China’s investment in R&D as portion of GDP surpasses EU

Nature : In 2012 China invested 1.98% of its gross domestic product (GDP) in R&D (a figure termed “research intensity”), according to estimates from the Organization for Economic Co-operation and Development. That figure is just slightly higher than the European Union’s 1.96%. Since 1998, China’s research intensity has tripled while the EU’s has only slightly increased. However, China’s absolute spending on R&D is still only about one-third that of the EU. Partly responsible for the EU’s lagging research intensity is the addition of new members, such as Croatia. Whereas Germany invests 2.92% of its GDP in R&D, Croatia invests only 0.75%. The EU has a target research intensity of 3% by 2020, but does not control its individual member states’ investment rates. The measurement system has been criticized for various reasons, however. Research intensity doesn’t account for innovations that occur in the service-oriented industries that dominate Western economies. And in China, the investment is primarily in applied technologies and product development, not basic research. It is also centered on state-owned companies, which may actually suppress innovation.