China surpassing US in key innovation metrics

  • China has surpassed the US in one key measure of innovation and is making major strides in another.
  • China’s innovation in 2020 was 139% of its US equivalent, up from 78% in 2010. Additionally, based on another metric accounting for the comparative size of their economies and populations, China’s innovation output was 75% of US levels, up from 58% in 2010.
  • China is evolving from an imitator to an innovator, at a much larger scale, with greater geopolitical consequences.
  • China has already displayed great potential for global leadership in several key areas, including supercomputers, space exploration, Artificial Intelligence, Quantum Computing and High-Speed Rail.
  • Consequently, China’s innovation capabilities now threaten the global market share of firms from the US and allied nations in most high-value-added, advanced industries that are important to US prosperity and security. Thereby posing a threat to the hi-tech competitive edge the US has and hence the power balance in the ongoing US-China contest.
  • China accelerated its innovation push under President Xi Jinping, crystallised with the 2015 release of its “Made in China 2025” report. While a blueprint for national advancement is laudable, China’s protectionist policies, forced technology transfers, import barriers and state-owned companies were less so.
  • By 2020, China tallied more international patent families than the US and published more scientific articles. China also accounted for 39.6% of the 1.7 mn patents granted globally in 2021, followed by North America with 19.9% and Europe with 11.8%.

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