May 16, 2008    Volume 15, No. 9

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No 'Sputnik' Moment To Reassess U.S. Capabilities:
China Overtakes United States In Georgia Tech's Global High-Tech Competitiveness Index



By Richard McCormack
richard@manufacturingnews.com

China has surpassed the United States in a key measure of high tech competitiveness. The Georgia Institute of Technology's bi-annual "High-Tech Indicators" finds that China improved its "technological standing" by 9 points over the period of 2005 to 2007, with the United States and Japan suffering declines of 6.8 and 7.1 respectively. In Georgia Tech's scale of one to 100, China's technological standing now rests at 82.8, compared to the U.S. at 76.1. The United States peaked at 95.4 in 1999. China has increased from 22.5 in 1996 to 82.8 in 2007.

"The message speaks out pretty loudly," says Alan Porter, co-director of Georgia Tech's Technology Policy and Assessment Center, which produces the benchmark. "I think the prospects are pretty scary."

The Georgia Tech center has been measuring high-tech competitiveness of 33 nations for the past 20 years. It has watched as China has zoomed up to the leading global position in technology. But other nations are showing gains as well including South Korea, Singapore, Taiwan, Brazil, India and Chile. "If the increasingly integrated European Union were considered one entity instead of 27 separate countries, it would surpass the United States," says the Georgia Tech indicator report.

Researchers and technologists in developing countries all have access to the latest computing and networking technologies. They are engaged in leading-edge research and know where that research is taking place globally. "So what is our big advantage?' Porter asks.

The Georgia Tech "High-Tech Indicator" does not measure how active countries are in research, "but in areas like nanotechnology, China now leads the United States in published articles, but what scares me is China is getting better at marrying that research to their low-cost productive processes," says Porter. "When you put those together with our buzzword of innovation, China is big, they're tough and cheap. Again, where is our edge?"

Adds Nils Newman, a Georgia Tech co-author of the indicator study: "We have a situation in which technology products are going to be appearing in the marketplace that were not developed or commercialized here. We won't have had any involvement in them and may not even know they are coming."

The surge of China past the United States as the global technology powerhouse should be a "Sputnik" moment, but it isn't proving to be. For the most part, federal officials and politicians have been silent. As the economy heads into a downturn, both political parties "are jumping all over each other for the instant fix -- the tax rebate," Porter observes. " 'Problem is all solved. Congratulations!' Wow. I think long term there are things that are not amenable to that solution."

The High-Tech Indicator tells a consistent story over the past 15 years of China's authoritarian government setting its mind on achieving global technology and industrial dominance. "China's entire orientation is toward competing," says Porter. "We frown on planning and don't do much, but they have set their mind on it."

China's gains have been dramatic. The country has not stumbled once in 15 years. "There is no real sense that any kind of leveling off is occurring," says Newman. "Most industrialized countries reach a kind of equilibrium, but the study shows no interruptions in China's advance."

China is training more scientists and engineers and is generously funding their research endeavors. The United States is headed in the opposite direction. "The training of scientists and engineers has lagged, and post 9-11 immigration barriers have kept out international scholars who could help fill the gap," says the Georgia Tech indicator study.

The Georgia Tech "technology standing" measure of 33 countries is based upon four factors: national orientation toward technological competitiveness, socioeconomic infrastructure, technological infrastructure and productive capacity. Each of the indicators is based on a combination of statistical data and expert opinions.

China's ascendancy over 33 nations has "changed the world economic landscape in technology," says Porter. Its continued growth and dominance "won't leave much room for other countries."

Adds Newman: "It's like being 40 years old and playing basketball against a competitor who's only 12 years old -- but is already at your height. You are a little better right now and have more experience, but you're not going to squeeze much more performance out. The future clearly doesn't look good for the United States."

The study is located at http://tpac.gatech.edu/.



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