Premier Li Keqiang said China needs to step up efforts to encourage innovation to develop new locomotives for the Chinese economy.

New development modes and management patterns are a prerequisite for economic transformation and upgrades, the Premier said at a State Council executive meeting on March 30.

The plan to build Shanghai into a comprehensive science center and set up three more national innovation demonstration zones around China, rolled out at the meeting, relies on system innovation, the Premier said.

“Pilot areas are necessary when developing a new economy, and we can replicate the successful programs in wider areas,” said Premier Li.

Breakthroughs must be made in mobilizing the innovativeness of talent through changing the present mode of management, the Premier said.

“We introduced a policy two years ago concerning technology employees of enterprises that are registered at the Zhongguancun Science and Technology Zone in Beijing. According to the policy, before the employees’ share options are exercised, no tax will be levied, but some entrepreneurs said at the Boao Forum for Asia earlier this month that the policy was not being implemented,” said Premier Li.

The Premier called for efforts to avoid such problems in Shanghai and the three new innovation demonstration zones.

Premier Li called on the government departments concerned to make efforts to expand reform and innovation programs to their affiliated colleges and research institutes, pointing out the key here is to give those entities greater autonomy.

Universities and research institutions under ministries have more restrictions on transfer of science and technology achievements.

Premier Li emphasized that regulations on university research funds, especially on personnel expenses, must be altered to give more autonomy to research staff.

“I heard that in some places, even buying a cup of coffee for foreign experts attending seminars would be restricted,” the Premier said, adding that over time, such institutions will lose their vitality.

He stressed that it is not enough to solely focus on purchasing large amounts of advanced equipment and that more efforts are needed to boost brainstorming by research staffers.

“We are witnessing a new round of industrial revolution, and it is time to make a resolution to achieve new breakthroughs. And only when the research personnel is given full initiatives can an environment of innovation be formed,” the Premier said.