In October, China’s head of state and party leader Xi Jinping announced at the grand congress of the Communist Party: “China has joined the ranks of the world’s innovators.” It is a success to be proud of. Within just a few decades, the world’s workbench has become a country from which the most technologically efficient companies in the world come from.
This is impressively shown by a new study by the renowned Australian Strategic Policy Institute (ASPI), which has recorded how China performs in comparison to other countries across all important technology areas.
With a view to possible military conflicts in the South China Sea, one observation in particular is worrying: China is already a leader in the field of modern aircraft engines, including hypersonic technology used by the military.
Not only, but also armaments projects
According to the ASPI report, seven of the ten best institutes dealing with this technology come from China. At the end of 2021, the People’s Republic surprised experts with the test of a nuclear-capable hypersonic missile. Chinese scientists had once sent the rocket around the globe.
For years, the Chinese government has been investing more and more money in upgrading and developing its military capabilities. And at the start of the People’s Congress currently in Beijing, the government announced a 7.2 percent increase in the military budget.
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But China is also a leader in other areas, such as telecommunications technologies, especially 5G and 6G networks. These ensure particularly fast data transmission and will play an important role in future technologies such as autonomous driving. Or the super-fast control of machines.
According to ASPI, Chinese companies and research institutions are already among the best in the world in this area. Almost a third of all publications worldwide come from the People’s Republic.
According to the analysis, there is a very high risk of monopoly formation. The ASPI researchers base their judgment on the number of top Chinese institutes, among other things. According to this, eight of the ten most successful research institutions in high-performance telecommunications technology are in China. In addition, the country publishes more than three times as much research as its closest competitor in the field.
Demonstration of power at battery manufacturer CATL
Market concentration in some fields of technology in China has grown to such a degree that even the Communist Party itself is concerned. On the one hand, because it endangers their absolute claim to power in all areas of life. On the other hand, there is the fear that the monopolies will prevent Chinese competitors from gaining ground and thus limit innovations.
In recent years, the state leadership has intervened massively in the tech industry with regulations and targeted the largest companies, including the e-commerce giant Alibaba and the transport service provider Didi. Xi sent the latest warning to the CATL company at the start of the People’s Congress.
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The Chinese state and party leader was quoted as saying by the state news agency Xinhua in a conversation with CATL boss Zeng Yuqun that the group’s status as the world market leader in battery cells for electric cars is both cause for joy and concern. The markets did not see the conversation as a good sign: the company’s shares fell by around 1.5 percent.
On the other hand, the Chinese leadership once again made it very clear at the People’s Congress that it is continuing to focus on becoming more technologically independent. As the state news agency Xinhua reported on Tuesday, Beijing is planning a major bureaucratic restructuring of the Ministry of Research and Technology, among other things.
According to Xinhua, the aim is “to better allocate resources to meet the challenges in the key and core technologies and to achieve greater autonomy in science and technology more quickly”.
In the Asia Techonomics column, Nicole Bastian, Dana Heide, Sabine Gusbeth, Martin Kölling and Mathias Peer take turns writing weekly about the most exciting technological and economic trends in the world’s most dynamic region.
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