China will become the world's second largest investor in research and development after the United States this year, the Organisation for Economic Co-operation and Development said Monday.
"The rapid rise of China in both money spent and researchers employed is stunning," Dirk Pilat, head of the OECD's Science and Technology Policy division, said in a statement. "To keep up, OECD countries need to make their research and innovation systems more efficient and find new ways to stimulate innovation in today's increasingly competitive global economy."
Based on recent trends, China will spend about 136 billion dollars on research and development in 2006, just over Japan's forecast 130 billion dollars, the OECD said. The United States is predicted to remain the world's leading investor in research and development in 2006, spending about 330 billion dollars, according to the organisation.
China's increasing spending on research partly reflects its overall economic expansion, but the OECD's research also suggested a greater emphasis on science as an engine of growth. China's spending on research and development as a percentage of its overall economy, known as R and D intensity, has more than doubled over the past decade, the organisation said.
It was 0.6 percent of the Chinese gross domestic product in 1995, rising to just over 1.2 percent in 2004. Over the same period, the number of Chinese researchers increased by 77 percent, and the country now ranks second world-wide with 926,000 people engaged in research, behind 1.3 million in the United States, the OECD said.
China's growing role in scientific research is reflected in a rapid expansion in the number of candidates graduating from the nation's universities. At the start of economic reform a generation ago, China produced almost no Ph.D. candidates but by 2003, a total of 13,000 doctorates were awarded, 70 percent of them in science and engineering, according to official data.
Typically, their annual salary is about 100,000 yuan (13,000 dollars), compared with 100,000 dollars for a western Ph. D. candidate. Swiss pharmaceutical giant Novartis said last month it planned a 100-million-dollar research center in China's largest city Shanghai, possibly being the first in a new trend, according to observers.