Globalization of R&D can be illustrated by multinational corporations, which are decentralizing their R&D organizations across advanced and emerging economies. This strategy optimizes the balance of cost and capability access and provides synergy with commercial development of a wider range of local markets.
For 2011, global spending on R&D is anticipated to increase 3.6%, to almost $1.2 trillion. With Asia’s stake continuing to increase, the geographic distribution of this investment will continue a shift begun more than five years ago. The U.S., however, still dominates absolute spending at a level well above its share of global GDP.
Globalization of R&D is slowly altering the dominance that the U.S. has maintained for the past 40 years. The economies of China, Korea, India, Russia and Brazil, and their investments in R&D, are expanding at rates substantially higher than that of the U.S., Japan, and Germany. As a result, emerging economies are starting to challenge the technological and discovery capabilities of the historic R&D leaders
China’s R&D investments are growing at a rate that closely matches its 9% to 10% annual economic growth (and about four times that currently of the U.S. in both categories). But in absolute dollars, the growth is roughly the same as that of the U.S.—about $10 billion per year.
In the EU the average for R&D spending as a share of GDP has remained at 1.9% for five years. Surprisingly, even before the global recession took hold, there was a lack of governmental action to attempt to reach the “3% by 2010” goal. Coming into 2011, there has been no apparent interest in updating or revitalizing this goal.
Source: 2011 R&D Global Funding Forecast
- 463 Views