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S&T reforms 

Since at least 1978, China has encouraged experimentation in its science and technology (S&T) system as a means of arriving at reforms and has periodically summarized the main directions of reform in authoritative decisions of the State Council and of the Central Committee of the Communist Party of China (CPC), particularly the March 1985 Decision on the Reform of the Science and Technology Management System (Box 1) and the May 1995 Decision on Accelerating Scientific and Technological Progress (see Box 2). This has been a creative method of approaching a complex set of issues, and the main decisions have established a sensible overall framework for S&T policy for a modernizing economy. In some cases, such as in environmental policy, the decisions already taken in China are ahead of those taken in most other countries in the world.

Box 1

The Decision on the Reform of the Science and Technology Management System (March 1985)   Modern science and technology constitute the most dynamic and decisive factors in the new productive forces .... We should reform China's science and technology management system resolutely and step by step in accordance with the strategic principle that our economic construction rely on science and technology and that our scientific and technological work must be oriented to economic construction.... Regarding the operating mechanism, it entails reforming the funding system, exploiting the technology market and overcoming the defects of relying on purely administrative means in science and technology management, with the state undertaking too much and exercising too rigid a control.  Funding for research institutes should be reformed so as to practise classified management over the operating expenses which is suited to different types of scientific and technological activities. [This led to different state-funding responsibilities for different kinds of S&T activities and institutions.]  We should promote the commercialization of technological achievements and exploit the technology market so as to suit the needs of the socialist commodity economy.  In restructuring the science and technology system, emphasis should be placed on encouraging partnership between research, educational and designing institutions on the one hand and production units on the other and on strengthening the enterprises' capability for technology absorption and development.  The management system in agricultural science and technology should be reformed so as to serve the restructuring of the rural economy and facilitate its conversion to specialization, commercialization and modernization.  To ensure sustained progress in economic and scientific and technological development, it is necessary to deploy our scientific research forces rationally and in depth.  More decision-making power should be granted to research institutes, and macromanagement of scientific and technological work by government organs should be improved.  Opening to the outside world and establishing contact with other countries is a basic and long-term policy in China's scientific and technological development.  Management of scientific and technological personnel should be reformed to create a situation favourable to the emergence of large numbers of talented people who can put their specialized knowledge to best use.  Source: SSTC (1986)

Box 2

The Decision on Accelerating Scientific and Technological Progress (6 May 1995)  The Decision on Accelerating Scientific and Technological Progress (see National Affairs 1995) is based on 11 major points, some of which are supplemented by a series of principles. The major points are the following:   Implementing the idea that Science and Technology are primary productive forces in all fields;  Energetically push forward scientific and technological progress in agriculture and rural areas;  Improve the quality and efficiency of industrial growth through advances in science and technology;  Develop high-technology and its industries;  Promote scientific and technological progress in social development;  Firmly tighten basic research;  Continue to restructure science and technology management and establish a new system of science and technology management, compatible with the socialist market economic system and the law of scientific and technological development.  Train a contingent of highly qualified scientific and technical workers and enhance the whole nation's scientific and technological level;  Increase science and technology inputs through various channels and at different levels;  Further opening up China to the outside world and extensively launching international scientific and technological cooperation and exchanges;  Effectively strengthening Party and Government leadership over scientific and technological work.

The 1993 Decision on Issues Concerning the Establishment of a Socialist Market Economy Structure appears to have injected added impetus to S&T reforms in some parts of China and has given rise to another round of creative experimentation. 

We have taken the March 1985 Decision as our main point of departure and have also considered the effects of other reform initiatives indicated in the time line shown in Figure 1.

The problems of implementation 

Although the Mission believes that the broad directions of reform set out in the State Council's decisions are appropriate to China's overall development, we have observed that there have been great variations in the level of implementation of reforms in different parts of the country and in different institutions. Not surprisingly, in the eyes of the Mission, there is a strong correlation between successful and innovative attempts at reform and the presence of strong entrepreneurial management. Equally, where management retains the mind-set of the command economy, reform has been slow. 

The overall process of reform in China 

The reform of China's S&T system is only one element of an ongoing and long-term process of reform of its national economy and social-welfare system. China is emerging from a command economy that has produced, contrary to its intentions, a huge and, to the outsider, confusing array of institutions in all sectors that are almost invariably overstaffed and often duplicate the work done by others. There is a need to continue the process of rationalization that began with the reduction of government support to many of these institutions. However, this process is substantially impeded by the significant overhead costs that institutions incur in providing housing, health care, education, and other services to their employees, both current and retired, and to their families. Key to tackling these important barriers to institutional reform will be the as-yet incomplete process of reform of the social-welfare system. Until a new system, geared to the demands of the emerging socialist market economy, is in place, many necessary structural changes, including changes in the S&T system, will not be possible. 

International factors impinging on 
China's reform process 

When China decided to develop its "open-door policy" in the late 1970s, one of the main reasons was to acquire access to foreign technology and foreign management methods. It was expected that these acquisitions would boost the Chinese economy and bring improved living conditions to the Chinese people. It was also expected that encouraging Chinese scientists to study and work abroad would lead to an inflow into China of foreign knowledge, technologies, and organizational and management practices. All of this has happened, and on a scale scarcely imaginable 15 years ago. 

During these 15 years, not only has China changed, but so too has the rest of the world. These changes have led to increased globalization, not only of economies, but also of S&T. International collaboration in science is increasingly the way in which science is practiced, and the cost of doing research has meant that international collaboration is also necessary for sharing costs. Technological collaboration within business cooperative arrangements is also becoming more global. Multinational corporations frequently do their research in a first country, their design in a second, their development and production in a third, and their initial sales in a fourth. Unless a country has technological assets that enable it to be an attractive partner in this globalization, it will become increasingly isolated. 

China clearly has many S&T assets; it has embraced its open-door policy; and it has paid attention to the encouragement of international collaboration. Nevertheless, the Mission formed the impression that there is not an explicit policy in China for international collaboration in S&T that fully embraces the implications of today's global realities in technological development. Given the subject's importance, China could consider convening a small international conference on national strategies for international collaboration in S&T. This would be a way of learning about other international experience on an issue of major significance for China. 

The lack of clarity -- even ambiguity -- 
in some policy pronouncements 

We discuss briefly in Chapter 6 the use of eight-character slogans to convey the essence of policies -- a practice whose result is to allow considerable freedom for interpretation to those decision-makers who are willing to be entrepreneurial and innovative. One such slogan, wenzhu yitou, fangkai yipian, informally translated by the Mission as "anchor one end securely, let the other roam free," is just one example of a policy statement that is subject to many interpretations. 

The Mission recognizes that these phrases are designed to express in a concise fashion the essence of the longer policy statements that they accompany. Additionally, these phrases can be seen as setting boundary conditions within which a good deal of experimentation can take place. This stimulation of local experiments has, in fact, been one of the strengths of the Chinese approach to reform. 

Document(s) 4 of 17