China’s R&D spending continues to grow, but researchers are feeling the pinch

“China has achieved milestones in both of the two indicators,” Sun Yutao, a professor at Dalian University of Technology’s School of Economics and Management, said in an interview with the Post.

Zhang Qilong, a statistician with the National Bureau of Statistics, said it took China eight years to double its R&D spending from 1 to 2 trillion yuan.

“But only half that much time to reach 3 trillion,” he wrote in an analysis for the bureau.

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In terms of specifics, China spent more than 2.5 trillion yuan, or 82 per cent of total expenditures, on experimental development last year, compared with 348 billion yuan on applied research. China spent a record 202 billion yuan on basic research last year, ranking it second globally, but it amounted to just 6.57 per cent of China’s total R&D spending.

When the National Development and Reform Commission set China’s 14th five-year plan at the end of 2021, officials highlighted a significant gap in China’s basic research expenditures compared with major developed countries, where spending typically ranges between 15 to 25 per cent.

The commission proposed that by 2025, China’s spending on basic research should reach or exceed 8 per cent of total R&D spending.

Sun said that the negligible rise in basic research spending in 2022 could make reaching the 8 per cent target challenging.

Basic research – such as astronomy and mathematics – aims to better understand the fundamentals of how nature works. While it often has no immediate applications, it can form the basis of scientific and technological innovation.

The rate of growth of China’s R&D spending slowed from 2021 to 2022, with an overall increase of 10.1 per cent, compared with 14.6 per cent growth recorded from 2020 to 2021.

The trend was similar for basic research, in which the rate of growth fell from 23.9 per to 11.4 per cent in the same period.

“That can be understandable given the general faltering economic environment in China,” Sun said.

Meanwhile, per capita annual funding for researchers in 2022 was 484,000 yuan calculated on full-time working hours, a decrease of 5,000 yuan from the previous year.

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While the decline could mean there were more researchers competing for grants, Sun noted it could also be due to more time being spent on projects by researchers. “A more detailed analysis is needed to draw conclusions,” he said.

Still, Chinese researchers are facing stiffer competition for research funding in recent years.

According to the data from the National Natural Science Foundation, the overall funding rate has declined. From 2011 to 2016, about 24 per cent of applicants received support, but by 2023, that rate had dropped to 16 per cent.

The foundation, which operates under the Ministry of Science and Technology, is a major domestic source of funding for basic research.

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Last year, various enterprises accounted for most R&D users (77.6 per cent), while government-affiliated research institutions and higher education institutions represented 12.4 per cent and 7.8 per cent, respectively.

Zhang said that China should improve and diversify its methods of R&D spending.

The spending should be more efficient and focus on targeted support for key technologies and critical areas, while continuously increasing investment in basic research, he said.

South China Morning Post