The Emerging Chinese Advanced Technology Superstate

by Ernest H. Preeg

U.S. bilateral trade with China in “advanced technology products” has shifted from balanced trade in 1998 to a U.S. deficit of $36 billion in 2004. One major explanation for this deterioration lies in an understanding of the growth of China as an advanced technology competitor. This new book presents a detailed, current assessment of the rapid development of Chinese advanced technology investment, production, and trade. Chinese research and development (R&D) growth of more than 20 percent per year and a tripling of university graduates since 1995 are the key domestic resource commitments, while foreign direct investment has been the “decisive catalyst” for a doubling of Chinese global exports from 2001 to 2004. The book outlines a constructive and comprehensive U.S. policy response needed to maintain long-standing U.S. leadership in advanced technology innovation, production, and exports. Recommendations are offered in the fields of international finance, most importantly with respect to Chinese “currency manipulation”; international trade and investment, principally to achieve Chinese compliance with World Trade Organization obligations and an Asia-Pacific free trade agreement; and domestic economic policy in a number of specific areas, including education, public sector R&D, tax policy, and tort reform.

237 pages, Paperback

First published January 1, 2005