After becoming the first industrial power, China aims for technological independence and wants to excel in eight strategic sectors: wide-body aircraft, smart phones, large tractors and combine harvesters, and advanced medical equipment; industrial robots, renewable energy equipment, marine components, and green vehicles. The goal is to become independent of semi-finished products and capital goods purchased from abroad.
Beijing strategy
This involves the acquisition of techniques and skills, and then the ability to develop independently. The transformation is neither simple nor obvious, and yet it is being pursued with great determination and without hesitation, using a suite of tools to steer the system in the desired direction: direct control of production and financial intermediaries, with the support of private state-owned enterprises. Individuals who undertake to pursue common strategic goals, forced transfer of technology from foreign companies investing in China, and acquisitions of companies abroad, ”explains economist Luca Paolazzi, advisor to Ceresio Investors and Scientific Director of Nord Est, who is already an advisor to the Ministry of Economy and Finance.
The domestic market and foreign investment
China’s growth as a technology powerhouse was facilitated by foreign companies that invested in the country or transferred more sophisticated orders to Chinese suppliers, making them market leaders, even if they did not want to. Â «As in the case of smartphones, they have become faithful companions in our lives. And about the microchips that are its heart and also an inexhaustible source of big data, that is, the raw material for the digitization of economic systems, ”Paolazzi emphasizes. The Chinese case shows how important a large domestic market is to succeeding in global competition. Â «The huge internal market means companies that are not suitable for competitors, that is, large companies in China to be large in the world. Three examples: Hikvision (surveillance cameras), Fuyao (windshields and car windows), Gre Electric (air conditioners). It was born in 1992, is led by a woman, has a turnover of nearly $30 billion and employs 70,000 people. The first bill is $12 billion, and the second, also born in 1992, has revenues of $4 billion and is best known for the 2019 docu-film American Factory, which tells of its acquisition and restructuring of a plant in Ohio that General Motors closed. ”, highlights the Scientific Director of the Northeast Foundation.
Patent precedence
Beijing is already the first in the number of active patents. In 2021 there were 3.6 million, compared to 3.3 million in the US and 2 in Japan. According to a report by the Australian Strategic Policy Institute (ASPI), released in March, China leads in 37 out of 44 technology sectors, including defence, aerospace, robotics, energy, environment, biotechnology, artificial intelligence, advanced materials and quantum technology. According to the study, Beijing is building the foundations to become the world’s first technological superpower, securing an advantage in research in the most important and emerging technological sectors. Strong incentives to attract foreign manufacturers (for example, Taiwanese) or keep local factories (Intel) and bans on exporting cutting-edge technologies to China are the American response to all this, says Paolazzi.
Beijing aims for the moon
China has also launched a complex lunar exploration program, aimed at creating a manned base at the satellite’s south pole. The first three phases of the program have been successfully completed (including the moon landing with material sampling) and it has now entered its fourth and final phase. This tells us that Beijing also aspires to play a leading role in the space economy. The Zhurong rover that landed on Mars in 2021 was able to transmit information for about a year, although it was designed to last three months. Only the United States managed to do the same, ”recalls the advisor Ceresio Investors. Another area in which Beijing is challenging the US is quantum computing.
“Prone to fits of apathy. Introvert. Award-winning internet evangelist. Extreme beer expert.”
