Investing in Hi-Tech Industries in China: Pros and Cons

4017 WordsOct 24, 200817 Pages
1.0 Introduction China introduced market reforms in the early 1980s; only a third of the economy is now directly state-controlled. Since joining the World Trade Organization in 2001, China has rapidly become an economic force, doubling its share of global manufacturing output and creating a commodity-market boom. In 2004 China became the largest exporter of information and communication technology (ICT) exports. In China, the Hi-tech industry, that includes software industry is a recent phenomenon and the early industry participants were government-funded research institutions spin-offs Legend and Founder were setting up their operations in the year of 1980. China’s market-oriented economy reforms has largely encouraged a large…show more content…
Their priority now is not to attract as much foreign investment as possible, but to bring in new high-tech industries that they currently don’t have. Besides that, Jin Bosheng, a research analyst with the Ministry of Commerce, said the government was showing particular interest in new high-tech industries, especially electronics, biology, petrochemicals and medicines, which indicated it was seeking to redirect foreign investment. In 27 September 2007, a senior official said China welcomed more overseas investment to develop the country’s hi-tech industry. According to Zhang Xiaoqiang, vice minister of the National Development and Reform Commission said that China welcomed more international hi-tech companies to set up regional headquarters, R&D centers, procurement centers and training centers in China, and encourages domestics enterprises to explore overseas hi-tech markets. As one of the world’s largest hi-tech industry and largest hi-tech exporter, China produces more computers, mobile phones, antibiotics and vaccines than any other countries worldwide. In 2006, the total revenue of the hi-tech industry exceeded 5.3 trillion Yuan (706 billion US dollars), with its added-value contributing 8 percent of GDP growth. Hi-tech export stood at 281.5 billion dollars in 2006, more than four times of that in 2002, almost a third of China’s total exports volume. Besides that, China also plan to focus on nine major special projects

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