Innovation a hallmark of China from time immemorial3

Friday, 4 December 2009 | Filed under Innovation

To see the future where China is concerned, one has to only look at its history. Innovative leaders since thousands of years ago, China gave the world such revolutionary inventions as the compass, gunpowder, printing and paper-making.

These inventions formed the basis for further progress and innovation for the rest of the world, and they should rightly serve to remind us of what the Chinese are capable of doing.

Certainly, the answers are there in the annals of history: the fact that it’s one of the world’s oldest civilizations itself says it all. Creativity and innovation were already hallmarks of the kingdom long before the terms became buzzwords of the 21st century. This is evident in every Chinese icon and institution – from the Great Wall of China to the Forbidden City to the Terracotta Warriors of the Shaanxi province.

As it is, China’s rise as a global economic power has caused much excitement in recent times. The Chinese government has set targets, aiming to be an innovation-oriented economy by 2020 and a world’s leading science power by 2050.

In the meantime, the western world is eyeing the whole transformation with interest, if not trepidation – for it remains to be seen the implications of a China that is superior to all others on earth. Time Magazine, in reflecting the sentiments of the American public, front paged “5 things the US can learn from China” in its Nov 25 issue. “While the US remains mired in an economic funk, the Asian giant drives ceaselessly forward,” the article by Bill Powell reads.

And certainly, enterprises – whether western or eastern – wanting to remain in business and ensure their continued relevance are already trying to understand the China story, seeking answers to such questions as is China able to innovate successfully? And doesn’t China need to look into areas such as implementation of intellectual property laws first to be truly effective as an innovation-led country?

Inventions for the world

These are irrelevant questions, if you ask me, for I happen to believe we need not look farther than what’s before our eyes, and I am not referring to the rapid speed at which bridges, roads and high-speed rail networks are put into place in China today – reflecting the massiveness of the infrastructure build-out of the country – or how a small town like Dongtan can be turned into a bustling city within the short span of five years. Or that Shanghai’s popular skyline, including the Jin Mao Tower and the purple rocket-shaped Pearl TV Tower, was a rice paddy just two decades ago.

History provides enough evidence about China’s potential as a leader in innovation. The country has for thousands of years contributed much to science and technology, and in areas such as traditional medicine. The Tang dynasty (AD 618-906) was particularly a period of great innovation. Chinese literature, architecture and the various forms of art thrived during this period. The technique of printing with carved wooden blocks, for instance, appeared and evolved from here, as did the process of paper-making.

But other eras were also notable in terms of great inventions. The world’s first compass was made in the ancient kingdom during the Qin dynasty (221-206 BC) while silk is believed to have emerged in China at least 5,500 years ago. The cultivation of silkworm can be traced back to the third century BC.

China is also a pioneer in world navigation. As early as the Qin and Han dynasties (221-220 BC), Chinese people already knew the techniques of identifying a ship’s sailing direction by watching the northern star.

There’s also the contribution China has made towards art. The beauty of Chinese antiquities has resulted in artifacts and furniture from China being among the most sought-after in the world. Private collectors value the craftsmanship reflected in such works and they would be keen to own a piece of China’s past whether it be a sculpture, painting, porcelain or carving. (An estimated 400,000 tombs were reportedly raided in China in the past quarter century, and of course, China has since actively gone on to retrieve or document treasures it says were looted from the country, believing 1.5 million relics were now scattered over 2,000 museums in 47 countries).

Investing in education and R&D

So, yes, while some in the west are slowly waking up to the possibilities of a China as an innovation leader, the signs have always been crystal clear to the rest of us: China was a great world innovator before, and although it has fallen short by 21st century interpretations – in such high-tech areas as IT – it won’t be long before it dominates again as creator and innovator, especially now that the people of China are focused on the task.

As it is, China now leads the world in the number of people engaged in science and technology. The country is ranked fifth globally in terms of number of scientific articles published. Many indicators and statistics, such as number of science and engineering papers that Chinese researchers publish in international journals, the amount of investments made in R&D, and the number of patents, indicate that China’s science and technology capacities have been developing quickly.

The Economist Intelligent Unit Survey 2009 shows how China’s university graduates with degrees in science and technology represent 40% of the total, almost twice the OECD average and far above the 15% recorded in the US. This reflects how the
country is making a concerted effort to build a more innovative economy, investing heavily in education and R&D.

Much of China’s FDI will continue to target innovation-intensive sectors, and further working in the country’s favour is the fact that foreign companies see the wisdom is opening research centres in the country. Engineering-level investments will continue to pour in because many technologists believe China is where new industries such as green-tech will take shape.

The foundation for these has been laid; the ideas have taken root. Environmental campaigners have said China could be a green technology manufacturing hub in the near future, and such developments are moving at a breakneck speed. The country is expected to become the world’s biggest producer of wind energy by 2013, and 13 of its biggest cities will have all-electric bus fleets within five years.

Pioneering green-tech

All these efforts are another demonstration of how China can make a huge leap forward when it chooses to. So it’s likely that the day will come when China the environment-polluter would be a green-tech pioneer. And, from the looks of things, that’s only one area among many China would revolutionise. Outside the mainland, its people are making inroads into other parts of the emerging world where creativity and innovation is concerned. In Africa, the Chinese government is taking a growing role in infrastructure investment, among others. In the last decade, trade between the two countries has mushroomed to US$106 billion and China has decided to increase its China-Africa Development Fund by US$2 billion.

Fast moving away from the “world factory” tag – a short-term strategy – China is clearly focusing on improving quality and productivity. Its innovation performance as mentioned earlier is testimony to this. It reflects China’s success in absorbing both new technologies and modern business practices.

At this rate, the country will soon out pace the rest of the world in producing goods and services of high quality. The Japan External Trade Organisation, in acknowledging how China is developing rapidly from producing low-quality products to those of high-grade and high-tech, says Japanese companies are meeting the challenge by shifting some production of middle-range products to China, while at the same time focusing on upgrading their own high-value products and services.

Other countries are likewise keen not to miss the bandwagon. In 2008, the total number of foreign enterprises accounted for around 3% of businesses nationwide. These foreign enterprises’ industrial output value accounted for 29.7% of the national total, providing employment for 45 million people. The World Investment Prospects Survey 2009-2011, issued by the United Nations Conference on Trade and Development reveals that factors such as steady economic growth, great domestic market size, low labor costs and the opening-up of markets will enable China to remain the most attractive destination country of foreign investment.

The American Chamber of Commerce in China, in the meantime, has announced that among the US enterprises surveyed, over 80% are optimistic about the prospect for their operations in China and 73% are planning to expand their investments in China. Siemens, for instance, invested an additional US$190 million in its regional headquarters located in China last January, further boosting the production capacity and operational activities in the field of alternative energy.

Reflecting globalisation and the growing influence of emerging markets, the investing world is moving east. Countries are drawn to the pulling power of China, motivated by the level playing field factor, and other 21st century realities such as enhanced connectivity.

Certainly, China has the vision, the energy, the motivation and the market to realise its 21st century goal. In the China story, history – that of a world innovator – will repeat itself. If it hasn’t already begun to do so.