Abstract
China has been drastically reforming its science and technology policy since a decision of the Communist Party in 1985 : a national research fund with a competitive grant system was created, regulations on R&D and technology transfer institutions were lifted, and personnel policy in universities and public research institutes were rendered more flexible. A "Torch Program" launched by the government in 1988 prompted the rapid growth of the Chinese high-tech industry. The "High-Tech Parks" and "Incubators" established in the framework of the program have resulted in more than 20,000 firms employing more than 2 million workers, with a total sales of over 900 billion yuan and a total export of more than $18 million. Networking of R&D organizations is a target of the "Knowledge Innovation Project" launched by the China Academy in 1998. Returnees from the West are playing a very important role in these new trends. It is reported that more than 7,000 Chinese who had been working abroad returned to their native country in the last year. Some Western companies and research organizations have been creating local centers in China. Japan will find lessons to learn from these developments for its own reform in the innovation system.
