Delivered-To: dfarber+@xxxxxxxxxxxxxxxxxx
Date: Sun, 19 Oct 2003 16:39:21 -0300
From: Claudio Gutierrez <cgutierrez@xxxxxxxxxxxxxx>
Subject: China's Technological Ambitions Take Flight
To: dave@xxxxxxxxxx
by James Flanigan, LA Times
Everyone knows China is a low-wage, low-cost manufacturing juggernaut.
But the world had better watch out: It is also on its way to becoming a
high-tech behemoth.
That was underscored last week when China sent a man into space. At the
same time, to much less fanfare, Chinese doctors made their own leap,
taking the nucleus of an ovary from one woman and implanting it in the
ovary of another, allowing her possibly to conceive a child. And such
achievements are becoming increasingly common.
"China is going to be a technological powerhouse," says Paul Saffo,
director of the Institute for the Future in Menlo Park, Calif. "They are
being very strategic ? making sure that they gain technological
knowledge as part of their manufacturing activities."
China's technological drive may come as a surprise to those accustomed
to viewing it as simply a low-wage workshop, exporting shoes and
T-shirts and all sorts of paraphernalia and roiling other economies in
the process. But manufacturing is only one stage in China's economic
development. In fact, what's most significant about China today is not
the growth of its assembly lines but that of its graduating classes.
Rob Koepp, a scholar at the Milken Institute in Santa Monica, points out
a statistic. "China graduates 450,000 engineers each year ? as many as
the United States." He adds that the country's aim isn't "merely to
catch up with the West" but to "bring about fundamentally innovative
technology over time" that will set standards for the whole world.
In many ways, China's technological ambitions can't help but influence
global industry. For example, it is deploying an extremely advanced
system for cellular telephones, called third generation. And because
there are 200 million Chinese cellphone users, more than any other
country, China's system inevitably will be become a leading global
standard.
In software, China is pushing for a new standard that would allow the
Internet to accommodate more users. China's software industry is still
relatively small ? less than one-third the size of India's ? but it's
growing exponentially, like so much else there. So if it starts using an
advanced Internet protocol, the rest of the world could be forced to
adopt it too.
It's true that in telecommunications, space flight, biomedicine and
elsewhere, China is largely building on innovations that originated in
the U.S. and other countries. And China's total research spending right
now is less than 1% of its annual gross domestic product of $1.4
trillion.
But that GDP is growing at an annual rate of 8%. Research and
development spending is expanding. Beijing is setting up high-tech
centers around the country to come up with the next big thing in
electronics, biotechnology and nanotechnology. The Ministry of Science
and Industry has hired Koepp of the Milken Institute to advise it on how
Silicon Valley and other centers of high-tech development came about in
this country.
Even now, in technology, China poses "a competitiveness challenge," says
Dwight W. Decker, chairman and chief executive of Conexant Systems Inc.
in Newport Beach, a maker of semiconductor chip sets.
Just this month, Conexant entered an agreement with Huawei Technologies
Inc. of Shenzhen, China, which makes network switches and routers for
Internet traffic. Huawei, a huge $2.4-billion firm, will use Conexant's
chip sets to allow giant China Telecom to give its customers broadband
Internet connections.
Conexant won the contract because of the excellence of its technology.
But Decker has no illusions. He knows his researchers and chip designers
will have to work hard to develop the next technological wrinkle in chip
sets, and the next after that, to stay in the game ? because China is
trying to develop original chip-set software.
"They want to be a leader, in software, in wireless technology, in TV,"
Decker says, and the list goes on.
Andrew S. Grove, the chairman of Intel Corp., warned in a recent speech
that America was risking its lead in technology and its living
standards, because research and development funding was declining here
and "university enrollment in science and engineering has been trending
downward over the last decade."
Meanwhile, China is a country coming alive. Shoucheng Zhang, a physics
professor at Stanford University who also teaches at Tsing-hua
University in Beijing, can't help but notice it when he returns to his
native land. "I love to see the young people changing the world, hanging
China," he says.
Zhang knows that to develop truly original technology, China's Communist
government must have the "political will" to protect intellectual
property as the West does, with patent and copyright laws. And he
believes such change is inevitable.
So does Koepp, who sees many forces for change, including what he calls
the "reverse brain drain." It used to be that three-fourths of Chinese
students who came to the U.S. for their PhDs and other degrees ended up
staying here to work. Now, Koepp notes, the figures "are reversed, and
75% go back to China because they see opportunity ? and even fewer
restrictions."
"I know a biotech researcher who has returned to Shanghai because she
can work with stem cells there while she would be restricted here," he
says. Likewise, Europe's bans on working with genetic crop materials are
driving Chinese students home from that continent.
We should be clear. China's pursuit of technology and innovation is a
potential boon for the world.
And if along the way China gives the U.S. a new competitive shock, well,
that might not be a bad thing. It could be the wake-up call we need to
remind us we want to remain the New York Yankees of world technology and
not become its Boston Red Sox.
http://www.latimes.com/technology/la-fi-flan19oct19,1,976109.column?coll=la-headlines-technology