The transfer of proprietary technology from a foreign corporation is, among other things, a commercial transaction, and such transactions take many forms. Chinese authorities have selected joint-equity ventures as their preferred mode of technology transfer. In such ventures, both the foreign and the Chinese partner contribute capital, each provides what it has the advantage in (usually technology and access to world market for the foreign partner and labor and a factory for the Chinese partner), and management and profits are split. Many major foreign corporations with technology that China desires have been reluctant to risk their capital in such ventures. But enough have agreed to produce such items as jet airliners, computers, and machine tools that Chinese authorities can claim success for their policy.
Data as of July 1987