Technology puts China at the top of the global innovation pyramid

November 22, 2021

2019 was a remarkable year for global technological development and economic competitiveness. China filed 1.4 million patent applications, accounting for 43.4% of all applications filed in the world, according to the World Intellectual Property Organization (WIPO).

As for the United States, once the world’s leader in patent applications, the loss of the position has profound implications on two levels: first, the international economic competition is getting more intense; second, China is strengthening its position in the field of innovation.

The developments in the past two decades have shown that China has become a country that innovates, manufactures and competes proactively. Chinese leadership considers science and technology to be the backbone of the country’s economic development, and the key to increasing international presence and soft power.

Based on the latest figures, while patent applications filed globally with the European Patent Office (EPO) in 2020 decreased by 0.7 percent compared to 2019, the number of patent applications filed from China increased to 13,432, with a year-on-year growth of 9.9%. This is particularly exceptional in 2020, a year where COVID-19 caused several countries around the world including China, to go into lockdown.

Recently WIPO clarified that China, for the second year in a row, was the largest source of international patent applications in the world in 2020. According to the organization's figures, China achieved an increase in the number of patent applications by 16.1% year-on-year, compared with a 3% increase for the US, and Huawei filed the largest number of patents last year for the fourth consecutive year. Daren Tang, the Director-General of WIPO, said that the continuous rise in the number of patent applications from Asian countries will be part of a long-term trend.

Research and development: Huawei shines

Huawei ranked fifth on the 2019 EU Industrial R&D Investment Scoreboard in terms of R&D investment. This figure was arrived at after aggregating and analyzing data from annual reports and accounts of 2,500 companies investing the largest sums in R&D in the world.

Due to a long history of sustained investment in R&D, Huawei has been able to handle current challenges and difficulties and strengthen its global leadership in ICT despite the US government's pressure on it. Huawei has continued to provide its advanced innovations, especially in the field of artificial intelligence and computing, and has pioneered the development of 5G technology worldwide.

Huawei has bolstered its 5G business with investments of $4 billion since 2009, which is more than the combined investments in 5G by major companies in the US and Europe. Huawei began its 5G research and development in 2009, and has submitted a total of 23,600 proposals to the 3GPP for basic 5G research. Recently, Huawei released a report at a forum on protecting intellectual property rights and supporting innovation, stating that through its continuous investment in research, development and innovation, Huawei has become one of the world's largest patent holders, holding more than 40,000 groups of valid patents worldwide with a combined total of over 100,000 patents by the end of 2020.

Patent creates wealth

As a result of its continuous investment and progress, Huawei owns about 3,367 patents in the field of 5G, accounting for more than 20 percent of the total patents in this field, and ranks first among all ICT companies. It has established nine R&D centers for 5G standards around the world, with more than 500 experts working on standards development. The company also participates in over 100 organizations concerned with setting international standards, which has contributed to the signing of dozens of contracts for 5G projects worldwide, including in the Middle East and North Africa.

Jason Ding, Huawei’s head of intellectual property, said due to Huawei’s innovation achievements, patent licensing could bring Huawei $1.2 billion to $1.3 billion in revenue between 2019 and 2021. It is worth noting that despite US sanctions against China’s 5G development, US companies will still have to pay Chinese companies for the use of their patented technology. In fact, Huawei has already started demanding royalties from companies such as Apple for the use of 5G wireless technology patents, creating a sustainable source of profit for Huawei.

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