II. S&T funds allocated by finance

In 2008, S&T funds allocated by national finance amounted to 258.18 billion yuan, a year-on-year increase of 46.83 billion yuan, and rose 22.2 percent, sharing 4.12 percent to national financial expenditure.

Note:

In 2006 and prior fiscal spending on technology, including three items of expenditure on S & T, science operating expenses, expenditure on capital construction for scientific researches, and other research operating expenses; in 2007, after the reform of government revenue and expenditure classification system, fiscal expenditure including S & T courses and other functions under the expenditure for it; the technology spending before and after the fiscal year covered basically the same.

Explanatory Notes on Main Statistical Indicators

Research and Development (R&D) refers to systematic and creative activities in the field of science and technology aiming at increasing the knowledge and using the knowledge for new application. R&D includes 3 categories of activities: basic research, applied research and experimentation for development. The scale and intensity of R&D are widely used internationally to reflect the strength of S&T and the core competitiveness of a country in the world.

Basic Research refers to empirical or theoretical research aiming at obtaining new knowledge on the fundamental principles regarding phenomena or observable facts to reveal the intrinsic nature and underlying laws and to acquire new discoveries or new theories. Basic research takes no specific or designated application as the aim of the research. Results of basic research are mainly released or disseminated in the form of scientific papers or monographs. This indicator reflects the innovation capacity for original knowledge.

Applied Research refers to creative research aiming at obtaining new knowledge on a specific objective or target. Purpose of the applied research is to identify the possible uses of results from basic research, or to explore new (fundamental) methods or new approaches. Results of applied research are expressed in the form of scientific papers, monographs, fundamental models or invention patents. This indicator reflects the exploration of ways to apply the results of basic research.

Experiments and Development refer to systematic activities aiming at using the knowledge from basic and applied researches or from practical experience to develop new products, materials and equipment, to establish new production process, systems and services, or to make substantial improvement on the existing products, process or services. Results of experiment and development activities are embodied in patents, exclusive technology, and monotype of new products or equipment. In social sciences, experiment and development activities refer to the process of converting the knowledge from basic or applied researches into feasible programmes (including conduct of demonstration projects for assessment and evaluation). There are no experiment and development activities in the science of humanities. This indicator reflects the capability of transferring the results of S&T into technique and products, and measures the realization of S&T in spearheading the economic and social development.

*Industrial sector only includes data from medium-large sized industrial enterprises.