U S -China Economic and Security Review

China's Pursuit of Next Frontier Tech U S -China Economic and Security Review

China is attempting to become a technological leader in three emerging sectors: computing, robotics and biotechnology. Globally, advancements in these sectors are creating millions of high-paying, high-skill jobs and spurring the creation of entire new industries, such as data analytics. Many of these technologies have dual commercial and military applications and are important drivers of U. S. economic growth and technological and military superiority. The Chinese government is utilizing preferential support for domestic firms, localization targets and high market access barriers to build domestic capacity and eventually replace foreign technology and products with domestic technology and production, first at home, then abroad. These policies are slowly closing market opportunities for U. S. and other foreign firms in China and creating new Chinese competitors that will be able to challenge U. S. companies in the United States and in third-country markets with potential negative impacts on U. S. employment, productivity, and innovation. Through these policies, China is rapidly closing its technological gap. China in the last decade has rapidly expanded its high-performance computing capabilities, challenging the U. S. leadership. It now has the world's two fastest supercomputers and is tied with the United States for the number of supercomputers. Industrial policies outlined in the 13th Five-Year Plan (2016-2020) and related policy announcements seek to move Chinese manufacturing up the value-added chain, establish China as a global center of innovation and technology, and ensure China's long-term productivity in critical dual-use technologies such as computing, robotics, and biotechnology. Advancements in these sectors have previously driven U. S. technological and military superiority, and the Chinese government is looking to develop its own technological leaders and reduce its dependence on foreign technology.