The moon is the limit for good reason

The successful launch of Chang'e 3 and its moon rover Yutu, or Jade Rabbit, marks a giant step in China's lunar probe program. Chang'e 3 is expected to land on the moon on Dec 14, after which the six-wheeled Yutu will be lowered in stages to the moon's surface to explore the terrain.  [Special coverage]

Some people, however, have criticized the lunar program saying it is highly costly and has no economic returns. True, by sending a rover to the moon, China will not make any immediate profit, but in the long run the program could become a powerful driving force for the economy. And although the total cost of the moon mission is not known, the first two phases of the program - Chang'e 1 and Chang'e 2 - cost 2.3 billion yuan ($378.67 million ), which is not very high considering its importance.

Routine innovations are far from enough to propel technology in this age. Programs that involve advanced technology are needed to revolutionize the system. And the moon probe is a typical example of such a program. In fact, all space flights have helped develop the field of technology. The US' Project Apollo in the 1960s and 1970s contributed immensely to the development of modern technology. Before human beings flew into space (and later to the moon), computers were more like heavy machinery. It was the need to fly to the moon that prompted scientists to drastically reduce the weight of CPUs, leading to the development of a vast industry of microcomputers.

The same applies to wireless communication. Since moon rovers and spaceships needed reliable communication through vacuum, scientists further improved the existing wireless technology, which later developed into information technology.

China's moon mission will encourage similar developments. To send a rover to the moon, China needed more powerful and innovative propellers, highly effective non-fossil fuel and securely functional high-capacity nuclear battery. This expedited research and development, whose results could also be applied for civil use.

Technological advancement has acquired great strategic significance for China. Facing an aging population and rising labor cost, China cannot rely on labor-intensive industries forever; it has to upgrade its industries.

As Premier Li Keqiang said after taking office in March, China needs "an upgraded version" of its economy. And the 12th Five-Year Plan (2011-15) also stresses that China will develop into an "innovative country".

To fully realize the potential of advanced technologies like astronautics, China needs a series of reforms in other systems. It also needs to explore the market potential of supporting research in and development of modern technologies. In this regard, the market plays an important role. For example, The US financial market reacted positively to Project Apollo by offering enough financial support to high-tech programs, which helped make the program such a big success.

China shares the US' enthusiasm in developing high-end technology, but its financial market is not mature enough for the job (or challenge). China has developed "private equity" and "venture capital" investments thanks to the existence of a "growth enterprise market" within its stock market, but it still lacks "angel investment" that is widely considered a necessity to support innovative technologies.

Some companies, like Facebook, that have changed our life in the age of the Internet were supported by "angel investment" in their early stages. So China needs to reform its financial system to rally more support for business startups.

Besides, China needs to modernize its concept of industry and invest more in new industries. Light industry does serve people's daily needs and heavy industry does serve manufacturing and construction needs, but the importance of new industry based on technological upgrade and innovation cannot be overstated in the age of information. The first two still form the industrial basis of China, that's why there is an abundance of "made in China" products across the globe. To change the "made in China" label to "created in China", the country needs to develop new industries and establish a new innovation mechanism, and of course allocate more funds for R&D.

The moon probe mission may demand a huge amount of money, but it will bring great benefits to the country in the long run. It is time to look into the future instead of being blinded by prejudices.

The author is director of Hong Kong-based China Academy of Xinsheng Economy, and has a book, Uncoding Economy, to his credit. The article is an excerpt from his interview with China Daily's writer Zhang Zhouxiang.