EU ST Counselors Meeting Dec 8 2008 Beijing

EU S&T Counselors Meeting Dec. 8, 2008 Beijing National High-tech Industry Development Zones Qian Jinqiu Torch High-Tech Industry Development Center, Ministry of Science & Technology

Outline u u u Background Milestones Current Status Achievements Future Strategy

Background: Torch Program n Birth: August 1988 n Nature: A national guideline program n Aim: To promote the n ü commercialization of high-tech achievements, the ü industrialization of high-tech products and the ü internationalization of high-tech industries Executive Agency: Torch High-Tech Industry Development Center

Background: Torch Program n Missions n Policy Support n National High-tech Industry Development Zones n High-Tech Innovation Service Center (Incubators) n. Torch Program Projects n. Torch Program Software Parks n. Torch Program Specialized Industrial Bases n Innovation Fund for Technology-based SMEs n Internationalization n Training High-Tech Industrialization & Environment Building

Milestones n 1985, Shenzhen Science and Technology Industrial park set up jointly by CAS and Shenzhen Municipal Government n 1988, Beijing New Technology Industry Experimental Zone was approved by State Council with 18 preferential policies. n 1991, the State Council approved in March to set up National High-Tech Industry Development Zones and promulgated related preferential policies; 26 zones approved to be established n 1992, another 25 zones approved n 1997, Yangling Agricultural High-tech Industry Demonstration Zone approved n 2005, Premier Wen Jiabao put forward the “Four-in-one“ positioning as the development goal for national high-tech zones n 2007, Ningbo high-tech Park was approved as the 54 th national high-tech zone

Current Status n Geographic Layout ü 29 zones located in central cities with intensive intellect and good industrial base ü 13 zones located in coastal cities with good opening-up conditions ü 12 zones located in traditional industrial cities with intensive military enterprises

Current Status n Administration Scheme Ministry of Science & Technology: overall management & operational guidance ü Provincial S&T Commission: high-tech enterprise identification ü Local government of host city: immediate leader & supervisor, policy and financial support ü The Administrative Committee : Ø Administrative body authorized or delegated by local government Ø Independent fiscal system and policy-makers Ø Environment building (soft & hard) and economic development Ø Overall design and infrastructure construction； Ø ‘One-stop’ services to tenant companies ü

Current Status n Differences with other zones ü The Special Economic Zones: Ø Ø ü The Economic and Technical Development Zones: Ø Ø ü large comprehensive reform trial zones enjoying legislative power and the special jurisdiction opening windows with preferential policies to attract FDI to boost local economy and promote export investment type-based policy to learn from foreign advanced technology and management experience, The New & High-tech Industry Development Zones: Ø Ø Ø Mainly relying on domestic S&T strength and industrial foundation to optimize Local environment for tech-based business creation and development Developing high-tech industry with independent IPRs, upgrading traditional industries and optimize industrial structure realizing sustainable growth of national economy

Achievements ( I ) n Main drivers for sustainable & strong economic growth average annual growth rate of major economic indices: 44% (1992 -2007) total output value : 1757. 4 billion Yuan, 7. 1% of national GDP (2007’) average industrial output per capita: 710, 000 Yuan, 6. 23 times of national average ü industrial value-added per square kilometer land: 700 million Yuan ü 33 zones contribute more than 20% of local industrial added-value ü ü ü GDP Contribution from National High-tech Zones (2001 -2007)

Zhongguancun Before Zhongguancun Now

Achievements ( II ) n Major bases of technology innovations R＆D expenditure: 134. 88 bn Yuan RMB, 9% of GDP. ü 49, 000 invention patents with 7. 5 pieces held by per 1, 000 people ü Converging areas of R&D institutions & innovation platforms ü ü 278 Universities ü 255 National Engineering Research Centers ü 360 Open Labs ü 251 Industry Technology Testing Platforms ü 102 Technology Transfer Centers ü talent pools of innovation personnel Ø R&D and technological personnel: 1. 2 million (18. 5% of all employees) Including 29, 000 doctors, 216, 000 masters and 280, 000 overseas returned students.

Achievements ( III ) n Important bases for hi-tech industry development ü ü ü 32, 347 hi-tech tenant enterprises which generated 33% of the national hi-tech industrial output 605 listed companies in stock market Higher-end industries develop vigorously Burgeoning Industries continues to emerge Per Capita Economic Indicators of National High-tech Zones RMB (10 k)

Cradle of High-tech Companies From “Made in China” to “Created in China”

Higher-end Industries IC XXX Zhangjiang: International-leading technologies Zhongguancun: 1/3 IC designs in China; products from “Loongson” , “Vimicro“, etc. entered international market Bio-pharm Zhangjiang: 25 international patent applications and 40 National first-grade new medicine applications； Changchun: 40% domestic market share of Hepatitis vaccine and No. 1 Interferon suppository production capacity in China New Materials. Zhengzhou: 60% domestic market share of super-hard materials Changsha: cobat-acid lithium battery material sales ranks 3 rd in the world and 1 st in the country; National first-grade invention award for high performance carbon composites Photovoltaic Xiamen: World leading production base of flat color TV ； Wuhan: 50%, 40% and 50% domestic market of optical fiber cable, optoelectronic devices and laser products respectively

Burgeoning Industries Contract XXX Research Creative Industry Animation Zhongguancun: nearly 1/3 of the country’s biomedicine contract research resources Zhangjiang: the largest and most professional cultural technology creative industry player, producing 70% of total net games output value in the country Changsha: the largest domestic animation-cartoon production base (ranking 10 th in the world), contributing more than 50% of original making output Software Outsourcing Dalian: software engineering capacity covering design, development to testing and maintenance，products with independent IPR have entered international market

Achievements ( IV ) n Model areas of green development average energy consumption per 1, 000 Yuan GDP: 50. 6 kg stand coal, only 40% of national average. ü two thirds zones have been ratified as demonstration areas of ISO 14001 Environment Management System. ü n Experimental districts of public administration reform ü Small-Organization with Extensive Services Ø scale of administrative body : 1/4 of ordinary districts. Ø administrative staff: 1/8 Ø Service-oriented governments Ø “one-stop service” system

Future Strategy 1 ¯Important carriers to promote technology progress and reinforcing indigenous innovation capabilities 2 Strategic Positioning ¯Forelands to take the commending points of high-tech 4 industries ¯Powerful engines to push economic restructuring and growth mode transformation “ 4 in 1” 3 ¯Service platforms to facilitate tech-based companies to compete in international markets

Future Strategy n Strategic Goals n ü Realizing “ 5 changes” ü Endeavoring to make “ 4 advancements” ü Constructing “ 3 types of parks” Endogenous-Developing Approach ü Industry Cluster Development ü Industry Structure Innovation ü Building Harmonious Parks ü International Cooperation

Future Strategy n Realizing “ 5 changes” ü ü ü from land/capital driven to tech/innovation driven from reliance on preferential policy or investment attraction to optimizing innovation/entrepreneurial environment and cultivating endogenic force from all-inclusive industrial development to developing characteristic leading industries based on local conditions from “hard” to “soft” environment building by optimizing configuration of technology resources and providing qualified services. from “introduction from abroad” and domestic market oriented to “integration of bringing in and going out” and developing international market.

Future Strategy n Endeavor to make “ 4 advancements” Significant advancement of indigenous innovation ability ü Remarkable advancement of international competitiveness ü Advancement of sustainable development capacity ü Advancement of radiating and leading effect ü n Constructing “ 3 types of parks” World Class High-tech Parks ü Innovation Parks ü Specialized Parks ü

Future Strategy n Industrial Cluster Development Industrial Base Main Features ü Physical congregation of industrial elements ü Specialized industries Ø To Industrial Cluster ü Close professionalized business co-operation based on value chains ü Industrial centralization Innovation Cluster ü Congregation of higher-end innovation elements including technology, talent, capital & tech-based companies. ü Connection, interaction, competition and co-operation among innovation players ü Strong Innovation ability cultivate and develop innovation clusters based upon various existing industrial bases through the guidance of public policies Ø To speed up the formation and growth of innovation clusters by establishing specialized parks, promoting industry alliances, cultivating innovative industrial sectors and strengthening public utility management

Future Strategy n Industrial Structure Innovation Essential Factors Industrial Growth Discipline（Life Cycle） Growth Birth Formation Technology Intermediaries Demand vs Supply Industrial Structure Business Research Market HR Infrastructure Decline Gov. Knowledge Capital Maturity Universities Discipline Industrial Value Discipline R&D Design Production Brand Distribute Industrial structure innovation may take on various forms relating to the three basic disciplines of hightech industry development

Future Strategy n Building Harmonious Parks Economy Harmony Culture Harmony Requirements on developing Harmonious Park Environment Harmony Society Harmony

Future Strategy n International Cooperation Technology Government Level people Capital Human z. P Park Level Business Level Cooperation Market ……

Torch Center: Missions Strategic Study & Planning Administration Work High-tech Industrialization & Environment Building Project Management Promotion & Services

Torch Center: Strategic Study & Planning Making research on the development conditions and problems regarding the high-tech zones, technology markets, high-tech industrialization etc. and submitting suggestions and proposals to MOST for policy-making n Drawing up proposals on policies and development plans of the Torch Program, the national high-tech parks, technology markets, technology business incubators, high-tech enterprises, etc. n Drafting proposals on investment and financing policy for high-tech industrialization, organizing and promoting technology-oriented venture capital investment. n

Torch Center: Administration Work n n n National High-tech industry Development Zones & Torch Program Industrial Bases Technology Business Incubator Overseas Science Parks Technology Market, Technology Transactions Venture Capital Institutions; High-tech Enterprises

Torch Center: Project Management n n n Torch Program Innovation Fund for Small Technology-based Firms (including Techbased SMEs VC Introductory Fund ) National Key New Products. Productivity Promotion Centers, University Science Parks Software industrialization Compilation of ‘China High-tech Products Catalogue’ & ‘China Hightech Commodities Export Catalogue’, etc.

Torch Center: Promotion & Services n n n n Related Statistical work Coordination and guidance work on the management of technology markets across the country Services on S&T achievements application and Industrialization consultation. Promotional work for high-tech industrialization Information services Personnel training International cooperation

Thank you ! Website: www. ctp. gov. cn E-mail: qianjq@ctp. gov. cn