issue 1 - Roland Berger

p food for thought
china – high-tech center
High tech and electric lights
China is developing into a leader in high technology on the back of massive state support.
High levels of investment are aimed at creating globally important industry and research centers.
In rural areas, by contrast, electric lighting is still seen as cutting-edge.
To global leadership in 50 years
From the 18th to the beginning of the 20th century, self-chosen isolation, conflicts with Asian neighbors and colonial powers, and a series of civil wars led to China’s technological and
economic collapse. Beginning in 1949, four phases have shaped China’s return to global economic importance.
Phase 1 Phase 2 Phase 3 Phase 4
1949 – 1965
Mao Zedong: Adoption of the Soviet scientific and
technological model along with a centrally planned
economy; in 1950, signing of the Chinese-Soviet
treaty of friendship and mutual assistance.
Source: Kathleen Walsh, “Foreign High-Tech R&D in China,” 2003
1966 – 1976
Mao’s Cultural Revolution,
closure of universities,
persecution of intellectuals
and scientists.
182,000
patents were filed by Chinese state research
institutes in 2003. That is roughly 30,000 more
than in the states of the European Union.
1977 – 1997
Reforms under Deng Xiaoping; in 1979,
US-China Science & Technology
Agreement; import of science, technology
and know-how from the US and Europe.
1997 – present
Concentration on high-tech
industries; gradual turn away
from economic model based
solely on cheap production.
Vast market for mobile telecommunications
In just one year, roughly 71 million Chinese signed new contracts for mobile
phones, more than double the population of Canada. A total of 315 million mobile
phones make China the largest market in the world. Roland Berger Strategy
Consultants predicts an additional 35 percent increase in the market in 2005.
325
315.1
Backlog in the population
Outside of China’s larger cities, light bulbs are still a sign of wealth and progress. The number
of lamps and light fittings per households is rising throughout China. But for reasons of
thrift, an average of only three are ever turned on.
300
275
Number of new
mobile phone
contracts,
in millions
*Average number of light bulbs
per household
19
250
244.1
6.5
8.5
225
China
1995*
Source: Horizon Group, 2004
China
2003
USA/Western Europe
2003
200
Aug Sept Oct Nov Jan Feb Mar Apr May June July Aug
2003 2004
Source: National Bureau of Statistics of China, Ministry of Information Industry of China;
“Outwardly Mobile in China,” Roland Berger Strategy Consultants
6
think: act