Professor Xiaolan Fu recently testified to the US-China Economic and Security Review Commission, a body established by the US Congress, on the impact of China's five-year plans on strategic industries

Professor Fu's testimony spanned a wide range of issues, from describing the Chinese government's technology and innovation policy, to different firms' efforts to upgrade their knowledge capabilities and the impact of China's five-year plans on innovation.

She noted that the 12th and 13th Five Year Plans will together have a significant impact on innovation in China, especially on the development of strategic industries identified in the plans.

She also testified on the impact China's industrial transformation would have on the American economy, noting that it will not be long before China catches up with the US in innovation capacity. While US businesses might face increased competition, they will also benefit from the expanded pool of global knowledge as China rapidly increases its investment in R&D

"US businesses should be confident about the dynamism and competitiveness of the US innovation system and the US economy", she said. At the same time, "the US should collaborate more with China on innovation. [...] The collaborations between the US and China on innovation policy need not be limited to collaborative research; the collaboration can expand to wider areas along the innovation chain and in the innovation system".

With regard to Chinese firms' "go out" strategy, Professor Fu noted that this appeared to be driven largely by firms' own strategic choices rather than a political decision by the government. However, the number of objections received by Chinese MNEs was greater than the objections to MNEs from other major emerging economies. Some discrimination might exist against Chinese MNEs, she said, especially Chinese SOE MNEs and Chinese MNEs in the high-technology sector.