Taiwan’s gross domestic expenditure on research and development (R&D) is ranked third-highest in the world as it reached 3.36 percent of total gross domestic product, or NT$616 billion (US$20.55 billion), in 2018, the Ministry of Economic Affairs Department of Statistics said in a report yesterday.
That surpassed Japan’s 3.26 percent, the US’ 2.83 percent and China’s 2.19 percent. Taiwan’s gross domestic expenditure on R&D closely followed Israel’s and South Korea’s, which remained the top two spenders on R&D at 4.9 percent and 4.53 percent respectively in 2018.
Corporate spending has become the main driving force behind Taiwan’s gross domestic expenditure on R&D, making up 80.3 percent of total expenditure, on a level with that of South Korea, ministry data showed.
Japan, China and the US posted slightly lower figures at 79.4 percent, 77.4 percent and 72.6 percent respectively.
The ministry data also showed that Taiwan’s spending on R&D is concentrated on technical development, which increased 8.2 percent from 2017 to make up 69.7 percent of total expenditure in 2018.
Corporate spending was highest in the manufacturing sector, namely the computer, electronics and optical components industry, which made up 73.6 percent of total corporate expenditure on R&D in 2018.
By comparison, South Korean firms in this industry made up only about 51.9 percent of total R&D expenditure, while in Japan and China, it only made up 19.5 percent and 16.2 percent respectively.
Taiwanese companies’ R&D spending in the service sector only made up 8.2 percent of total corporate expenditure on R&D.
Meanwhile, Taiwan’s spending on basic research declined by 3.6 percentage points over the same period, making up only 7.3 percent of total expenditure.
This is mainly due to budget cuts in government spending, as well as in higher education, the report said.
However, Taiwan’s spending on applied research increased 8 percentage points from 2017 to 2018, contributing 23 percent of total expenditure.
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