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Beyond “China Copy”?

China patents grow
Chinese do more than copy
More innovation

“Chinese copy” is a phrase that can be found in Merriam-Webster’s dictionary. The definition: “an exact imitation or duplicate that includes defects as well as desired qualities.” For years, China had a reputation for slavishly copying the West. “Made in China” meant a cheap copy. China’s reputation has improved a little in recent years as leading manufacturers such as Apple have moved production there. But China is still known for making things, not for inventing things.

The Chinese government has been trying to change that. It has been encouraging “home grown” intellectual property, and has provided incentives to individuals and companies to seek patents. China is now the hottest market in the world for growth in patents: patents approved by China’s State Intellectual Property Office in 2012 jumped 31% from the year before to a very impressive 1.26 million patents.

The number is not quite as impressive as it sounds: more than 4/5 of the patents were design or what China calls “utility model” patents, which do not necessarily represent technological innovation. The number of “invention patents” granted in China last year was 217,000, which is still a very respectable number. By comparison, the US Patent and Trademark Office granted 253,155 utility (“invention”) patents in 2012, and the European Patent Office only granted 65,700 patents. But what’s impressive in China is the growth rate: invention patents were up 26% in 2012, double the growth rate in the US (13%). It is likely that within a few years China will be granting more invention patents than the US.

The increase reflects several trends happening in China. First, as mentioned above, the Chinese government has made innovation a priority, and is directing funds accordingly. However many of the patents filed in China are filed by foreign companies. The increase in foreign companies filing patents in China is driven by two things: 1) the increasing importance of China as a market, especially for technology products, as the Chinese middle class grows; and 2) China’s increasingly positive attitude toward protecting intellectual property.

The growth in Chinese patents is a reflection of China’s maturing as a global economic power – befitting what is now the world’s second largest economy after the United States.

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