2. China’s investment in R&D
rocketing –leading the world now
GERD (in PPP US$ billions) % Share of world GERD
2007 2009 2011 2013 2007 1009 2011 2013
China 116.0 169.4 220.6 290.1 10.2 13.8 16.5 19.6
Japan 139.9 126.9 133.2 141.4 12.4 10.4 9.9 9.6
USA 359.4 373.5 382.1 396.7 31.7 30.5 28.5 28.1
GERD as % of GDP
2007 2009 2011 2013
China 1.40 1.70 1.84 2.08
Japan 3.46 3.36 3.38 3.47
Israel 4.48 4.15 4.10 4.21
Korea 3.00 3.29 3.74 4.15
Germany 2.45 2.73 2.80 2.85
France 2.02 2.21 2.19 2.23
USA 2.63 2.82 2.77 2.81
Source: UNESCO Science Report: Towards 2030, Paris, 2015
Second
only to
the US
China’s investment to upgrade
and transform its economy -
China Manufacturing 2025
(sim. to Germany’s Industry
4.0, & Internet Plus – from low
cost labour intensive to Science-
based & R & D intensive
3. R & D researchers (in thousands) % of the
world
2007 2009 2011 2013
China n/a 1152.3 1318.1 1484.0 19.1
Japan 684.3 655.5 656.7 660.5 8.5
USA 1133.6 1251.0 1252.9 1265.1 16.7
Source: UNESCO
Science Report: Towards
2030, Paris, 2015
Source:
http://www.innovativechina.
com/wp-
content/uploads/2013/10/0
00069-
nesta_china_map_inputs.jpg
China in 2011
China leads
the world in
no. of
researchers &
is producing
the largest no.
of engineers &
technicians
4. China is also on the transition to a more sustainable energy
regime with an increasing share of renewable energy –
strong implications for economy (technology) & society
Source: Stephen Stapczynski, Emi Urabe, Aibing Guo, Westinghouse
Races China for $1 Trillion Nuclear Power Prize, Bloomberg, December
10, 2015
Sources: http://green-
blog.org/uploads/gallery/category_3/gallery_2_3_9026.jpg &
http://www.altenergymag.com/content.php?post_type=2252
International Clean Energy Race
Non-fossil fuel in Chinese electricity
generation is 30-40% to go up to over
50% in 2030 & over 60% in 2050
5. Made in China – the comprehensive plan to
upgrade China’s industry in 10-year plans
"Made in China 2025" is the first 10-year action plan designed to transform
China from a manufacturing giant into a world manufacturing power. The 10-
year plan will be followed by another two plans in order to transform China
into a leading manufacturing power by the year 2049
9 priority tasks
improving manufacturing innovation
integrating information technology and industry
strengthening the industrial base
fostering Chinese brands
enforcing green manufacturing
promoting breakthroughs in 10 key sector
advancing restructuring of the manufacturing sector
promoting service-oriented manufacturing
& manufacturing-related service industries
internationalizing manufacturing
Source: https://cdn2.scmp.com/sites/default/files/2015/06/08/made-in-china-2025.jpg
10 industrial focuses
6. ‘Made in China 2025’ – basically with reference to the
German and Japanese industrial strategy departing from the US model
Germany’s ‘Industrie 4.0’
Project, as part of its High-
Tech Strategy 2020, focuses
on intelligent manufacturing,
i.e., applying the tools of
information technology to
production; this primarily
means using the Internet of
Things to connect small and
medium-sized companies
more efficiently in global
production and innovation
networks so that they could
not only more efficiently
engage in mass production
but just as easily and
efficiently customize
products - Scott Kennedy, June 1,
2015, the Center for Strategic
and International Studies.
Open, versatile & cloud
platform for anything &
everythingSource: Global Retail Research – Fung Business Intelligence Centre
China has a broader approach as it needs to upgrade the
entire industries and economy but intelligent manufacturing
will be the focus, the Internet Plus strategy, with the Internet
of Things as the centre together with cloud technology, etc.
7. The demand & innovation
driven urge for the Internet
Plus strategy by 2015
•Broadband Internet users: 649 million users
•Mobile Internet penetration: 555 million users
•4G users: 162 million users (should be 250
million users by the end of 2015)
•Mobile Internet revenues: US$1.8 trillion (2014)
Internet users & penetration rateSources: www.innovationiseverywhere.com &
Ali Research
2015
The world’s largest use of apps (surpassing the US)
& most innovative – even with the use of QR codes
8. China has become capital exporting county -
overseas investment by end 2014
Source: Heritage
Foundation, quoted
in
http://business.fin
ancialpost.com/bu
siness-
insider/china-has-
crossed-a-major-
investment-
threshold-that-is-
going-to-change-
the-entire-world
9. The resurgence of China in the 2010s make the
silk road strategy feasible and essential for China
and the countries involved
1. Diversification of trade and rapid growth of overseas investments of
China since the 21st Century have tied China more to Asian, European
and African countries rather than dependent on the US and Japan.
2. China has accumulated huge wealth in the form of its massive foreign
exchange reserve and the partial convertibility of Renminbi for use in
neighbouring countries and in bilateral trades.
China’s foreign reserve in US$ 100
millions (at end of year)
2000 1,655
2005 8,188
2010 28,473
2015 (August) 35,573
World’ top nations in terms of foreign reserve (including
gold) at end 2014 (in US$ 100 millions) by World Bank
China 39,000 Russia 3,862
Japan 12,606 Brazil 3,635
Saudi Arabia 7,444 Hong Kong,
PRC
3,285
Switzerland 5,457 India 3,250
USA 4,344 Singapore 2,615
10. Reindustrialization of China
• Science-based & internet connected – the defense
sector will be the leading force and has strong
spilling over effect on the civilian economy – high
speed railway, large aircrafts, advanced
telecommunications (including quantum
networking), nuclear & other energy systems, with
many disruptive technologies.
• Internet led transformation of conventional
manufacturing – lifestyle industries – transaction
cost reduction, shrinking scale economy, system
integration.
• Culture and craftsmanship – from functional
products to cultural/symbolic products embedded
in history and civilization values
11. Reindustrialization in PRD
The national connectivity
China’s high speed railways in 2016 Medium-long term high speed railway
network plan as promulgated in July 2016
1. 8-horizontal & 8-vertical
network at 250 km/hr;
2. Covers all cities with 0.5
million population;
3. Creates 0.5 ~ 4-hour city
clusters
12. The local connectivity
A regional 3 hour economic
zone with city-centered one-
hour zones within
13. Socio-economic background
• 50-60 million population;
• Annual retail sales volume close
to 2000 billion yuan with the
highest per capita retail sales in
China
• China main export base
• World class production centres
– electrical appliances,
telecommunications, etc.
• China’s main civilian innovation
and entrepreneurial base
• Largest integrated regional
metropolitan area in China
What will be the future of re-
industrialization in the PRD?
• Internet service &
hardware industries
• Upgraded lifestyle
industries, esp. electrical
appliances
• Upgraded conventional
industries, esp. new energy
atuos
