The Inside Story of China's High-Tech Industry by Zhou Yu;

Author:Zhou, Yu;
Language: eng
Format: epub
ISBN: 1351225
Publisher: Rowman & Littlefield Publishers
Published: 2013-07-11T00:00:00+00:00

DEVELOPMENT OF THE BUSINESS SERVICE SECTOR

Another persistent deficiency of ZGC is its underdeveloped business service sector, including legal, accounting, consulting, and advertising agencies. Thanks to the legacy of the centrally planned economy, business services were virtually nonexistent in ZGC until 1990. During the 1990s, this sector started to emerge, but it was still in its infancy. According to a ZGC Administrative Committee report in 2003, Beijing had 50,000 people working for 2,000 consulting agencies by 1999; 9,000 were in public quality-control agencies. There were also more than 300 lawyers’ offices with 3,300 employees and 144 accounting firms with 2,117 employees (ZGC Administrative Committee 2003). But this accounted for all of Beijing; agencies specializing in the information business would certainly be only a fraction of the total. Given the size of Beijing’s economy, the overall number of business services is very small.

To address the weak business service sector, the Beijing municipal government put considerable effort into the creation of technology-exchange markets where universities, research institutes, and state-owned enterprises could sell their technology or projects to potential investors or interested enterprises. The initial exchange market, which was rather primitive, was managed by the Beijing Municipal Science Commission in the early 1990s. The market has grown considerably over time. By 1999, the total monetary worth of contracts had increased more than eightfold. There were also 28 technology-contract registration offices and 130 certified technology consulting firms. The largest sellers by far have been Beijing’s local research institutes, and the largest buyers are state-owned companies. Over half of the contracts were sold to other regions of China.6

In 2000, another institution was established to market equities of state-owned institutes both inside and outside China: the China Beijing Equity Exchange (CBEX, ).7 CBEX collaborates closely with the ZGC Administrative Committee to market research projects generated in research institutes and universities in the region.

The establishment of the technology-exchange market or CBEX was intended to solve the intractable problem of undefined property rights in state-owned enterprises, facilitate research commercialization, and bring a measure of transparency and competition to the often corrupt allocation of projects and resources. The system is still primitive, as China’s reform of state-owned enterprises has yet to make much impact in educational and research institutes.

Of all the professional services in the ICT industry, the best developed is the public media. Many magazines are devoted to IT-related news, and even higher numbers of websites and blogs carry extensive industrial discussions. Also, as one of China’s most developed convention centers, Beijing has attracted endless international and domestic exhibitions, conferences, and workshops on the ICT industry. During my fieldwork in Beijing in the early 2000s, hardly a week passed without some sort of IT-related public event taking place in the city. The conventions are important sites for developing business networks and gathering information. The representatives of the companies we interviewed that had moved from other provinces all marveled at the ease of getting information in Beijing.

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