Daily Times

The dynamics of technological supremacy are undergoing a rapid transformative shift. After years of observing the Western world’s advancements in software and semiconductor innovation, China has emerged as a significant player in advanced technologies. While experts generally perceive China as slightly trailing the US in AI development, the nation is driven by an ambitious vision to assume global leadership in two pivotal domains: AI and renewable energy. China’s solar PV capacity has surpassed 670 GW in the first half of 2024, making it the world’s largest producer of solar energy.

China’s determination to be the world leader in AI by 2030, with an industry worth US $150 billion, is truly inspiring. These advancements not only position China as a key player in the global tech landscape but also have significant implications for the US-China tech rivalry. Keeping China’s ambitions in mind, the real question is, where does the Chinese AI and clean energy industry stand? Currently, though China lags behind the US in terms of AI advancement, when OpenAI introduced ChatGPT in October 2022, the Chinese were caught by surprise. They did not anticipate that OpenAI would be able to introduce a powerful new tech tool in such a short period of time. In response, Chinese tech firms launched their version of generative chatbots one after another in 2023 after getting the green light from the government.

Despite being new, the Chinese company boasted substantial financial backing. It garnered a valuation of US $1 billion, positioning itself as an alternative to offerings such as Meta’s generative AI model, LLaMA. Similarly, Ernie Bot (Enhanced Representation through Knowledge Integration), an AI chatbot service product of Baidu, built on a large language model called ERNIE 4.0, was released in 2023. China still faces challenges in AI development. The US Open AI had a head start over China, making it difficult for China to catch up. It has created a technological gap between open AI and its Chinese equivalents. The biggest advantage ChatGPTand other US-based open AI over its Chinese competitors is ‘data’. It is one of the major constraints for Chinese tech companies due to a lack of data availability. Most global websites are in English, and only about 1.5% of international websites are written in Chinese. This, coupled with geopolitical tensions, has created a dilemma for Chinese tech companies. Chinese internet users usually generate content or interact through apps on their phones, like WeChat or Weibo. That has also created additional barriers for those AI models to pick up on data, and that is a fundamental flaw.

Data is essential for training AI, but not all countries are ready to hand over data to Chinese companies. One recent example is TikTok, whose parent company, Byte Dance, was accused of storing US users’s data in China and allowing Chinese authorities access to it. It is not possible to separate politics from data governance or data privacy. Chinese companies will always have a perception problem that the data they collect will be used for purposes other than purely commercial or may be used for purposes that do not fit either the EU or US frameworks, even if the truth is something else. In 2022, the US announced a ban on the sale of supercomputing chips and advanced chip-making equipment to curb China’s technological advancement. The Biden administration also restricted US investments in China, particularly in areas where AI could be applied for military purposes. This move underscores US concerns about China’s growing technological prowess and its potential applications in areas of national security. As long as these two powers compete, such concerns will continue to shape the US-China tech rivalry.

China has surpassed the US as the biggest producer of AI talent, with almost half the world’s top AI researchers coming from China. It is a significant increase from just three years ago, when China produced about one-third of the world’s top talent. The imbalance has been growing, with more Chinese researchers staying in China. The competition between China and the US for AI primacy has also led to a funding frenzy. The US-China relationship is not likely to improve significantly in the coming decade, which is why China now focuses on self-reliance on advanced technology.

The US-China trade war intensified in August 2022 when the Biden administration banned high-tech exports to China. The EU also has a plan to restrict Chinese solar panels, claiming they were made with forced labour from Xinjiang. In response, Beijing decided to ban key solar technologies. China controls 75% of the manufacturing process to assemble solar cells in modules, as well as 85% of solar cell production. Such a ban could have significant implications for the solar supply chain.

When it comes to the competition between China and the US, technological decoupling in the high-tech sector is quite natural. The real competition is who will lead the transformation of technology in the future. Now, China is in a position to potentially lead this transformation, a prospect that not only underscores the gravity of the US-China tech rivalry but also the potential for China to shape the future of technology. However, China must convince the world of its high-tech viability if it wants to be a global leader by 2030.

Usama Gurmani specializes in strategic communication, crisis management, and public relations. He holds an MPhil degree in Peace and Conflict Studies. He can be reached at usamagurmani994@gmail.com.