Prior to 2000, the Chinese media made practically no mention of the concept of “nanotechnology” (nami jishu) or its potential for revolutionizing China’s high tech industry. Today, however, dozens of major Chinese research centers and hundreds of enterprises engage in the production of nanotechnologies, which has quickly become a multibillion-Yuan industry. Concentrated in China’s major economic centers such as Beijing, Shenyang, Shanghai, Hangzhou and Hong Kong, these urban hubs account for some 90 percent of all nanotech Research and Development.
The rapid development of China’s nanotech industry is due in large part to the intervention of the central government. Apparently added to a list of priority technologies at the end of the 1990s, nanotech has enjoyed state funding since then through National 863 Hi-Tech R&D Plan. The plan provided huge investments for nanotech projects from both the central and local governments. It seems that the Chinese leadership had plans to transform their nanotech industry by 2010 – with the hope of making it comparable to China’s microelectronics, telecom, and other high-tech industries.
Remarkably, developments within the industry have been both civilian and military in purpose, though the latter has, of course, enjoyed a higher degree of priority. Strategists within China’s People’s Liberation Army (PLA) understand perfectly well the significance of nanotechnologies in military reforms within the United States over the last twelve years. With this in mind, China has actively cooperated with leading nanotech companies in the United States and Europe. It seems reasonable to assume, also, that such cooperation is well underway with the Russian Federation.
Major Nanotech Complexes
In July 2001, Shanghai Nanotech Promotion Center (SNPC) was established to focus on R&D and the industrialization of tools needed for nanotech research. (Shanghai had already started work on a $217 million Stone Nanotechnology Port in May of that year.)  Also in July, the Shanghai city government announced that it would soon open a nanotech base, uniting three, state-level research centers, several laboratories focusing on nano-materials, and eleven additional companies specializing in the commercialization of R&D products.
The first phase of construction, near East China Science and Technology (S&T) University, was finished within the month, and 76,000 square meters immediately became available for nanotech firms. Plans had been made for an additional 200,000 square meter facility at the same location, but in August, the Shanghai Municipal S&T Commission announced the city would concentrate its resources to focus on research and industrialization over the next four years (2001 to 2005). The intent of the project was to dramatically improve China’s nanotech R&D and commercialization, particularly in nano-materials, nano-electronic components and nano-biological/medical technologies. The Shanghai S&T Commission stated that it would also set up a nanotech incubator program. At that time (July 2001), there were already twenty institutions engaged in nanotech development in Shanghai. 
Less than a year later, in May 2002, the Shanghai S&T Commission announced its intent to provide further investment opportunities and preferential treatment to nanotech-related companies. Zhu Jiping, Director of the Commission, was quoted as saying: “In 2001, Shanghai government invested 30 million Yuan in nanotech – nano-biology, nano-medicine and nano-electronics; this laid solid foundation for nano-sector. We are now pushing nanotech development to 2nd stage – nanotech products industrialization. Shanghai’s government will accelerate the application of nanotech in different industries, especially automotive products.”
This push to accelerate Shanghai’s nanotech production was echoed by Shanghai Nanotech Promotion Center’s (SNPC) new director Niu Xiaoming: “At this second stage, SNPC will help companies in the nano-sector to improve their advanced technologies. SNPC strives to establish an information network linking all professionals in the sector. Currently six nanotech R&D centers – built in such leading Shanghai universities as Jiaotong University, Fudan University, East China University, East China Normal University, Shanghai University and East China S&T University – are exchanging their latest nanotech results through this network.”  By mid-2002, Shanghai had developed an extensive nanotech infrastructure, which led to the rapid development of nanotechnologies throughout 2003 and 2004.
At the same time as Shanghai was experiencing its nanotech boom, Beijing was also investing heavily in this new industry. The Center for Nanotechnologies at the Chinese Academy of Sciences (CAS) in Beijing opened in 2000. Uniting over a dozen CAS institutes and several university laboratories, the aim of the center was to upgrade scientific cooperation while accelerating nanotech industrial development in Beijing. Just one year later, in December 2001, Beijing’s Tsinghua University announced a new approach to the production of carbon nano-tubes at a rate of 15 kilograms per hour, 60 times faster than the speed at which they had originally been produced. 
In November 2002, CAS launched a joint project with the U.S. company, Veeco Instruments Inc. The CAS Institute of Chemistry and Veeco agreed to cooperate in the running of a nanometer technology center aimed at providing access to Veeco-made nanotech instruments to Chinese researchers, including atomic force and scanning-tunneling microscopes. The center would also provide the Institute of Chemistry’s molecular nanotech R&D division with “super-advanced” measuring and controlling devices. The Institute’s chief researcher, Chen Wang, has worked closely with CAS vice president Bai Chunli to ensure support for his work on molecular nanotechnologies.
The partnership between CAS and Veeco came amidst great optimism regarding China’s nanotech potential. “China will gain the leadership position in nanotech,” remarked Veeco President Don Kania at the opening ceremony. This bold statement of confidence in Chinese nanotech superiority was affirmed by Bai Chunli, CAS vice-president and chief scientist of the National Coordinating Committee for Nanotech, who stated simply: “China enjoys the advantage in research of nanometer materials.” By the time the center opened, China had more than 300 enterprises in the nanotech sector, with some 7,000 scientists engaged in nanotech R&D.
The CAS-Veeco center was just one part of China’s plan to establish a national nanotech infrastructure. At the end of March 2003, CAS, Peking University and Tsinghua University announced a joint National Center for the nation’s long-term nanotech development. Approved by the State Council, the Center will enjoy an early-stage state investment of 250 million Yuan ($30 million). The Central government has budgeted two billion Yuan (about $240 million) for nanotech projects between 2003 and 2007; another 2 to 3 billion Yuan is due from local governments. 
This heightened investment in nanotech has not been limited to Beijing, however. At the end of June 2001, CAS and China’s Ministry of Science and Technology unveiled the Shenyang National Laboratory for Materials Science (SYNL). The newly established laboratory is expected to compete with its counterparts in the United States, Japan and Germany.  And, in November 2003, a Nanotech Park was established in Xian. Hong Kong has also developed a large complex of nanotech industries, while Zhejiang University in Hangzhou became the center of nanotech R&D and industrialization in the prosperous Zhejiang province.
At the present time, some thirty institutions are engaged in basic nanotech research. These include CAS Physical Institute, CAS Chemical Institute, CAS Solid Physics Institute (Hefei), Tsinghua University (Beijing), Beijing University, Hangzhou University, Nanjing University, and several universities in Shanghai. In addition, Shanghai, Beijing, and Shenzhen have each created their own Nanotech Centers, uniting local R&D structures. In terms of basic nanotech R&D, China has reached the most advanced levels in the world, rivaling even the capacities of the United States.