UN adds China to top 25 list of most innovative economies in world; experts not surprised

China's innovation comes from years of heavy investment, so its placement in the top 25 most innovative economies in the world is taken in stride, experts said.

The United Nations' World Intellectual Property Organization said in a report released Tuesday that China moved up four places from 29th last year because it demonstrated consistent improvement in innovation.

A director of the organization said that in entering the top 25, China join upper-income countries that have traditionally dominated the top slots of the global innovation index.

To many, China's entrance into the top 25 is a long time coming, and various sectors in China have been leading the way in innovation far beyond what people outside of China may give the country credit for.

"It's the least surprising thing that China is an innovative country. It's way beyond the myth of 'they just imitate' - that has not been true for a long, long time," said Erik Gordon, a professor of entrepreneurship at the Ross School of Business at the University of Michigan.

"That's almost a form of orientalism at this point. To me, the surprising thing is the UN measure finally gotten into the top 25," he said.

Gordon said that China has been innovative in the medical and business sectors, particularly with medical devices and consumer banking, two areas where innovations are having an impact on large portions of the population.

China has been heavily investing in producing innovative medical devices to serve its aging population, and especially those who live in remote areas with poor access to healthcare, he said.

Medical costs have to be kept low, and China's innovation in the area may eventually be exported to other countries, such as Africa and even the United States, he said.

"China can plan over a long horizon, unlike in the US where every two years, or four years, or eight years, the Congress changes and (you) can't get a consistent anything. China can look ahead, and they did," Gordon said.

"They said, 'In order to be stable, we have to develop well. We have to make people's lives better.' You would think all politicians would think that way, but it was specifically on the table," he added.

Fu Xiaolan, a governing council member of the Technology Bank for the least developed countries, a UN establishment, said that China's placement is driven by the government's pursuit of innovation in the last 10 years. It's also important that many Chinese students who study overseas are now returning home to apply their knowledge domestically.

"China has a large pool of intelligent, bright people. China has the manpower. It also has a large market, and a large domestic market provides large advantages for innovators, because they can (get) larger returns (on those) innovations, and they can scale up their innovations in the domestic market," she said.

Edward Tse, founder and CEO of Gao Fend Advisory Company, said that China has made "leaps and bounds in innovation" to become the global epicenter of business innovation, particularly in tech-driven business innovation.

"Chinese entrepreneurs are very, very good in business model innovation. Look at [car-hailing app] Didi Chuxing. Uber China essentially said, 'You guys are so good that we have to give up China for you,' " he said, referring to the recent announcement that US car-hailing service Uber agreed to sell its China operations to Didi after the American company lost nearly $2 billion trying to establish a foothold in China.

"Another example is WeChat. Everybody in China is on WeChat. It's an innovation because it's so multifunctional that it's become the core of a lifestyle for so many people," Tse said.

Puneet Manchanda, a marketing professor at the Ross School of Business, also mentioned WeChat as an example, and said that the Chinese tech landscape has experienced the most notable rise in innovation over the last decade.

"I would say the last 10 years, in the age of innovation, where Chinese companies are producing stuff that Western companies have not thought of.

"So definitely, the rate is accelerating, and I think they'll keep getting better," he said.

amyhe@chinadailyusa.com