30
Fuels & Lubes International Quarter Two 2016
Lost in the tales of woe brought
forth by the crash of oil and natural
gas prices is the story of how the
market leadership for research and
development (R&D) has shifted from
Europe and North America to China,
South Korea and other Asian nations.
There are many reasons for this,
some inevitable, some induced by
the market and others from the "law
of unintended consequences." No
matter why, the end result is that ex-
penditures from South Korea, China,
and others on overall R&D is rising.
South Korea spends more than 4% of
its gross domestic product on R&D,
while the U.S. only spends 2.7%.
China spends just over 2%, while the
European Union spends only 1.94%.
The trends in R&D spending tell an
even greater saga of a shift in product
innovation.
Even though it commenced nearly
a decade ago, the impact of The Great
Recession is still being felt on R&D
spending. While economic growth
declined in the European Union and
the United States during The Great
Recession, Asian economies rose.
This was especially true in China and
India. And when the economies of
the two most populous nations in the
world, about 40% of those living on
the planet, were growing, so did their
neighbours'.
China is also shifting its economy
away from being export focused to
propitiating domestic consumer
spending. Critical to China’s increas-
R&D: A casualty of spending cuts
BY JONATHAN YATES
研发：节支的代价
