A nice follow-on piece to that, which was a commentary on an article in Asia Times, is this from Wired. Not an exhaustively researched article or anything, but it does highlight the fact that a huge amount of dollars are being funneled into China for research projects and enterprises.
It's an upbeat article, but here is where I think it goes a bit too far: "[T]he pieces are now in place for a great leap forward from 'made in China' to invented there."
Spending a lot of money on research and development does not mean that a country will suddenly turn into a hotbed of innovation. It's not that simple.
Figuring out how to go from a manufacturing economy to a knowledge-based innovation economy is somewhat of a mystery. Different people will highlight education spending, targeted tax breaks, infant industry protection, and a nice long laundry list of ways that a government can incentivize innovation. But as an inherently creative process, innovation is less predictable than the weather.
Will all this spending lead to substantial growth in homegrown tech? Yes, undoubtedly. But keep in mind that these research and development shops are not playgrounds where multinationals dump a lot of money on a group of PhDs and let them come up with whatever they can dream up that day.
Research centers are more likely to be rigid, project-oriented facilities that include strict control over the creative process. Your average "researcher" in one of these China facilities is given just enough information to do his/her job, many times having no idea what the end result of all that work will be. Kind of reminds me of a young litigation associate at a big firm working on a class action tort case – he sits in a document room all day long looking at papers and summarizing them, all the while having no idea what the case is all about.
I suspect that innovation policy can only encourage, it cannot force creation. For that, education, culture, overall economic activity, societal need, and a lot of other factors come into play. No one really knows for sure what will happen here in the short or medium term.