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China Surpasses Japan in R&d as Powers Shift

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China is expected to become the world's second biggest spender on research and development (R&D) in 2011, overtaking Japan and trailing only the United States, according to a Battelle Memorial Institute report.

China is expected to spend $153.7 billion on R&D in 2011, compared to Japan's $144.1 billion, although both countries still trail the U.S., which is expected to increase its $395.8 billion 2010 R&D budget by 2.4 percent, according to the Battelle report. "China has sustained this kind of growth [in R&D spending] for a number of years and they're sticking to it regardless of what's going on in the global economic cycle," says Battelle's Martin Grueber. China is focusing its R&D efforts in certain fields, including alternative energy, life sciences, and advance materials.

Although U.S. companies are investing more in R&D now that the economy appears to be trending upwards, they are still below their historic R&D spending rate. "In a perfect world, the industry rate would be greater than five percent or even seven percent," Grueber says. Many large firms cut R&D spending in the first nine months of 2009, compared to the same time period in 2008, but increased spending in the first part of 2010.

From The Wall Street Journal
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Abstracts Copyright © 2010 Information Inc., Bethesda, Maryland, USA


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