Five Facts on the Rise of Chinese Tech

The Big InsightChina already is or soon could be the global leader in artificial intelligence, semiconductors, 5G, quantum computing and other technologies that could define economic leadership in the 21st century.

The rise of China’s tech sector has gotten the attention of Congress. The bipartisan U.S. Innovation and Competition Act passed the Senate last June, and the Democratic America COMPETES Act was introduced in the House in January. Here are five facts about why China’s growing technological prowess is a concern for the U.S. both economically and in terms of security.

Here are five facts on the Rise of Chinese Tech.

1. In 2015, China launched a 10-year plan to transform the country from a “manufacturing giant into a world manufacturing power.”

It’s considered the linchpin of China’s effort to dominate 21st century technologies. Made In China 2025 aimed to increase domestic content of core materials by 70% to achieve near-independence from foreign suppliers. Beijing has invested nearly $2 trillion in the effort. According to the South China Morning Post, “analysts generally point to Made in China 2025…as the trigger for the tech war.”

2. China has nine times as many 5G base stations as the U.S. and China intends to triple its current total by 2025.

If that goal is met, China will have one 5G base station for every 400 residents by 2025 – up from one for every 2,000 two years ago. The U.S. currently has about one 5G base station per 3,300 residents. As it stands today, Chinese 5G network speed is five times as fast as American equivalents.

3. In 2019, Chinese universities produced just under 50,000 PhDs in STEM fields, while U.S. universities produced about 34,000.

According to Georgetown University’s Center for Security and Emerging Technology, the gap is widening. By 2025, China will turn out more than 77,000 STEM PhD graduates per year, while the U.S. will graduate just 40,000.

4. Chinese researchers say they have successfully developed a quantum computer that is one million more times powerful than the closest competitor, Google’s Sycamore system.

The Chinese physicists say the Jiuzhang 2 computer can calculate in one millisecond a task that would take the world’s fastest conventional computer 30 trillion years. Former U.S. cybersecurity chief Miles Taylor and Daria Bahrami of the Cybersecurity and Emerging Threats at the R Street Institute write in Fortune, “Beijing’s progress has worried security experts, especially those who believe we are inching closer to a cryptography ‘apocalypse,’ when sophisticated quantum computers could be used to decrypt U.S. data, from emails and financial records to state secrets.”

5. Taiwan produces about 63% of the world’s semiconductors, compared to the 12% produced in the United States.

In late January, the Center for a New American Security released the results of a wargame focused around a sudden shutdown of three Taiwanese semiconductor foundries. In the exercise, U.S. concerns that Chinese cyberattacks were to blame brought the two nuclear powers to the brink of armed conflict. The report compared U.S. reliance on Taiwanese chips to American reliance on Middle Eastern oil – a past cause of military conflict.

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