July 12, 2010
IBM’s R&D Investment in China Debunks Claim that R&D Will Stay in U.S.
A recent announcement that IBM will invest $40 million in an"energy and utilities solutions lab" is further evidence that China's large-scale investments in clean tech are attracting private investment in R&D, not just manufacturing.
This latest news from IBM will be difficult for pundits like Thomas Friedman and Brad Plumer to ignore. Friedman and Plumer have argued that the U.S. will be able to maintain its competitive edge in innovation even as clean tech manufacturing relocates overseas.
IBM is not the first, nor is it likely to be the last to set-up a clean-tech R&D center in China. Dow Chemical opened one last June and a few months later Applied Materials follow suit, opening an advanced solar R&D center in Xi'an.
As Breakthrough's Devon Swezey argued in, "It's Not All Good: Why You Should Worry About the Clean Energy Race," this attitude flows more from reflexive neoliberalism than an understanding of economic history or current events. Swezey noted:
"Among the reasons cited by Applied Materials for the relocation to China was that China, not the U.S., "will be the biggest solar market in the world."
According to Business Spectator, IBM's Brad Gammons, vice president of the Global Energy and Utilities Industry, saw similar potential for smart grid after the Chinese government promised $7 billion for the development of such energy intelligent technology.
IBM's announcement shows that without a national strategy for clean tech competitiveness that includes large-scale public investment in both innovation and manufacturing, America's once dominant lead in energy innovation won't necessarily carry over into the future.