Manufacturing in China has a couple of faces. There's the ugly face the sweatshops get a lot of attention, like the fire at a plastics recycler in Shenzhen in February that killed 15 workers being housed illegally over the factory floor. Or the more than 3,700 people who die in coal mining accidents each year there.
But if that's all you see, you're missing something. There's another face emerging, one of more-sophisticated companies that rely on technology and want to be global players, not sweatshop operators. A recent trip to the boomtown of Shenzhen reminded me of that.
In May, I went to media day at Huawei Technologies Co. Ltd., which makes cell phones and telecom equipment under its own name and for 35 of the world's biggest 50 telecom operators. The sleek buildings and automated warehouses at its Shenzhen headquarters look like a slice of Silicon Valley.
Here's what struck me: Last year, Huawei ranked No. 4 globally among firms filing patents under the World Intellectual Property Organization. It jumped from 13th the year before. It ranked behind No. 1, Matsushita Electric Works Ltd. of Tokyo; No. 2, Dutch firm Koninklijke Philips Electronics NV of Amsterdam; and No. 3, Siemens AG of Munich, Germany all impressive neighbors.
Huawei, with its focus on research and development, provides a contrast to public misunderstandings that can surround China. The firm has 12 R&D sites worldwide and has jointly established product R&D centers with Vodafone, British Telecom, Motorola and others.
Huawei officials said they see potential in combining that research orientation with China's lower costs. They said an engineer in China costs one-sixth that in the West, giving them advantages.
``Some of the other Western vendors have had to pick and choose what they were going to put their money in, whereas Huawei, we have the flexibility to invest across the board,'' said Huawei spokesman Ross Gan. ``That allows us a lot of flexibility in terms of being able to develop technologies according to a variety of standards.''
U.S. firms still dominate the overall rankings, accounting for 33 percent of all filings, and Huawei is the only Chinese firm in the top 50. But, WIPO officials noted, China ranked seventh overall, with the fastest growth of any of the top 15. South Korea was the only other top 15 country to see double-digit growth in filings, ranking fourth overall. It's a sign of growing innovation in Asia. ``The growth in patent filings by a number of countries in northeast Asia and their share of overall patenting activity is impressive and confirms shifting patterns of innovation around the world,'' WIPO said.
The traditional economic powerhouses remain creative places. After all, U.S. firms filed 10 times as many WIPO patents as Chinese firms last year. China still has problems with IP protection, and it still depends largely on low-cost labor, sometimes in dangerous conditions, as its chief advantage in the international economy.
But as my day at Huawei reminded me, it would be a mistake to think that it's always going to be that way.
Steve Toloken is Plastics News' Guangzhou, China-based Asia bureau chief.