China's R&D investment grows despite slower funding, US tops global list

Despite a slowing economy, China’s investment in research and development (R&D) continues to go up. With steady growth in funding and a rising share of global research output, China is narrowing the gap with the US in the race for scientific supremacy.

 

China’s growth in research and development (R&D) funding decelerated for the third consecutive year amid an uneven economic recovery, according to a report by the South China Morning Post. However, the country maintained a steady increase in investment intensity as it pursued technological self-reliance.

 

China’s R&D intensity, which measures expenditure as a percentage of GDP and serves as a benchmark for innovation capability and competitiveness, remained stable at 2.68 per cent in 2024.

 

China loses gap in R&D investment intensity with US 

Citing preliminary data from the National Bureau of Statistics, the South China Morning Post report mentioned that R&D funding exceeded 3.6 trillion yuan (approximately $496 billion) in 2024, reflecting an 8.3 per cent increase compared to the previous year.

 

Recent years have seen China focus on advancing original innovations and conducting groundbreaking research to achieve technological independence, sustain economic growth, and strengthen its position in its rivalry with the US.

 

In 2021, China’s R&D expenditure saw a 14.6 per cent rise from the prior year. However, the pace of growth moderated to 10.1 per cent and 8.4 per cent in 2022 and 2023, respectively, due to post-pandemic economic challenges. In contrast, the growth in R&D investment intensity has been consistent, rising from 2.38 per cent in 2021 to 2.49 per cent in 2022 and 2.58 per cent in 2023.

 

US continues to dominate R&D investment intensity 

Meanwhile, the US National Science Board reported that R&D investment intensity in the United States has consistently remained above 3 per cent annually since 2019, peaking at 3.4 per cent in 2022. The report added that the US retains the top position in global R&D expenditure.

 

The American Association for the Advancement of Science highlighted in its April report that the US accounted for 32 per cent of global R&D expenditure in 2021, while China contributed 27 per cent. However, the same year saw China surpass the US in research publication output, a trend also reflected in international patent filings, where China has led since 2015.

 

While the US remains dominant in the proportion of highly cited researchers, its research publication rate declined in 2022 for the first time in decades. The National Science Board noted that between 2003 and 2022, the annual output of science and engineering articles grew by roughly one-third in the US but expanded tenfold in China.

 

China leads in peer-reviewed publications 

A report from March stated that six countries accounted for over half of the world’s peer-reviewed science and engineering publications in 2022. China led with 27 per cent of these publications, followed by the US with 14 per cent. India contributed 6 per cent, while Germany, the UK, and Japan each accounted for 3 per cent.

 

According to the Nature Index database, China overtook the US in 2023 to lead in research output across the 145 high-quality journals it monitors. China’s contributions to peer-reviewed, high-quality research papers rose by 13.6 per cent that year, whereas US contributions dropped by 7.1 per cent, placing it second.

 

The Nature Index 2024 Research Leaders data revealed that seven of the world’s top 10 research institutions in natural and health sciences in 2023 were located in China, compared to just one in 2015. The index observed that the growing ability of Chinese research institutions to produce high-quality science is evident in their increasing global prominence, as institutions outside China struggle to retain their rankings.