China's R&D spending falls in US dollar terms for 1st time in 13 years

The drop was due to a weaker yuan and tighter credit. But in yuan terms R&D spending add 8 percent

China’s annual private sector investment in research and development in US dollar terms fell for the first time in 13 years, hurt by a weaker yuan and tight credit policies, according to a new report.

China’s largest listed companies spent a combined US$45.2 billion on R&D over the past year, down 3.3 percent year on year, said the report covering the world’s 1,000 largest listed firms released this week by PwC consultancy Strategy&.

Strategy& attributed the fall in R&D to the weaker yuan last year and tight credit policies impacting investment in the industrial sector, which spends more on R&D than any other sector in the country.

But in yuan terms, R&D spending rose 8 percent year on year, but it was down from double-digit growth shown in last year’s report.

Globally, R&D investment by the 1,000 largest listed companies rose 3 percent year on year to exceed US$700 billion for the first time.

For the first time, a Chinese company — Alibaba — made the global Top 10 Most Innovative Companies list with annual R&D investment of US$2.5 billion.

Strategy& excluded Huawei from the list due to its status as a non-public company. Huawei is the biggest spender in China and the 8th largest in the world, with US$11 billion.

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