Introduction competition to other foreign investors. However, this


According to Estrin (2009), China has succeeded in competing with other foreign counterparts in the innovation and commercial activities capabilities. It aims to provide its domestic enterprises with advanced products and technologies through the Intellectual Property Rights (IPRs). China is set to go ahead with the strategy of adopting indigenous innovation. It introduced technologies from other foreign countries to develop its economy. This helped it gain global recognition of creating competition to other foreign investors.

However, this was dispatched in the World Trade International (WTO) where most of the multinationals tried to prevent China from acquiring more knowledge and technologies from foreign investors claiming that they are a threat in market competition. This has made it difficult for China to compete with existing multinational companies. It is therefore necessary for other companies to develop their research to acquire technology knowledge and commercial activities from core technologies to become competitive (Estrin, 2009).

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Zhang (2009) adds that China has succeeded because of its confidence, ceaseless experiments, motivation, and patience on developing its own commercial activities and technology. Nevertheless, China lacks the urgency creation in its commercial activities on the importance of indigenous innovation in both the domestic and international markets.

It cannot create confidence to customers in the markets on the reliability and dependability of its products. This has led to low returns on investment by the country. This is risky because for the country to develop its core technologies it becomes very expensive and the bad image and reputation created by the consumers may lead to their underperformance in the markets (Zhang, 2009).

Government Support on Innovation and Commercial Activities

The central government of China introduced a policy that supported indigenous innovation in its domestic companies. Several agencies of the central government joined forces to ensure implementation of the policy. The local government succeeded in implementing this policy through trial measures that proved to be effective.

The National Science and Technology Conference outlined indigenous innovation as a government’s strategy for innovation and commercial activities. The government was ready to create an environment conducive for establishing commercial activities with the strategy.

It made it possible through a series of policies that supported and protected its domestic business enterprises technologies. The policies include the IPR protection, acquisition foreign technology, tax reduction, government purchases, policy coordination, financial support, funding, assimilation of foreign technology, and management of pool of talents (Estrin, 2009).

The country invests heavily on acquiring and maintaining highly talented, competent engineers, and scientists to assist in the campaign for innovation nationally. This is to help provide assistance to enterprises willing to incorporate technological innovations independently. The government played the larger role in promoting the economy of China despite the criticisms from the rules of WTO.

Its unwavering support helped the domestic enterprises realize that it was important to develop core technologies, innovate effectively, and invest more without fear of risks. The government has however taken steps to ensure that it increases competition for its domestic products. This involves the enforcement of policies that encourage the business enterprises to have their own technology and avoid importing technology from foreigners (Estrin, 2009; Zhang, 2009).

The government has promoted technology breakthrough through advancing research in universities, institutes, and business enterprises. The government has introduced regulations on imports and foreign investors to reduce competition of the domestic products and investors.

This has helped the country develop its economy through innovation and commercial activities. The government of China has created long term plans for its business enterprises that include quality education, well trained Army Scientists in the foreign countries, joint ventures with foreign multinationals who bring large incomes to the country’s economy, and a highly competitive domestic market in creating demand for innovated products (Estrin, 2009).

The country supports and encourages management of talents and an international expansion by creating employment opportunities both locally and internationally. Despite the underestimation of its development in innovation by the U.S. government, it continues with its potential and progress without demoralization.

The government has invested heavily in projects that help it develop its own original innovations to curb competition for its products and from new entrances into the market. Nevertheless, the China innovated products and commercial activities are in a good position to succeed even better than most of the multinational products. This calls for greater efforts in the government in promotion of innovations and commercial activities in the country (Estrin, 2009; Zhang, 2009).

Recommendations to the U.S. Government

The capability of China to innovate should not be underestimated, especially by the U.S. government. The U.S. government should not wish that the China government will stumble. This is because China has proven to be successful in commercial activities and innovation. It has been highly competitive for a long period without difficulties and strain. The U.S. government should instead motivate its own investors to innovate more and provide regulations that support and protect its investors.

The U.S. government should emulate the government of China in promoting quality education in schools and intuitions, especially in the sector of technology and innovation. This builds strong roots for more and better innovation activities in the future. The U.S. government should invest heavily on development and research to create a service and knowledge economy of innovation.

This helps the country to improve its GDP and competition for its own products. The government should enforce policies and regulations that discourage foreign investors and products to promote its own and encourage export of its products. This will encourage its investors to innovate and create more commercial activities (Estrin, 2009).

The U.S. government should take time to know China more than China knows it. This will help the government counterfeit the plans of China government to create more competition. The U.S. government has more core technologies than China. It should concentrate on developing these technologies to create more competition in both the domestic and international markets.

It has greater chances of succeeding in the market than China if it implements better policies and regulations on its innovation and commercial activities. It should not allow products from China to create any competition for its products. The U.S. government policies and regulations should consider lowering the price of its goods and services that is a major threat to the success of its brands.

It should also enhance its distribution channels to ensure availability of its products in both the domestic and international markets. This will help the country counterfeit cheap and readily available products from China in the global markets. Nevertheless, the U.S. government is more successful in incorporating and supporting innovation and commercial activities than China by far (Zhang, 2009).


Estrin, J. (2009). Closing the innovation gap: reigniting the spark of creativity in a global economy. New York, NY: McGraw-Hill.

Zhang, C. (2009). Promoting enterprise-led innovation in China. Kansas City: World Bank Publications.