China

The best way for U.S. policymakers to think about China, at least in the realm of technology and industry, is that we are engaged in a form of war: China is seeking to defeat the United States on the techno-economic battlefield.

China accounted for 35 percent of global manufacturing as of 2023. The United States and Western allies should launch a global competition to establish competing manufacturing hubs in countries that commit to reforming restrictive regulations, reducing corruption, boosting skill development, and ensuring adequate financial incentives and infrastructure.

The European Union needs to pay a short-term price for long-term gain by standing alongside the United States in taking tough action to hold China accountable for its IP theft, dumping, and over-subsidizing.

The United States and Japan must make a concerted effort to mutually advance their economic security and counter Chinese economic coercion, while bringing other allied nations aboard the enterprise to the greatest extent possible.

Please join the Information Technology and Innovation Foundation for an expert briefing event to discuss the findings of a 20-month ITIF investigation into Chinese firms’ innovative capabilities in key advanced industries, including robotics, chemicals, nuclear power, electric vehicles, semiconductors, AI, quantum computing, and biotechnology.

There may be no more important question for the West’s competitive position in advanced industries than whether China is becoming a rival innovator. While the evidence suggests it hasn’t yet taken the overall lead, it has pulled ahead in certain areas, and in many others Chinese firms will likely equal or surpass Western firms within a decade or so.

Chinese companies have become leading innovators in display technologies, in addition to becoming the largest global producers. China’s display industry has grown as a result of extensive subsidies, rampant intellectual property theft, and economies of scale.

Forget the nonsense that China can’t innovate. Beijing may well come out on top in advanced industries.

China’s long-standing and rampant “innovation mercantilist” policies harm global innovation by taking market share and revenues from more-innovative foreign competitors, which diminishes the resources they can invest in research and development toward further innovation. ITIF has conducted extensive analysis on this issue.

China’s lead in quantum communications is undeniable, but its overall quantum prowess is limited; without computing breakthroughs, the United States still holds the upper hand.