small example that a normal Chinese university has achieved its efforts to initiate the innovations ability.

 

Zhangjiagang, a county level in Jiangsu Province is rolling out an ambitious plan to become a major technology hub, is trying to attract skilled domestic and overseas talents to maintain its quick economic growth. In 2013, local authority invested USD 27 million in project to lure hundreds of top professional. This city received a UN Habitat Scroll of Honor Award in 2008.

Every year there are about 3000 graduates from local university, and 90% of them are choosing to stay in the city for new career.

 

4. Foreign-funded Institutions :

In China we have many foreign-funded R&D institutions making great efforts to provide innovations in the fields related to their business, like Pepsi.Co. Asia, after committing 2 billion dollars to its China operation in the past years, it currently boasts 22 unique billion-dollar brands, and R&D built-up helped Pepsi to get more market share in China, helped it to have double-digit growth in the year of 2013.

Conclusion: Taking the EU as a whole, China ranked 7th in the Innovation Union Scoreboard in 2013. South Korea and USD obtained the highest scores. China’s score is just 40% of what South Korea and USA, 50% of what Japan scored.

 

To raise efficiency in innovation is the key challenge for new reforms specially in the innovation assessment system.

 

Innovation is not only a question of technology, but also rooted in the education, R&D, finance, business, taxation, banking and industrial transformations etc.

 

According to OECD research that R&D accounted for 1.98 % of China’ GDP and 1.96% by EU member countries in 2012. There are big rooms for China further strengthens its efforts to boost innovations.

 

Li Keqiang, Premier of China made a speech during the annual meeting of the Global Research Council held in Beijing on May 27, 2014. “China’s development is an open one. We need innovative individuals and creative enterprises in their tens of millions …… and ensure that all innovators are duly honored and rewarded, thus galvanizing greater incentives for innovation”.
 
We can see the facts that the total R&D investments in 2012, reached USD 1.4 trillion, increased 18.5% compared to 2011. The strengthen of R&D investment was 1.98%, almost similar to the level as Japan in 1970s and as South Korea in 1990s. The problem in R&D in China relies at that the investment focused mainly on application and test phases, but less focused on fundamental creation.

 

The proportions of three main elements are shown as:

 The fundamental research : 4.8 %
 The application research: 11.3 %
 The Test & Development : 83.9%

 

All figures are in 2012.

 

The factor of innovation will play a decisive role in the development of economy, as China is the second largest economic entity, China must do its utmost to promote the innovation in all fields.

 

Innovation and Creation are both same important to all countries in the world. As a matter of fact, that the innovation may be easier than creation, because creation is something more sensitive, keen practical and difficult than the innovation. Only through and by creation, all innovations could be realized and brought into market and real economy that could bring practical commercial and market value - profits to the innovators and enterprises, owners of the innovations.（欢迎关注人大重阳新浪微博：@人大重阳，微信公众号：rdcy2013)