The United States has accused China of using foreign ownership restrictions to require or pressure technology transfers from US companies to Chinese entities.
But in reality, the “forced technology transfers of China” claim is fake news.
No ‘forced technology transfer’ in China
According to a statement from China’s Ministry of Commerce, China has never had a policy of forcing technology transfers from foreign companies. It has never signed an agreement on “forced technology transfers,” nor received any complaint from foreign companies, and never regarded the “transfer of technology” as a condition of doing business.
Technology transfers between China-US companies do happen, of course, but are normal business practice — part of mutually voluntary and beneficial cooperation.
Mutually voluntary and beneficial cooperation
“We worked together. Of course we shared people, we shared systems, we shared solutions, we shared strategies. It was nothing forced about that. We wanted to build a successful business. That’s what joint ventures are all about,” said US economist Stephen Roach.
In many cases, the US is the main beneficiary. And foreign firms continue to flock to China.
The US electric vehicle industry leader Tesla will build a super factory in Shanghai with a production capacity of 500,000 vehicles a year, making it the largest foreign investment manufacturing project in the municipality. The oil giant BP recently announced that it will add 1,000 gas stations in China in the next five years.
China’s independent innovation
China’s progress in science and technology is primarily accomplished through independent innovation.
Recent examples of world-leading Chinese innovation include the successful launch of the Tiangong-2 space lab, the commissioning of the deep-sea manned submersible Jiaolong, and the test flight of the airliner C919.
DJI, a Chinese manufacturer of unmanned aerial vehicles with mounted cameras, is the world’s largest consumer drone maker. It holds a global market share of 70 percent, and offers a window into China’s competitiveness in innovative industries.
China’s respect for technology transfers
China has great respect for the transfer of technology from foreign companies, is aware of gaps in its innovation fabric, and meets its obligations.
According to China’s former vice-minister of Commerce Wei Jianguo, Chinese consumers pay a five percent technology transfer fee for each smartphone purchased. In 2017 alone, China paid a total number of $37.6 billion in technology transfer fees across all sectors.