Chinese Science and Technology Industrial Parks - A note

Rapid economic development has taken place in China since the late 1970s. Chinese science and technology industrial parks (STIPs) have been established in China to foster technology transfer and technology development.  

The establishment and development of science and technology industrial parks aimed to provide an optimized environment to transform R&D achievements into real productivity, attract and congregate talented people, technologies and capital by providing whole set of service system and preferential policies, create industry congregation, speed up industrialization of high and new technology. From the very beginning, the parks have attached much importance to linkages between high-tech development and market demand at home and abroad. They provide the following functions:

• Bases for the development of new technologies;
• Sources of new technologies and products for traditional industries;
• Windows opening to the outside world;
• Experimental zones for close combination of science and technology with economy, and promotion of transformation of achievements of science and technology and technical innovation;
• Demonstrative zones for close combination of science and technology with economy, and promotion of transformation of achievements of science and technology and technical innovation;
• New urban areas of modern civilization;
• Schools for training and bringing up high technology industrialist.

There are typically three development periods for Chinese national science and technology parks. The first is elementary period. The main works, in this period, are making preferential policies and development plan, plotting zone area, building infrastructure and service systems. The second is fast development period. The main works are growing high-tech industrial enterprises, establishing advanced administrative mechanism, consummating infrastructure and service system, improving investment environment, attracting and introducing local and overseas investors and enterprises. The third period is characteristic industry centralization period. The main works are attracting and supporting core enterprises from home and overseas or establishing joint venture compatible with local advantageous industry, congregating related supporting enterprises (include supply, distribution and various services etc.) to form characteristic industry centralization.

There are about 53 national science and technology industrial parks in China. Most national science and technology parks have past two periods and have entered or begun to enter the third period. Some specialized parks are formed within one science and technology industrial park. For instance, there is Software Park, electronic industry park, environment Protection Park in Changzhou National Hi-tech District. There are Software Park, biology and biochemistry technology industrial park and Optoelectronics Park in Chongqing Hi-Tech Industry Development Zone. The Government has introduced several policies for technological advancement. These include the 863 Plan, Torch Programme, Incubator Programmes, and 973 Plan. Policies like the 863 and 973 plans straddle civilian and defense S&T agencies and foster the development of critical dual-use technologies such as information technology, aerospace, and lasers. 

STIPs are divided into three types each with distinct characteristics. Multinational development zones, including samples of Shenzhen, Dongguan, and Suzhou, emphasize the role of TNCs (transnational corporations) as growth engines as these companies come to invest in China to make use of inexpensive labor and tap the potential large domestic market. Shanghai is considered an example of a multinational learning zone and most likely to succeed in learning high-tech from foreign companies. On the other hand, local innovation learning zones (examples include Beijing, Xi`an) are more reliant on domestically generated technology with some interactions with foreign companies.  

, University-affiliated indigenous high-tech enterprises have emerged in Beijing. Due to its isolated location, Xi’an draws heavily on local university resources and its close ties to a military-industrial complex. Other than massive investment from Hong Kong and overseas Chinese, Shenzhen also utilizes technology transfer from universities in Beijing effectively. One important finding is that some types of technology transfer such as worker training and innovation co-modification do occur, although there is little explicit technology transfer to STIPs from TNCs. The TNCs are attracted to STIPs to make use of local advantages in the parks, advanced production technology, and products. Thus STIPs partially achieve the objective of producing high-tech products by using, rather than acquiring in most cases, TNCs’ advanced technology. The reasons why technology transfer rarely takes place include the concerns about intellectual property protection and the difficulty of obtaining qualified highly skilled labor such as electrical engineers. Many R&D centers established by TNCs in STIPs mainly engage in modification for Chinese domestic market. Many production activities involve just assembly operations using cheap labor with most input imported under the slogan of global sourcing and local assembly. It is clear that a lot of raw materials and components have been imported into China from elsewhere in the world. This explains the equally rapid growth in Chinese imports alongside its expanding exports. 

A survey of STIPs in China reveals the difference between Chinese companies and foreign companies operating in STIPs and the difference in STIPs in different regional and city contexts. The STIPs have been playing an increasingly important role in national economic growth and social development.