Xiong Hongru: Seizing Opportunities to Strengthen Original and Disruptive Scientific and Technological Innovation
Whether a country can continuously produce major original and disruptive technological achievements is the primary factor in measuring whether it possesses world-leading scientific and technological strength and innovation capabilities. Since the New Era, China’s scientific and technological innovation has shifted from the accumulation of quantity to a leap in quality, and from point breakthroughs to the enhancement of systemic capabilities, increasingly approaching the global technological frontier. Facing the future, to shape new driving forces and advantages for development within a more severe and complex internal and external environment, we must change our innovation path. This entails shifting from a primary reliance on "tracking-type" and incremental innovation toward a greater reliance on pioneering and leading innovation, thereby achieving a leap in the overall efficiency of the national innovation system.
Seizing Opportunities in the Rapid Iteration of Technology Markets
Currently, a new round of technological revolution and industrial transformation is developing in depth. Digital technologies—represented by artificial intelligence and advanced computing—are accelerating breakthroughs. Technological innovation and transformation in fields such as life sciences, new energy, new materials, advanced manufacturing, and deep space/deep sea are exerting an unprecedented and profound influence on global industrial, supply, and value chains. Production methods characterized by intelligence, networking, and distribution are changing the original "center-periphery" [1] pattern of international division of labor and reshaping the economic competitiveness of various nations and the landscape of global competition. Seizing the "commanding heights" [2] of technology and industry has become a vital factor affecting the developmental initiative and strategic competitiveness of major powers. Furthermore, the relative status of traditional and new factors of production is facing reconstruction. The connotation of moves toward high-end industrial structures has changed significantly; it is now more reflected in improvements in marginal efficiency and the enhancement of total factor productivity resulting from inputs of factors such as technology and data. Only by seizing rapidly iterating technological and market opportunities and accelerating the construction of new competitive advantages can we fully enjoy the dividends brought by this round of technological revolution.
Major technological breakthroughs in history have mostly exhibited strong "discontinuity"—that is, new technologies often adopt entirely different routes or mechanisms from mainstream technologies. For example, transistor technology replaced vacuum tubes, digital communication replaced analog, and power batteries are gradually replacing internal combustion engines. This discontinuous innovation generally possesses strong technical uncertainty and market disruptiveness, bringing a massive "creative destruction" effect to existing industrial development. For late-developing countries [3], the importance of discontinuous innovation is unprecedented in the current situation of accelerated technological progress and rising protectionism. On the one hand, to change the situation where core technologies are "controlled by others" (literally "choked by the neck" [4]) and to construct "asymmetric advantages," there is an urgent need to strengthen discontinuous innovation. Extensive practice shows that if discontinuous innovation capacity is lacking under conditions of intensified external technical restrictions and faster iteration, the speed of technical progress may slow down or even stagnate, and the technical gap will widen. On the other hand, discontinuous innovation can produce disruptive effects, which are of great significance to the economic, industrial, and even national security of all countries, especially late-developing ones. Whether in AI, quantum computing, or synthetic biology, the universality, autonomy, and asymmetry of such technologies are becoming increasingly prominent; seeking discontinuous innovation will be an unavoidable dominant strategy.
Possession of Many Favorable Conditions
China's level of investment in science and technology is basically adapted to its current stage of development, the quality of its technological output continues to improve rapidly, and its supply capacity is increasingly strengthening. From the perspective of investment levels, since entering this century, China is the only large economy whose share of global R&D investment has maintained growth; currently, its R&D intensity has exceeded the average level of OECD countries. From the perspective of output levels, in 2022, the number of papers published by China in the most influential journals across various disciplines reached 16,349, accounting for 30.3% of the world total, ranking first in the world for the first time and surpassing the United States. In 2023, international patent applications submitted by Chinese applicants through the Patent Cooperation Treaty (PCT) reached nearly 70,000, ranking first in the world for five consecutive years. From the perspective of technical capabilities, first, advanced technology is shifting from a reliance on external sources to a "dual-wheel drive" of both external and endogenous sources. According to estimates, the proportion of internal R&D expenditures used for introducing foreign technology in China's large and medium-sized high-tech enterprises dropped from 30%–40% (2000–2009) to 4%–6% (2010–2019). Second, basic research supporting the supply of "source technologies" has been significantly strengthened. From 2012 to 2023, China’s basic research funding rose from 49.88 billion yuan to 225.91 billion yuan, and its share of total R&D investment rose from 4.8% to 6.77%.
The scale, structure, and quality of the supply of innovation factors have improved significantly. In recent years, China's level of training and attracting scientific talent has strengthened markedly, and the "talent dividend" is gradually becoming apparent. Currently, China’s total scientific and technological human resources rank first in the world. Looking at top-tier talent, the 2023 Highly Cited Researchers list shows that among 6,849 researchers from 67 countries and regions, 1,275 from mainland China were selected; this share rose from 7.9% in 2018 to 17.9%, ranking second globally. China possesses the scientific and digital infrastructure conditions to enter the global "first tier," having deployed and constructed 77 major national science and technology infrastructure projects. Large-scale scientific facilities—represented by the Five-hundred-meter Aperture Spherical Radio Telescope (FAST), the Spallation Neutron Source, the High Altitude Cosmic Ray Observatory (LHAASO), and the Experimental Advanced Superconducting Tokamak (EAST)—provide important platforms for conducting basic frontier research. The 5G network, fiber optic broadband, and mobile internet-of-things (IoT) networks have expanded and accelerated. Total computing power has reached 230 EFLOPS, ranking second in the world. Data production maintains a rapid growth trend, with the national total reaching 32.85 ZB in 2023, providing powerful support for development in "new fields and new tracks" such as big data, AI, and advanced manufacturing.
The motivation and capability of innovation subjects have increased substantially. After years of catching up, the overall innovation activity of Chinese enterprises has risen significantly, and the group of high-growth enterprises continues to expand. In 2022, there were 176,000 industrial enterprises above designated size [5] with R&D activities, accounting for 37.3% of the total, an increase of 26.7 percentage points over 2000. R&D expenditures for these enterprises reached 1.9362 trillion yuan, with an R&D intensity of 1.4%, up 1.2 percentage points from 2000. According to the "2023 EU Industrial R&D Investment Scoreboard," 679 mainland Chinese enterprises were included in the "Global Top 2500 R&D Investors," accounting for 27.2% of the total, second only to the United States.
The advantage of economies of scale supporting major-power innovation is prominent. This advantage is a distinctive competitive strength for China, especially in the context of accelerated technological progress and the deep adjustment of economic globalization. From the supply side, China possesses the world's most complete industrial system, and the value-added of its manufacturing industry has ranked first in the world for many consecutive years. Economies of scale help enterprises dilute costs, facilitate mutual learning and technology diffusion, and allow different firms to experiment with various technical routes and business models, providing vast growth space for enterprises in numerous niche sectors. From the demand side, China has become the world's second-largest consumer market. With the rise in resident income levels and the expansion of the middle-income group, the advantages of a super-large-scale market will become even more prominent. As the world's largest trading nation, the second-largest importer, and a major source and destination for foreign direct investment (FDI), the sheer scale and diversity of consumption demand are conducive to large-scale innovation trials and lower the costs of discontinuous innovation.
Constructing New Competitive Advantages in Technology and Industry
Although China has made significant progress in science and technology, its original innovation capability remains relatively weak. Some key core technologies are still "controlled by others," and there is a shortage of top-tier scientific talent. We must further increase our sense of urgency and intensify scientific innovation to seize the commanding heights of technological competition and future development. To build future competitive advantages, we must place greater importance on original and disruptive technological innovation, providing support for national development and security through high-quality self-reliance and strength in science and technology [6].
First, we must improve the level of basic research and the forward-looking, leading layout of scientific and technological plans. We must insist on placing original capacity in a prominent position, coordinating "goal-oriented" basic research with "free exploration" basic research, supporting high-risk, high-value research, and promoting collaborative efforts between industry, university, and research institutes to tackle major scientific problems in industrial innovation. We should improve the mechanism for basic research investment that combines competitive support with stable support, encouraging qualified enterprises and social organizations to increase their backing. We must establish a mechanism for refining scientific plans that combines "top-down" and "bottom-up" approaches, accelerating the layout of strategic, overall, and forward-looking major technological tasks. Based on the realities of different tasks, we should adopt a more flexible and open attitude, promoting synergy among various subjects and allowing market mechanisms to play a full role in talent selection and resource allocation. We must break away from quantitative and indicator-based assessments, deepen the reform of science and technology evaluation, and better leverage the role of the scientific community.
Second, we must coordinately strengthen strategic scientific and technological forces alongside market-oriented innovation forces. On one hand, we should strengthen the systemic development of national strategic scientific forces. This involves improving the system of national laboratories with Chinese characteristics—led by national laboratories and supported by key national laboratories—and optimizing the positioning and layout of national research institutions, high-level research universities, and leading technology enterprises. On the other hand, we must strengthen the principal position of enterprises in technological innovation and their international competitiveness. Highlighting a "problem-oriented" approach and mid-to-long-term incentives, we must ensure that innovation policies favoring enterprises—such as R&D support, transformation of achievements, access for new technologies/products, government procurement, and intellectual property protection—are solidly implemented. We support leading technology enterprises in leveraging their advantages in market demand, integrated innovation, and organizational platforms to lead key and emerging industries toward the high end of global value chains.
Third, we must build a talent development, financial support, and industrial system compatible with original innovation. We should coordinately advance the integrated reform of the education, technology, and talent systems, improve the cultivation model for top-notch innovative talent, and place greater emphasis on fostering the scientific spirit, innovation capability, and critical thinking. We should improve the mechanism for the orderly flow of talent across departments and regions and implement more proactive and open policies for "attracting, using, and retaining" talent. We should improve support policies for long-term capital to "invest early, invest small, and invest for the long term," accelerating the development of angel investment, venture capital, and private equity, while better leveraging the role of government guidance funds and accelerating capital market reforms. Finally, we should expand advanced manufacturing clusters and establish a growth mechanism for investment in future industries.
Finally, we must enhance our global innovation position through "high-level opening up." We should continue to strengthen the construction of an internationalized research environment, expand non-governmental international cooperation in advantageous and emerging fields, and improve the mechanisms for the development of foreign-funded high-tech enterprises and international scientific organizations in China. We should participate deeply in global science and technology governance and strive to build a community of win-win cooperation. We will further increase the intensity of "institutional opening up," establishing a system of rules in areas such as market access, factor flow, intellectual property, fair competition, and industry regulation that aligns with international standards, thereby creating a stable, transparent, and predictable first-class business environment and an open innovation ecosystem with global competitiveness.
(The author is the Director and Researcher of the Innovation Development Research Department of the Development Research Center of the State Council)
Source: Economic Daily (January 22, 2024)