By Richard McGregor in Beijing

Tuesday, August 28, 2007



China's drive to become a global force in science and technology faces serious obstacles, according to the Organisation for Economic Co-operation and Development. It blames state dominance of research and development and the economy, and a shortage of talented scientists and managers.



In a report jointly researched with Chinese institutions, the Paris-based OECD said "a high-technology myopia pervades current policy objectives and thinking on innovation". As a result,more broadly based innovation in services and other sectors of the economy had been neglected.



The report said China had made "impressive strides" in building a science and technology system since launching economic reforms in the late 1970s and that the government's role had "changed remarkably".





R&D spending had increased annually by 19 per cent since 1995, and for the past five years China had ranked second, behind the US and ahead of Japan, in its number of researchers.



Its R&D to gross domestic product ratio had doubled over a decade to 1.34 per cent in 2005, at a time when the economy was expanding by about 10 per cent a year.



China's higher investment in research had been reflected in a rise in internationally cited scientific publications, in which it ranked fifth in 2005. In nanotechnology China had almost as many published works as the US, the OECD said.



China had meanwhile streamlined government research institutions in the same way it had restructured state-owned enterprises, where it had purged tens of thousands of employees. The Chinese Academy of Sciences had seen its 120 institutes cut to 89.



But the OECD said much of the new R&D spending had "focused on the high-technology sector, updating equipment and facilities, and experimental research for new products rather than on basic research". More investment was needed in "sectors such as services, energy and environmental technology".



R&D programmes continued to reflect the dominance of the state, with design "characterised by a top-down, 'picking the winner' approach", the report said. "The government decides on programmes and sets priorities, with little involvement of other stakeholders."



Despite producing tens of thousands of engineering graduates every year, a statistic often cited in the west to show growing technological prowess, the OECD said China was facing a shortage of scientists. The proportion of graduates emerging with science and engineering degrees had been falling since 2000.
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