Study warns of global competition in the field of technology

In the future German companies will face increasing competition in the field of technology from Asian countries such as India and in particular China. This is the finding of the »Technologische Leistungsfähigkeit Deutschlands« study which was conducted jointly by several institutes led by the Centre for European Economic Research (ZEW) on behalf of the Federal Ministry for Education and Research.

According to the study the global economy is changing rapidly due to breathtaking economic growth driven by certain states. However, in Asia there are countries such as India, South Korea, Singapore and in particular China which since the mid 1990s do not count on economic growth alone any more, but which do everything possible in order to catch up with the Western industrialized countries in terms of research and development (R&D). By extending their R&D activities, by investing in the education of highly skilled people they manage, in the opinion of experts, to create the necessary infrastructure in order to go from imitative to original innovation.

A successful example for this development is China. The share of China in global expenditure on research and development has increased from 4% in 1996 to almost 11% in the year 2004. Thus, China in 2004 spent almost twice as much as Germany on research and development and there were two and a half times more people in China working in R&D than in Germany. Furthermore, an ever increasing number of scientific documents is published in the emergent Asian countries. However, with regard to products offered on international markets the increased investment in R&D has so far not yet made itself felt very much. This, according to analysts, is however just a question of time.

Analysts say that German companies will only be successful in the international arena by concentrating on innovation which will require additional efforts. Furthermore, international division of labour in the field of R&D will force highly developed national economies to specialize even further. In some sectors further job cuts in the R&D intensive fields of industry will be unavoidable. GERMAN