TMCD Newsletter - JUNE 2015

Where does China's foreign investment have the biggest impact?

TMCD Newsletter - June 2015

A newsletter of the Technology & Management Centre for Development at Oxford University

China’s Path to Innovation: a major new book by Xiaolan Fu

Professor Fu’s new book, China’s Path to Innovation has been highly praised by China experts, with Harvard University’s Caletous Juma describing it as "a masterpiece on comparative Chinese innovation studies”. 
This major work investigates how China can develop a strategy of compressed development to emerge as a leading innovative nation. Aimed at scholars and policy-makers, it fills a significant gap in the literature analysing China’s experience of innovation over three decades and discussing the implications for other countries. “Her masterful book points the way towards 'open innovation with Chinese characteristics'," commented by Henry Chesbrough, author of Open Innovation and Professor at University of California, Berkeley.
"Finally, we have an analytical volume that combines economic theory, international experience and China's socio-economic conditions to formulate a most credible strategy to greatly strengthen China's capacity to innovate,” says Wing Thye Woo, President of Jeffrey Cheah Institute on Southeast Asia, Malaysia and Professor at University of California, Davis.

The book draws on quantitative as well as qualitative research and uses different theoretical approaches to examine the motivations, obstacles and consequences of China's innovation.

Click here to find out more.

What impact does Chinese investment have on host economies?

Since introducing its going global strategy in the mid-1990s, China’s outward foreign direct investment (OFDI) has increased rapidly, but views are divided on what benefits this confers on the host economies. 

A new study, by Professor Xiaolan Fu at TMCD and Peter J. Buckley at Leeds University Business School, dissects data from a wide range of sources on 97 developing countries where Chinese companies were active between 2004 and 2010. 

The study’s findings were that:

  • Chinese OFDI in developing countries has a significant impact on the growth of host economies.
  • The long-term impact is positive – but the effects are unlikely to be apparent in the first two years whilst production capacity is built up.
  • The impact of Chinese investment is greatest in African, less significant in Asia and insignificant in Latin America.
  • The impact is greater in countries that are resource-poor than it is in those possessing large reserves of natural resources

Read more. . . 


Xiaolan Fu underlines crucial role of tech transfer and capacity building at UN High-level Symposium

This year’s UN Development Cooperation Forum (DCF) High-level Symposium brought governments, civil society and other stakeholders together in South Korea to examine how development cooperation can work in practice to aid implementation of the post-2015 development agenda.
Professor Fu led a workshop at the symposium examining how technology facilitation and capacity building can best be advanced and what role they can play in helping achieve global development goals. The workshop generated ideas and messages for inclusion in the symposium’s policy recommendations.

Read more. . . 

Who are Africa’s economic Goliaths?

TMCD team-members (Jun Hou and Serena Masino) have been exploring the roles and impact of multinationals (MNEs) from China and western countries on Africa’s economy.

Their preliminary research finds a diverse picture of Chinese foreign direct investment (FDI) penetrating different layers of Africa’s economy.
State-owned enterprises mainly invest in strategic sectors such as infrastructure, oil, or ores. In meeting one of Africa’s fundamental needs, the infrastructure improvements, directly serve and stimulate economic development.
Large private-sector enterprises are mainly involved in non-infrastructure projects such as manufactured goods, telecommunications and wholesale trade. Through linking local partners, their presence is expected to induce positive spillovers that enhance the technological and managerial capability of local industries. A notable example is the participation of Chinese telecommunication companies (e.g. Huawei Technology) in the construction of Information and Communication Technology (ICT) facilities, including a fibre-optic transmission backbone, telephone, mobile communication, and the Internet.  Not only have they upgraded the service in terms of coverage, quality and price, but they have also offered a potential technological spillovers that facilitate local actors in upgrading their own strategic capability.
SMEs (small and medium-sized enterprises) have also created enormous technological learning potential for African enterprises. Some of them are dominant in light industry and, compared with the technologies introduced by advanced countries, the superior technologies they’ve mastered are acknowledged to be more appropriate for African engineers to learn. 

Read more. . .

The impact of R&D networking on Chile’s biotech sector

Carmen Contreras Romero’s research on Chile’s biotech sector uses publication and patent application data to measure the impact of local and international collaboration on knowledge creation.
Carmen’s results suggest that international relationships with R&D-oriented partners have more impact than other networks on the creation of publications. By contrast, the research found weak evidence that such relationships were relevant in the case of patent applications. However,informal linkages with local R&D-oriented partners have more impact on patent application than on publications. Overall, her investigations have found strong evidence of the importance of informal connections as well as the relative influence of international over local linkages. 

Welcomes and goodbyes

We’d like to extend a warm welcome to our new visiting fellows Bruce McKern and Guobing Shen. Bruce McKern, who will be joining us from July to December this year, is from Stanford University's Hoover Institution. His research interests are innovation in China by local and foreign companies, as well as the strategies of emerging multi-national companies from rapidly developing economies. Guobing Shen is a professor of world economy at the School of Economics of Fudan University in China, who will be joining us between August 2015 and February 2016. His research currently focuses on world economy, international finance, and US/China trade issues. 
And it’s goodbye to Giacomo Zanello, who’s left us lecture at Reading University. He made a valuable contribution to our Diffusion of Innovation in Low Income Countries (DILIC) study as a research officer here at TMCD.

TMCD Upcoming Events

          20th – 21st August in Toronto, Canada           7th – 8th September in Shanghai, China           15th – 16th October in Oxford, UK           2nd November in London, UK       
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