China’s Spending on R&D Reaches Record High

By Thomas Price Monday, March 1, 2021

Economic growth and power has been a major focal point of many nations in recent years, and investing in technological innovation has been the key to doing so. This is why it comes as no surprise that China recently reached an all-time high in annual research and development (R&D) spending, pushing to maintain dominance in several economic fields. Both the United States (US) and the United Kingdom (UK) have been increasing their own R&D spending in order to stay competitive with China as the rate of technological progress continues to speed up.

Chinese flag flying next to skyscrapers in Shanghai.

China’s Spending in 2020

National R&D spending has always been a difficult number to precisely quantify given the amount of money being spent by private companies or businesses on products and technology. However, when accounting simply for federal spending on the matter, the number becomes far clearer.

In 2020, according to the National Bureau of Statistics, China spent a record $378 billion on R&D. This is a 10.3% increase from the prior year and an all-time high since the statistic has been tracked. A rise of just over 10% is also the slowest incremental growth year-over-year (YOY) in over five years, suggesting that China’s wild economic growth may be reaching more stable levels. For instance, in 2019, China’s year-over-year increase in research and development was over 2% higher than that of 2020 at 12.5%.

Unlike the US or other nations, where a large portion of technological innovation comes from private companies or other businesses, China’s federal government is often the main spender. In fact, the country has 522 national key laboratories and 350 national engineering research centers currently in operation, according to the report.

On top of that, an incredible 457,000 different projects received funding from the National Natural Science Foundation of China, further showing the government support in economic development from businesses in the country. This led to the country approving over 40% more patents in 2020 than the year before at 3.6 million total.

Other Nations’ Spending and Rising Economic Tensions

While obviously the nature of China’s economy, which features far more government participation, and the size of China itself plays a part in the record R&D spending. No other country is remotely close to that number. In fact, the US was slated to only spend $134.1 billion on R&D, though the official figure on the year has not yet been made public.

The UK spent £11.4 billion ($15.9 billion) in 2020 on the same field, though the nation has plans to nearly double that figure by 2025 at the latest. Much of the spending from China and others in the area falls back on rising economic tensions, causing the countries to look for ways to be more economically independent.

About the Author


Headshot of Thomas Price

Tom Price is a writer focusing on entertainment and sports features. He has a degree from NYU in English with a minor in Creative Writing. He has been previously published for Washington Square News, Dignitas, CBR, and Numbers on the Boards.

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