The reality of transferring technology to China: What has been learned after 15 years?

The transfer of technology to China, especially in the manufacturing sector, is considered to be a major contributor to its recent economic growth. However, we must distinguish between technology transferred by foreign companies into their wholly or majority-owned subsidiaries in China and the technology acquired by indigenous enterprises. It is only through the successful acquisition of technological capability by indigenous enterprises, many of which
still remain state-owned, that China can become a really innovative and competitive economic power and not remain the world’s workshop. The authors revisited a number of state-owned industrial companies in Beijing and Tianjin, initially studied during the 1990s, to assess the levels of capability attained and the role of external sources and internal efforts in developing capabilities. Chinese public sector enterprise appear to be broadly following the East Asian model in which success has depended on technological and commercial
collaborations with foreign firms, internal efforts to develop technological competence and being responsive to market conditions and policy changes.