Businessweek says:

In the intense economic rivalry between China and Japan, the mainland has grabbed all the attention in Asia with its double-digit growth rates and $1 trillion stockpile of foreign currency reserves. But the Japanese have been able to console themselves that they still have the edge when it comes to research and development spending, right?

Not according to controversial figures released by the Organization for Economic Cooperation & Development. On Dec. 4, the OECD announced that China's total spending on R&D for the year will top $136 billion.

To read more:

http://www.businessweek.com/globalbiz/content/dec2006/gb20061212_378520.htm?chan=top+news_top+news+index_businessweek+exclusives