China's Technological Ambitions Amidst US Rivalry

China's push for technological self-reliance has intensified in response to the United States' restrictive policies, particularly in the semiconductor sector. Wang Yiming, vice-chairman of the China Centre for International Economic Exchanges, emphasized that China must transition from being a technological follower to a leader. He stated, “China can no longer play follower. The US won’t let it,” highlighting the urgency for China to master core technologies to mitigate vulnerabilities. Wang's remarks come amid a backdrop of heightened tensions between the two nations, marked by US export controls on chips and China's retaliatory measures on critical minerals.

South China Morning PostChina and US need new ways to engage in push for stable ties, Wang Yi saysChina’s Shenzhen targets AI in ‘every household’ as US tech rivalry heats upChina’s factory activity breaks 8-month contraction, but headwinds persist

In line with this national strategy, Shenzhen, China's leading technology hub, announced plans to implement a comprehensive adoption of artificial intelligence (AI) across households and businesses over the next five years. This initiative is part of Shenzhen's 15th five-year plan, which aims to position the city as a global tech leader by 2035. The local government’s policy paper outlines an “AI+” strategy that integrates AI into public services and commercial applications. Analysts view this as a critical step in China's broader technological ambitions, with Dai Mingjie from the South China University of Technology noting that Shenzhen's plans reflect a shift towards a more diversified technological landscape where China can leverage its manufacturing strengths.

China’s Shenzhen targets AI in ‘every household’ as US tech rivalry heats upSouth China Morning PostChina and US need new ways to engage in push for stable ties, Wang Yi saysChina’s factory activity breaks 8-month contraction, but headwinds persist

Amidst these technological advancements, China's top diplomat, Wang Yi, called for a new framework for engagement with the United States, advocating for stable and cooperative relations while asserting China's core interests, particularly regarding Taiwan. Wang reiterated that Taiwan is a crucial issue for China, framing reunification as a historical mission. His comments coincided with military exercises by the People's Liberation Army around Taiwan, underscoring the tensions in the region. Wang emphasized the need for mutual respect and cooperation, stating, “When China and the US cooperate, both sides benefit; when they confront each other, both are harmed.”

China and US need new ways to engage in push for stable ties, Wang Yi saysSouth China Morning PostChina’s Shenzhen targets AI in ‘every household’ as US tech rivalry heats upChina’s factory activity breaks 8-month contraction, but headwinds persist

On the economic front, China's manufacturing sector showed signs of recovery, with the manufacturing purchasing managers' index (PMI) rising to 50.1 in December, marking the end of an eight-month contraction. This rebound, driven by increased production and demand, suggests a potential stabilization in the economy, although analysts caution against premature optimism. Huo Lihui, chief statistician at the National Bureau of Statistics, noted that stockpiling ahead of the holidays contributed to the positive outlook for certain industries.

China’s factory activity breaks 8-month contraction, but headwinds persist

China's strategic initiatives in technology and manufacturing reflect its response to external pressures, particularly from the United States. As the nation seeks to assert its technological independence and navigate complex diplomatic relations, the outcomes of these efforts will significantly impact both domestic and international landscapes.

China and US need new ways to engage in push for stable ties, Wang Yi says