Global Innovation is shifting towards China and Asia faster than anticipated
According to Dan Steinbock by looking at input indicators such as Research and Development (R&D), international R&D rivalry is no longer driven by the U.S., Europe or Japan, but Asia and particularly China.
Since the early 1990s, Chinese growth has been fueled by increasing R&D investment, which is aligned with the current 5-Year Plan 2011-15.
At the moment, China's R&D as a percentage of gross domestic product (GDP) is expected to increase to almost 2 percent of Chinese GDP in 2014 and is aimed at 2.2 percent by 2015. Today, China's innovation capabilities are closing up with advanced nations, such as the Netherlands and Belgium, and by mid-decade, the core euro economies, including France. What makes this world-historical performance even more spectacular is that it occurs in a colossal nation. As a result, the potential spillover effects are of an entirely different magnitude. According to the author the problem is not that emerging economies are catching up with advanced economies in global R&D investments but rather, the challenge is that the advanced economies, including America, invest too little on R&D while seeking cost efficiencies that are ultimately undermining U.S. innovative capabilities.
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