Patent Powerhouse
Updated: 7 10,2020 Source:China Daily Global

Leapfrog development of China's technological innovation has been realized by the implementation of a clear strategy

Today, China's technological innovations mean it is the largest contributor of international patents to the world, making it the leading promoter of international scientific and technological progress and economic development.

On April 7, the World Intellectual Property Organization (WIPO) released data showing that in 2019 China surpassed the United States to become the country with the largest number of international patent applications under the Patent Cooperation Treaty (PCT) framework. China overtook the Republic of Korea in 2010, Germany in 2013 and Japan in 2017.

China filed a total of 276 patent applications in 1999, and the number soared to 58,990 in 2019, a 200-fold increase in 20 years.

This raises a question: How has China achieved its leading position in PCT technology innovation, surpassing even the US?

First of all, several national strategy plans have empowered market players. In 2006, China formulated the Outline of the National Medium-and Long-Term Science and Technology Development Plan (2006-20), which proposed the goal of entering the top five in the world in terms of the annual number of patents granted to nationals by 2020. In 2008, the National Intellectual Property Strategy Outline set the protection of intellectual property rights as a national strategic objective. Subsequently, various ministries, provinces and industries have put forward a series of specific implementation plans in terms of improving the market system and government policies. In 2010, the National Patent Development Strategy (2011-20) set out the quantitative goal that the number of PCT applications per million people should be doubled by 2015 and quadrupled by 2020. In 2015, the In-depth Implementation of the National Intellectual Property Strategy Action Plan (2014-20) called for the improvement of patent quality. The evaluation criteria include the average duration of domestic invention patents, the volume of contract deals in domestic technical markets, and the annual amounts of intellectual property pledge financing, export revenue from patent loyalties and licensing fees, among other aspects.

As a result, China has become the world's largest patent application and licensing country. In 2019, the number of patent applications at home and abroad was 4.38 million, 2.592 million patent rights were granted, and 61,000 PCT patent applications were accepted. By the end of 2019, there were 9.722 million effective patents, among which 1.862 million were domestic invention patents. In addition, the number of invention patents per 10,000 of the population was 13.3, exceeding the target of 12.5 proposed in the 13th Five-Year Plan (2016-20).

Furthermore, the patent-intensive industries are among the largest emerging industries in China. In 2018, the added value of patent-intensive industries nationwide was 10.71 trillion yuan ($1.53 trillion), accounting for 11.6 percent of China's gross domestic product. This sector includes seven categories: new equipment manufacturing (of which the value added accounted for 30.7 percent of the total patent-intensive industries); manufacturing for information and communication technology (20.1 percent); the service industry for information and communication technology (18.2 percent); new materials manufacturing (13.2 percent); the pharmaceutical and medical industries (8.8 percent); R&D, design and technical service industries (6.7 percent); and the environmental protection industry (2.3 percent).

The implementation of the national innovation strategies has facilitated the leapfrog development of China's technological innovation and promoted the transformation of Chinese innovation from the expansion of scale to quality improvement.

Independence in technology is the key to sustained and even accelerated development of Chinese innovation. In the wake of the international financial crisis, international trade and technology protectionism have become increasingly prevalent. The growth rates of foreign direct investment, imports of foreign-invested enterprises, imports of capital goods, and imports of high-tech products in our country have all slowed down significantly, leading to a decline in foreign technology transfer. Through the national strategic programs, China has shifted the channel of technology learning from foreign expertises to domestic talents, which has further promoted the vigorous development of China's independent technological innovation. China's R&D expenditure has accelerated to catch up with the US, increasing from 46 percent of the US expenditure in 2009 to 90 percent in 2017. As stated in the Outline of the National Medium-and Long-Term Education Reform and Development Plan (2010-20) published in 2010, the core task of higher education development is the improvement of quality, focusing on the training of high-quality talents. The number of postgraduate students nationwide increased from 1.54 million in 2010 to 2.86 million in 2019. The number of postgraduate students receiving degrees nationwide increased from 363,600 in 2010 to 640,000 in 2019, and the number of full-time R&D personnel rose from 2.55 million to more than 4 million within the same time frame. In addition, the number of Chinese students returning to China has risen sharply, from 134,800 in 2010 to 519,400 in 2018. The combination of this sustained large-scale R&D investment and the scientific and technological talent team has created a solid R&D capital and human capital foundation for China's independent leapfrog development.

In short, technological progress is the foundation of China's continuous innovation, and the implementation of the national innovation strategies provides important support for China to build a global powerhouse for innovation. In doing so, China will make its contribution to continued technological progress for the whole world.