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Protection of Intellectual Property Rights Could Help China Grow its Own Technologies and Domestic Brands

Protection of Intellectual Property Rights Could Help China Grow its Own Technologies and Domestic Brands

This article titled, “Protection of intellectual property rights could help China grow its own technologies and domestic brands” carried in the China Daily emphasizes the importance of IP rights protection in realizing its dream of transforming itself into a creative and innovative nation. How can IPRs help in boosting the growth of domestic brands and self bred technologies?

The realization of China’s dream of developing itself into a creative and innovative nation would largely depend on how well it is being able to enhance the competitiveness of its homebred technologies, the strength of local brands and its cultural prowess. In order to achieve the same, it would need to strengthen its mechanisms engaged in protecting intellectual properties and innovations. The phenomenal success it has achieved in its manufacturing sector should be perceived with much more calmness.

Although China topped the list of countries in terms of manufacturing volumes in 2010, it does not transform the country into a global manufacturing giant. Despite the relentless expansion of the manufacturing scale in the years gone by, the productivity levels registered in the manufacturing sector is pretty low. The Chinese manufacturing phenomena lies in the low and middle end of the manufacturing chain, globally. Therefore, the value added by a single member of the labor force is only $1,790 per person! Japan registers an addition that is six and a half times higher, whereas in the America, it is 10.2 times above the given value.

In order to improve this position, China should be making calculated efforts in accelerating industrial restructuring, developing new industries and enforcing a fresh new patent system. Therefore, not only should the volume of patent filing rise, the quality and efficacy utilization quotient of the patents should also be taken care of. This would be especially applicable for core patent technologies. This would warrant effective measures to increase the proportion of China’s inputs towards scientific research in the Gross Domestic Product. It was registered as 1.7% in 2010, which is marginally higher than the average of 1.6. An almost 2% proportion is registered in countries that exhibit unflinching focus towards innovations. In fact Korea boasts of proportions as high as 3.1%.

The effort to enhance the proportion of research input to GDP should be backed by conversion of technological and scientific research into practical applications. Currently, about one fourth of the research activities have been utilized for industrial purposes in China. This much lower than the market average of 60% and 80%, registered in most developed nations. It should also try to enhance the contributions from technological and scientific innovations towards GDP growth. Developed countries are becoming more and more dependent on technological progress for ensuring promising growth.

In today’s world, the main basis of competition among nations is soft power. This is a new concept inclusive of cultural influence, national cohesion and the positives of the social system. The soft power can be boosted by encouraging the competitiveness and innovativeness of the cultural sector. In order to boost the cultural influence, a strong copyright system is mandatory for facilitating and realizing these goals. This is a common phenomenon in countries that have an active cultural industry.

The number of IP imports into China is far higher than the exports. This means that the country needs to take some concrete steps to develop a strong IP base of its own. At the same time, it should increase the number of cultural products in the world markets so that the dominance of the West on the international cultural platform can be diminished. As of date, the US has dominance in about 43% of the markets and Europe accounts for 34%. South and Asian countries only have about 19%. Of this 19%, Korea accounts of 3.5% and Japan has 10%. The growth of domestic IP should also be enhanced through effective measures so that its contribution to the GDP can be increased.

The development of IPs in China has been slow as compared to other countries. It barely contributes a 6.7% to the GDP, which is also not acceptable. Japan records 20%, European Countries 15% and American IPs a 25% contribution.

At the same time, China needs to emphasize the influence of the local brands in the global markets and alter its image as cheap processing workshop.

Note: The preceding is a summary of an article found though our research. It is provided here with editorial comment for members only. See the full article here –

The New Asia Innovation Team