XI CALLS FOR INNOVATION IN PRODUCT RESEARCH
More must be done to turn nation’s many patents into marketable goods, the president says, as he names two provinces to lead the charge
President Xi Jinping has called for a more concerted effort to transform scientific research into marketable products – one major bottleneck in the advancement of China’s technological capabilities – and singled out two of the country’s provinces as places which should be leading the charge for tech innovation and national growth.
He made the remarks in a discussion with delegates during this year’s parliamentary gatherings, known as the “two sessions”, last week. The details were only made public by Xinhua, the state news agency, on Monday evening.
One delegate told Xi the main challenge China must contend with in its tech development is a low patent conversion rate, despite a high number of claims filed each year. The president replied the situation was improving, but the country must still strengthen bonds between research centres and enterprises and improve incentive mechanisms.
China’s conversion rate for scientific and technological achievements in 2021 was a mere 6 per cent, and its invention patent industrialisation rate 36.7 per cent according to a report by Nanjing University’s Yangtze Industrial Economic Institute published last year. In comparison, corresponding figures from the US were 50 per cent and nearly 80 per cent respectively.
Xi’s exhortation for a more committed pursuit of tech evolution, part of an overall drive for new growth engines deemed “new quality productive forces”, came with a warning not to pursue breakthroughs at the expense of wasted investment or the abandonment of traditional industries.
He also urged policy continuity and real action to counter lingering scepticism over China’s economic health.
Beijing has put “new quality productive forces”, first mentioned by Xi in September, at the centre of its economic agenda. The world’s second-largest economy is attempting to reorient economic growth patterns, address overcapacity concerns and counter US tech curbs, while deflating persistent scepticism of its economic prospects.
Xi named specific regions to take the lead in these efforts during a March 5 meeting with delegates from Jiangsu province.
“I always encourage major provinces like Guangdong and Jiangsu to assume key roles at Politburo meetings. How can national modernisation be achieved if they don’t carry out their responsibilities? They are important and irreplaceable,” he said.
China has laid out an ambitious gross domestic product (GDP) growth target of around 5 per cent in 2024, despite a slump in the property market, high debt loads for local governments and weakened confidence among private and foreign investors.
The combined GDP of Guangdong and Jiangsu makes up more than 20 per cent of the national total, and their shares of China’s exports and foreign investment are also among the highest of any region. Both provinces have set annual growth targets of 5 per cent, mirroring the central government.
Xi also used the sessions to take a swipe at critics, citing a poem by late leader Mao Zedong to say China needs long-term vision to resolve issues.
“People should not just criticise or point fingers, but take real action and solve one issue at a time,” he said at a panel with delegates representing the cause of environmental protection.
“As long as we’re convinced that we are moving forward, we must keep our mettle and carry on,” he was quoted by Xinhua as saying.
Xi, firmly at the helm in China’s economic policymaking, also asked about weak links in the country’s photovoltaic industry, providing another opportunity to promote self-reliance in tech.
“Facing a new scientific revolution and industrial transformation, we must promote innovation to nurture emerging industries and build future industries with foresight,” he said.
“More enterprises conduct R&D themselves and transform the outcomes into new products. Research institutions and enterprises are forming synergies. Incentives and supporting policies must be ramped up to hasten the process.”
Specifically, Xi pushed for more incentives to promote the application of scientific research and pressed for “obstacles and bottlenecks” to be broken.
“China’s industrial development is all about self-reliance and catching up from behind. We started from scratch and we now have an independent manufacturing sector,” Xi said, hailing the country’s progress in complex industries like electric vehicles (EVs), high-speed rail, shipbuilding and aircraft manufacturing.
However, he also gave two separate warnings – once with the Jiangsu delegation and again with a panel of a political advisory body – that local authorities should consider local conditions in this drive for development to prevent blind investment and bubbles.
Solar panels, together with EVs and lithium batteries, have been touted as emerging growth and export engines, but complications like overcapacity and trade barriers present potential stumbling blocks.
Xi also said that traditional industries should not be given up in the name of hi-tech pursuits – a stance in line with last December’s tone-setting central economic work conference, where leaders vowed to “establish the new before abolishing the old”.
Traditional manufacturing still accounts for most industrial output, even with new sectors on the rise.
Vocational training was another subject Xi broached, recommending skilled workers be trained to generate the necessary human capital to move China up industrial chains.