China Clears Barriers To Facilitate Innovation

Chinese officials have pledged continuing structural reforms to facilitate innovation driven growth. Ministers from the National Development and Reform Commission, or NDRC, and Ministry of Information and Industry met the press in late March.

CNTV reported that the Vice Chairman of the NDRC, Lin Nianxiu, stated the lack of cohesive and supporting policies and poor intellectual property protection as being among the main barriers to innovation.

He said that Chinese companies generally rely on capacity expansion, price wars, monopolization , and low-level competition to gain a competitive edge while the ratio of R&D input remains less than 1% of revenue.

The Vice Chairman said the current technology transfer and rate of dissemination are low, and market forces has not been brought into full play. He said the government plans to take several measures to address the issue.

“Our priority is to cultivate an institutional environment that encourages mass innovation. For example, we plan to lower the punishment threshold for Intellectual Property Rights violation, and implement a punitive compensation system,” he said.

“We also plan to inhibit monopolistic acitivities and curb these companies from making easy profits by extending their business to the upper and lower industry chains. We will increase our support for the inclusive fiscal and taxation policies, and give our full backing for creativity and innovation in science.”