Will it be able to come up with a new one? Here is a story that Robert O’Brien tells in a recent paper in the journal China Security. In 2005, China’s National Development and Reform Commission, which had the power to set government procurement policies, said that state-owned wind farms could only buy turbines that had 70 percent of their parts made in China.
China, starting around that time, has become a major force in wind power, growing in the last 5 years at a dramatic pace: Chinese producers now control about 85 percent of the Chinese market, and half of the market globally, according to the New York Times, as O’Brien points out.
In 2005, Gamesa, a thirty-five year old Spanish company and one of the world’s largest producers of wind turbines, controlled about a third of the Chinese market. In response to the new rules, Gamesa started teaching local suppliers how to make parts of its turbines. But the suppliers then started to abandon it, and Gamesa’s market share is now a only 3 percent. Up to now, China’s growth has been dramatic enough that no one complains–that 3 percent of today’s market is double what Gamesa was selling in 2005. This bonanza-like atmosphere has given the Chinese government license to act with license.
To read the full, original article click on this link: China's innovation policy is all wrong – Global Public Square - CNN.com Blogs
Author: Konstantin Kakaes
