MNCs rev up R&D presence in China

China has surpassed the US and India in 2007 as the most attractive destination in the world for research and development (R&D) investment, according to a recent United Nations report.

There are now approximately 1,000 R&D centers in China with most of them in the technology sector. The number of centers in the country continues to rise thanks to the ongoing investment by multinational corporations (MNCs), the increasing need to be closer to local customers and low labor costs.

While a number of these R&D facilities have been successful in terms of research results, product development and overall growth, others have never reached their targeted size or scope and have not provided the desired return on investment, according to a survey by Russell Reynolds Associates, a leading global executive search and assessment firm. The survey polled over 20 R&D center heads from the technology sector in China.