| Transnational Corporation Will Increase R&D Investment in China |
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| Tuesday,March 29,2005 Posted: 16:59 BJT(0859 GMT) |
Tuesday,March 29,2005 Posted: 08:15 BJT(0015 GMT)
Latest investigation and research by MOFCOM indicates that 61% of transnational corporations will continue to Increase R&D investment in China.
Investigation and research group on industry investment trends of Chinese Academy of International Trade and Economic Cooperation of MOFCOM releases "2005-2007 investigation and research report on industry investment trends by transnational corporation in China". The relevant person in charge of the group said as the rapid development of information technology, to set up global R&D network, their investment in R&D will be changed from strategic technology alliance to merger with them in three years. Through merger, transnational corporations can directly seize the control of Chinese original R&D institute and utilize it after transformation.
Currently R&D investment by transnational corporation in China is "strategic technology alliance", namely, technology and fund are highly concentrated, most transnational corporations make their own countries the center of R&D network, that is to say, although R&D function of central laboratory of transnational corporations is partly spread out, their central part still keeps in their own countries.
The person in charge analyses, "R&D of transnational corporations still focus on applied research, product development and localization, and foundation research is relatively fewer. Viewing from demand, main purpose of transnational corporations to do overseas R&D investment is to support local production and sale, and applied R&D institute can meet these demands of the transnational corporations."
Viewing from supply, basic research needs a great deal research facilities and senior researchers, and can be supported by government policy; therefore, they do not easily move R&D to overseas. Research is significant for future development of enterprises, and it should be kept as a secret, so transnational corporations always set the institutes near their headquarters to govern and control.
The report showed that in the next three years, transnational corporations prefer full foreign investment operation both in production and R&D. According to statistics, in R&D investment, 46% enterprises prefer to set up independent R&D center, 33% enterprises prefer to introduce more advanced technology to China to R&D, and 33% enterprises plan to increase researchers in China on the origin basis. In production investment, 57% enterprises prefer to set up a full foreign investment R&D center.
The person in charge believes that it is more benefit for transnational corporations to choose full foreign investment to self govern and intellectual property protection. They can adjust production and research direction according to market situation and general corporation strategy.
Through investigating for half a year from June to November 2004, the group finished the report in the end of February 2005, the investigation targets on the top 1000 enterprises in Business Week, covering enterprises of Europe, US, Japan, Korea, Taiwan province and Hong Kong, engaging in the field of IT, electronics, auto, chemistry and biology pharmacy.
(Source: Network Center of MOFCOM)
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