The Great Decoupling: China, America and the Struggle for Technological Supremacy | SOAS

my name is steve sang i am the director of the source china institute before i introduce the subject and the speaker let me just remind you that um if you would like to raise a question or a comment please use the q and a box at the bottom when you do so it will be very helpful to me if you could give information so identified who you are but if you would then like to stay anonymous you can say so indeed please say so and i will respect that and not reveal your identity but knowing where the question comes from will help me to pick questions to push to the speaker if we have a lot of questions to be put the subject is a very important one in the current situation which is on the subject of the great decoupling china america and the struggle for technological supremacy as we are still in an era when the americans and the chinese are feeling increasingly uncomfortable with each other and they certainly are competing in a whole range of areas in particular in the most advanced of technologies and to address this subject i'm delighted that we have nigel inkster who is probably if not then at least one of the world's leading authorities on the subject and indeed he has just published a book on this very title which was released i think at the end of last year in december 2020 nigel is a senior advisor on china and cyber security at double iws in london where he had previously served as director of future conflict and cyber security nigel is of course also a research associate at the sawas china institute and also a director or other director of geo strategy and intelligence had another economics some of you will know some may note that nigel had served for 31 years in the sis the british intelligence service and he retired as assistant chief and director of operations and intelligence in 2006. i think since then he was mostly with the double i double s and has been very generous in sharing his insights and thoughts with various institutions so over to you nigel well steve thank you very much and thanks to everybody who's taken time out to come and listen on this one of the hottest days of the summer thus far um in london at least um i'd like to start with a small disclaimer stroke apologia um in that um when i was asked by my publisher to write this book i had no plans to write it or any other book on china i'd already written one called china's cyber power which looked at you know the ways in which china was using its growing technological capabilities for broader geostrategic purposes and i was wondering whether i would really have anything to add here but this coincided with a period when as steve mentioned uh u.s china relations were undergoing a sudden and dramatic uh deterioration um and a lot of things were being said in the west about china that in my view critically lacked any uh historical or cultural context and so i thought even if from the technical perspective i may not be saying too much that's original it was important to try and write an accessible book that set out the context and sought to explain in a nutshell why china feels driven to behave in the ways that it is doing before then going on to look at you know china's behavior and what uh the implications of that are in particular uh with the united states and viewed very much through the prism of advanced technologies um so one of my main purposes was to address the phenomenon of what uh professor christopher andrew of the intelligence historian of cambridge university has referred to as historical amnesia so i have to say in the case of western policy makers it's less amnesia because that at least implies that you knew something to start with um then those are pretty pervasive uh lack of understanding uh where where china is concerned i'm always you know have in my mind um this image of the great um historian of chinese um technology and science joseph needham standing in the library of his cambridge college keys college reflecting on the fact that the shells were groaning beneath the weight of books about every conceivable aspect of british and european history and yet there was not a single volume about china in that entire collection not a lot has changed i'm afraid um so let's start with the phenomenon of china as a major civilizational power and a major global technology power because for most of recorded history that is what china was um china um accounts for probably 50 of pre-industrial revolution inventions um china's own record of um knowledge uh about technology and not really science but proto-science certainly um is very expensive um and this is something that i don't think anybody really appreciated until the gentleman i just referred to professor joseph needham um began to to study the subjects um and produced a multi-volume uh series um looking at all the different things that uh you know china had done and if you look at agriculture astronomy um civil engineering mining um hydraulics um you know china you know really had um developed uh very significant capabilities and ironically um although china thinks of itself as a land-based rather than a maritime civilization um it was china's maritime discoveries um you know the compass um you know the general design of ships um that that uh basically um um enabled uh the age of exploration that uh china itself uh did not engage in um and the west did and the big question that joseph needham addressed in this multi-volume uh series that he produced on china's science and technology was it has been called different things the grand question etc how come china that was you know in the middle in our middle ages so technologically advanced how come china did not make the leap to the knowledge that enabled the industrial revolution and um this was you know he you know he made the point that to do this what you needed was an application of mathematical hypotheses to nature full understanding in the use of experimental method the distinction between primary and secondary qualities the geometrization of space and acceptance of a mechanical model of reality and you know for better or worse you know the the truth is that china had some of this uh but didn't have all of it and somehow the institutional underpinnings to make that leap towards a kind of truly scientific culture are simply not there and it remains an issue today i remember middle of last year listening to a very interesting speech given by prof um a gentleman by the name of leo yadong who is the chief editor of science and technology daily where he was reflecting on china's technological and um scientific prowess and saying essentially not so fast we need to remember that one thing china never really did was develop its own indigenous scientific tradition and you know for better or worse that that is um the case and of course that reality came home to roost when china encountered the more materially advanced civilizations of the industrialized western nations led by um the united kingdom and this kind of fall from grace and this is the next really thing i i want to talk about you know there's this sense of a fall from grace um is something the impact of which simply cannot be exaggerated in terms of its impact on the kind of collective chinese psyche one can argue to to the end of time about um what china's civilizational history consisted of and whether china was a unitary state um etc etc but the simple fact is that you know for probably the best part of 4 000 years at least maybe longer there was a sort of basic sense of a chinese civilizational state um and for at least 2 000 years an expression of that as a geographical reality albeit you know one that waxed and waned and underwent all kinds of alterations um but the fact is that there was this very very strong sense of a chinese kind of civilizational identity um that saw the world as essentially divided between china and the sinusized states like vietnam japan and korea that were essentially civilized and hence mattered and the rest of the world which they sort of knew about but didn't really care because it was populated with uncouth barbarians like the british um and uh you know really care about them um but this sense that china was you know i mean you know this this term china as uh the middle kingdom jungle is is a very recent neologism china never really used to refer to itself in that way or conceive of itself in that sense um but this idea that china was you know the kind of epitome of civilization uh were was very deeply embedded and to encounter a um a more materially advanced civilization um you know with guns and steam ships and railways um but in china's eyes um um uncouth and lacking in any sense of ethics was a big shock and set off got a massive um drive to secure a modern identity but one that had a distinctly chinese civilizational character and i would argue that's essentially what china has been at for the last 150 plus years and still is you know this really is a kind of key um feature or of um what china's up to and then certainly since the establishment of the people's republic um in 1949 there's been this very sort of strong sense and you know the the chinese term of artists ganchao to catch up with and overtake the west um this was very much uh what um um and then you know this precedes you know um the people's republic um but getting from here to there has been a very difficult process um initially um the arrival of the west encountered a lot of conservative resistance for example trains you know were seen as unacceptable because these you know straight steel lines carving up the landscape was seen as entirely antithetical to to the concepts of feng shui um geomancy um and uh you know there was lots of resistance and it really was a kind of epic struggle between intellectual conservatives and modernizers um to to kind of move uh china uh forward um the situation was further complicated by um a very um difficult set of geopolitical uh relationships i'm not going to give you a product history of china in two minutes uh but suffice to say that um by the time the people's republic was established in 1949 um you know china which um had been uh one of the world's foremost civilizations um accounting probably for about thirty percent of total global economic activity and as i said fifty percent of pre-industrial um revolution inventions uh were was [Music] in a pretty battered state and it got worse thanks to the early administrations of chairman mao whose focus on class struggle as the key link eclipsed any considerations of economic development um and you know led to a series of disasters the great leap forward the cultural revolution um which you know had the effect of stopping china in its tracks and you know science um and technology obviously played an important role there because for most of the maoist era scientists and engineers were seen as you know um class enemies you know members of the bourgeoisie many chinese scientists from overseas came back to join the the people's republic and build a new china only to find that they were subject to you know investigation thought reform and often you know sort of sent down to the countryside to shovel rather than doing anything you know professionally useful by the time of the cultural revolution um the only chinese scientists left standing were those um involved in china's nuclear and satellite programs and even many of them were subject to violent abuse leading to to to their um to their deaths and um the extent you know to which ideology trumped um science and technology uh can be seen from the struggle against einstein that took place in the latter phase of the cultural revolution and is graphically depicted in the um the chinese science fiction classic the three-body problem you know einstein was basically the subject of struggle because his concept of relativity was seen as contrary to a marxist vision of of the universe as uh steady state and infinite um which was of course based on uh no scientific uh assessment whatsoever so anyway china has been through you know a very uh long and difficult process of pursuing a modern identity with distinct chinese civilizational characteristics but it was really only um in the late 1970s after the cultural revolution was put to bed um and xiaoping's pragmatism started to take hold that um china really began to develop its potential um and advanced technology was from the very early stages seen as uh critical for this you know i i first visited china in november 1976 the day after the cultural revolution had formally drawn to an end and it really was um you know to call it backward didn't begin to to describe it um and you know there was a a long way to make up but from the very outset china's leaders were seized of the importance of advanced technology to promote china's economic modernization and this was thanks largely to the writings of one man alvin toffler an american futurologist whose books third wave and future shock um were selling like hotcakes in china when i was there during the early 1980s read by the top leadership and as with all futurologists a lot of what uh toffler said was kind of off the mark and and a bit mad um but when it came to assessing how modern information communications technologies would transform uh human existence he was absolutely on the money and china's top leadership up to and including dan xiaoping bought into that um and even though you know the visitors were at a time when you know when ordinary phone lines were a rare luxury the potential of modern communications was uh very apparent to that of course china had to um [Music] work out how to leverage u.s

technology expertise um i mean the internet didn't come to china until 1996 at least not for general access but prior to that a lot of preparatory work was going on because there was a recognition of how important the internet would be and initially a lot of china's technologies advanced technology success was the product of a close interdependence between the us and china you know china needed the basic u.s technology the software the hardware the know-how and the offer that it was able to make in return was of course the um ability to manufacture um to do low-end manufacture at a scale and cost that no other economy could match you know by just being rather rude about mao zedong i don't want to be rude about him because in his own way he was a rather special person and not everything he did for china was a disaster um under his rule um some some of the very uh important basics were got right in terms of uh literacy education and public health uh so you know when the opportunities um for china arose after the end of the cold war as the next phase of globalization took hold china was um particularly well placed to um to ride that wave and did so very well but as i said it was a joint effort with um with the united states um and you know the extent of that can be seen from the fact that uh um in in the mid-noughties um uh windows xp was the um communications technology of choice for the whole of china the entire chinese government ran on it but it was actually mostly pirated um versions of window xp that didn't get the technology upgrades and when i think 2014 windows you know microsoft decided that they were no longer going to support windows xp they had to make an exception for china because the consequence would have been you know the result would have been disaster have they had they not um had they not done so but china wasn't just helplessly dependent on u.s technology what they also were able to do was to leverage a lot of uh chinese talent that had gone abroad for education had done so to speak apprenticeships at silicon valley and then came back to china and were starting to use their particular skills to develop a range of digital goods and services that chinese consumers were eager to address and this i think is a sort of key to china's success so far in terms of technology um in that it's a combination of relentless um succession of down deerishest planning you know the five year you know the the five-year planning cycle um but beneath that the creation of you know an enabling environment in which um private sector corporations could compete in a in a no holds barred um red in tooth and claw capitalist uh competition um at the end of which um some major national champions emerged whereupon the chinese party state started to move in and you know gradually over time exercise greater control it was a high risk strategy because china was very much aware that the internet while conferring a lot of economic advantages was also a potential vector for ideas and concepts that would challenge the prevailing narrative of the party state and and this was you know a risk they kind of had to be prepared to take but um they very quickly i think moved to get on top of this um through a variety of means um [Music] were able relatively quickly to get you know a grip on control of internet content and we saw a rising this idea of cyber sovereignty the the right enshrined in international law for states to control um the data and information that transited their sovereign cyber space this has not been accepted yet as a kind of aspect of international law but it's something that china has been very very vigorously promoting and it enjoys much resonance particularly in the developing world um and so well china very quickly moved to a position of being what xi jinping when he came to power called a big cyber in other words it it was a a country in you know with which it very rapidly uh acquired a huge user base particularly once um smartphones uh came um into to being in the mid 2000s um and it was um a country that was very quick to develop a digital economy um in ways that were very ingenious um and um [Music] outstripped anything that uh us uh competitors were able to do and you know give you an example ebay the u.s thought that they could run china in ebay as just another branch of ebay everything run from america with no um account taken of the particular preferences of chinese consumers chinese competitors arose who you know like jack ma of alibaba who were very alert to the preferences of chinese consumers and they were very quick to develop a range of services that far outstrip what ebay was able to do and essentially ebay was run out of town and we've seen this with a number of other things with fintech where companies like alibaba and financial and tencent another one of the major chinese digital giants that has emerged over the last few years have provided digital payment service that enabled um china to leapfrog the the credit card all together um and is now already um uh paving the way for china to develop its own digital currency in ways that interalia will enable it to minimize the impact of u.s financial sanctions but inevitably as china got bigger and more powerful so its ambitions um expanded and in my book i i talk a lot about that because i think it's very important to understand what china's kind of um long-term uh vision should be i i i'll come to that um in a minute and as they became technologically more confident so we saw the chinese party state using its growing technological expertise and reach to shape an international environment that was better suited to the interests of that party state and this is where i think geopolitics and culture come into the mix um the us and china never had an easy relationship and it was a relationship that to a very significant degree i think depended upon both sides papering over the cracks and not um and accentuating the positive and not belaboring the very significant differences that existed between them i think this is very important you know to get this in context because there has i think arisen within the united states in recent um years in the last couple of years at least this narrative that um us engagement with china has been a failure rather than creating a china that is a benign international presence um that is very much a status quo power um and you know um one that can be expected over time to converge with international norms that have been dictated by the victorious western powers after world war ii instead engagement has created a kind of frankenstein's monster if you like you know an ideologically hostile state that is uh revisionist and um um you know in in the sort of worst imaginings of you know some of the hawks and the trump administration uh aspiring to take over the world um and displace the united states as the number one power um well we can discuss all of that uh in the q a what i would say is that it's important to remember that the us engagement with china was not by and large um built on this sort of polyanish expectation that everybody would join hands and march together towards the sunlit uplands but rather on a more hard-headed uh set of uh pragmatic um calculations um the the that were you know much less uh focused on the expectations that china would um in inverted commas become more like us that was a relatively late um kind of conceit which i think was you know fed very much by um the commercial the u.s commercial

community for its own reasons um but the simple fact is that um there is you know that you know you can track um the process by which um the u.s and china have um experienced parting of the ways and in the book i highlight three key dates um which are firstly 2001. that was the year in which china was admitted to the world trade organization on a developing nation basis um at the time that seemed like you know a highly desirable thing and there is no question that china's accession to the wto turbo charged its economic growth you know that that was a period when we saw you know year after year um high um two-figure digital um uh gdp growth you know year in year out um but um was problematic because um well simply because an economy of china's size that was still very much a closed economy has had the effect um i would argue of bending the whole world trade organization mechanism out of shape it was never designed to cope with an economy that big that wasn't you know uh prepared to move towards playing by the rules so to speak and i'm happy to you know sort of pick up on that and you know talk about it further in q and a the second key date was 2008 the global financial crisis um notwithstanding the fact that china was at least as much responsible for this crisis as the united states um for china's leaders this was seen as a kind of moment of epiphany you know the the you know proof if needed that the washington consensus um was a false god uh proof that the united states could not be relied upon prudently to manage the global economy and i think they had a point there um and um that if china was to avoid the very deleterious consequences to its own economy of this particular crisis and they were um that it would have to strike its own path and then of course the third key date was 2012 when a certain gentleman by the name of xi jinping was elected secretary general of the chinese communist party replacing uh hujin tao who um was a very different uh personality um all together um and i think you know the these three milestones if you will um you know help us to sort of track um the beginnings of the dramatic changes that we have seen between the u.s and china in recent years um and in particular uh i think we um um you know the the impact of xi jinping as a leader cannot be overestimated it's worth saying a couple of words about him because i do you know touch upon him quite a lot in the book um and you know she's an interesting character um his father xi jong shin was one of the founding fathers of the party but fell foul of mao zedong and spent a lot of time in um in in custody of various forms xi jinping himself was rusticated uh to remote uh rural um chancey during the cultural revolution um and it doesn't get more rural than remote rural chancey um and yet notwithstanding uh that um rather than seeing his you know not notwithstanding the fact that his family was persecuted by mao notwithstanding this um rustication to the countryside rather than undermine his faith in the chinese communist party it seems to have reinforced it to the point where i think she made 10 unsuccessful applications to join the party before he was finally allowed in um and you'll see in your um i guess you you'd have to call him a princeling you know as in one of the uh sons and daughters of the founding fathers this group of uh people who are not particularly homogenous or tight-knit but um you know have been brought up uh in the conviction that the chinese communist party had earned the right to rule china and that they the sons and daughters of the founding fathers um have the right to derive benefits uh from this and as my grandmother would have said and in many ways c jinping's no better than he should be but compared with many um people um in in the party at the time that he took over is actually relatively puritan in terms of his inclination he took over the party at a time when um the the the the good days you know the the the high rolling uh fast uh growth um era had led to a pervasive uh culture of um corruption uh within the party that he saw as um potentially terminal for the party's future if not addressed and he also inherited the chairmanship of the communist party at a time when the chinese economy was in the hands of some very powerful vested groups who stood in the way of reform and further necessary modernization so he was appointed with a remit to kind of clean things up but nobody quite expected the spanish inquisition which was what they got in the form of a very pervasive um and continuing anti-corruption campaign that usefully enabled him to mop up all his major opponents knowing that everybody's hands had been dipped in the blood and also a dramatic reinforcement of party orthodoxy and doctrine and you know we we you know we're saying we you know i know i've lost count of the number of important speeches uh that xi jinping has been made on um aspects of uh party dogma um you know the number of uh dense and impenetrable books that he has uh written on the subject um but it you know it it is absolutely pervasive and kind of all consuming but one of the things that xi jinping was very very big on was again grasping um the um importance of technology um and bringing it under control because you know the 2000s where china's technology concerned you know they had seen a dramatic expansion of capabilities but in kind of wild east conditions with very little in the way of effective regulation um a focus on content control at the expense of actual technical security so china when she took over found itself with a large sprawling very lucrative um cyber domain but one that was um regulated poorly if at all and was very uh vulnerable to um outside um interference and attack to the point where you know russian uh cyber criminals were regularly using china as a springboard for their exploits because it was so easy to get in um and she took this all in hand and began to set in place um meticulously over time a regulatory environment um for the cyber domain and for cybertech and for advanced technologies together with you know a further relentless drive to become what he termed a strong cyber power but also um to set out centenary goals um which envisioned china becoming the leading global technology power in the world by 2035. um and we saw a variety of plans things like made in china 2025 um we saw um [Music] national uh telecommunications champion huawei deployed overseas to develop um mobile networks um in countries all around the world and to become a leader in fifth generation mobile technology and at the same time we've seen china moving to um you know to aspiring to a dominant position in global technology standards in a variety of different technologies starting with but by no means restricted to 5g because china is well aware that if it can get its technological standards accepted as the global norm it can then leverage its unique um combination of manufacturing capacity and economic power to really achieve uh domination in in you know globally in these technologies and there was a huge amount to play for and china has also appreciated that it can use its dominant position or is growing dominance in technology to shape global norms rules in relation to how these technologies are employed so you know um we see china very active in uh international discussions on cyber governance promoting ideas like cyber sovereignty um and we see china very much engaged in uh global discussions on cyber security again you know promoting very much its own uh vision of how things should be and this vision is very broad and all-encompassing um it's encapsulated in a phrase that seems bland to the point of innocuousness you know the community of common destiny for mankind who could addre who could object to that you know what curmudgeon what you know sort of scrooge figure could object to an idea like that but uh deconstructed it turns out to be essentially an idea for a a chinese-led world order led in a very different way from how the british did it in the 19th century and the americans in the 20th century but a global order led by china um nonetheless um so yeah um and you know this you know china's technology has been shaping uh uh china internally uh in many uh you know dramatic ways uh we've seen for example how technology within china has been used for purposes of social control and to enhance national security which under xi jinping has become all encompassing there is no facet of human existence in china that does not come under the rubric of national security under xi jinping but um you know i mean we've seen the emergence of china china you know turning into a kind of techno-security state with a variety of uh surveillance uh mechanisms in place like skynet um you know that that provide uh um wide-ranging um visibility of actions of ordinary citizens you've got this concept of um um that sorry i had a mental blank about what it's called um after talking so long but um you know there's a social credit uh concept which is often misunderstood and misreported in the west but essentially seeks to use uh awareness and knowledge of people's digital and offline activities uh to incentivize good behavior and sanction bad and of course we've seen um the the the um xinjiang um turn into a kind of test bed for all these and other uh surveillance technologies many of which are you know enabled by by uh western counterparts so two more points that i want to make and i'll sort of shut up and uh you know leave the floor open for questions in the last couple of years we've seen the us mounting a pushback and that pushback has been quite brutal in its intensity china though very advanced is um highly dependent on some key areas of u.s technology in particular the most

advanced um advanced logic microchips um you know in in the sort of set you know sort of 14 to five nanometer range not that those figures really mean very much um and um essentially the usa has found you know it has been um um able to deny china access to these most advanced microchips because everywhere that makes them and there aren't many places um does so using equipment ideas intellectual property that is american so the american government can can prevent uh this uh from happening um and this has really led uh china a to conclude that the united states is determined to constrain china's rise which i think now is a pretty correct and obvious conclusion and that china has to redouble its efforts to um detach itself from dependence on u.s technology whilst at the same time stealing as much of it as they can lay their hands on or buying it where that possibility still exists but what the usa has done is effectively stop the 5g national champion huawei in its tracks um and it's also um cramped the style of a lot of other prominent chinese companies that still rely on u.s technology um but it's not that simple because at the moment we see a biden administration that has maintained in place the various measures imposed by uh trump um and is trying to orchestrate a more coherent pushback against china than the trump administration uh was able to do but the united states has to contend with two very powerful constituencies in its own um country that are opposed to this one is wall street the other silicon valley and in particular i think silicon valley there are those like um eric schmidt the former chairman of google who now take the view that the united states needs to adopt a strategic approach to the challenge stroke threat from china and accept that from a technology perspective some parting of the ways is both inevitable and desirable but i can assure you that uh the vast majority of opinion in silicon valley um goes in the other direction and continues to favor the closest possible technology collaboration with china both for re you know for for financial reasons but also because of philosophical reasons there are still many in silicon valley imbued with the ideals of the founding fathers um of of the internet um and this you know of course the the discipline and you know we also have to take into account the reality that in all in areas of advanced technology which are now the subject of this intense competition between the us and china whether it's artificial intelligence robotics you know biotechnology all the achievements that have been registered to date have in varying ways been the result of collaboration between the us and china unraveling that is a pretty big ask and um has very uncertain consequences and this is what i try to address in in the final section of the book you know getting to the finally getting to the point in the title the great decoupling there's this parting of the ways uh between uh the uh us and china which is beginning to look more of you know um fundamental and and more critical to to how the world will evolve in in the coming decades um and it's very difficult to say how that will play out and it's very difficult to know who's going to come out on top i'm often asked to draw a comparison between the us and china when it comes to all these technologies um and you know it is very difficult to do but the short answer is that the united states enjoys the advantages of incumbency so to speak they got there first and have a deeper base and um greater strengths much greater strengths in foundational science which is still very much of a weakness where china is concerned china on the other hand has shown remarkable ingenuity and innovation in the application of existing technologies but it goes beyond that ten years ago i could have conversations in silicon valley or in wall street with people who say well we don't need to worry about china because they can copy but they can't innovate well i think people have got the message now because china is showing a capacity uh to innovate and not just in you know the lower order technologies but in some of the very much higher order technologies like for example quantum encryption where china is clearly you know um leading the global field under professor pangenwei uh a remarkably brilliant man the youngest member of the academy of science you know ever and he definitely deserves uh to be there but we're also seeing you know remarkable innovation in in lots of other areas and it's certainly no longer the case that the west kind of rules uh the roost um here um the united states has its own problems its own education system isn't really producing the sort of educated uh um people that it needs so it has to continue relying on people from outside uh and it's been able to attract some of the world's best talent but now no longer so much from china um because relations have deteriorated to the extent that they have um so i mean i can talk a lot more about you know who's up and who's down in relation to uh particular um technologies if uh you want me to do so but my sense is that you know the parting of the ways is starting to happen it's going to be slow it's going to be uneven it's probably a process that will never be completely um you know it will not be a process that has you know a clear end point um but the implications are probably that everybody will end up losing to some degree because um if we end up with um more separation less integration less collaboration i'm pretty sure that translates into less innovation over time and it's also created um particularly some very difficult geopolitics and this is where of course taiwan comes to the fore because taiwan semiconductor manufacturing corporation has kind of cornered the global market in the production of the most high-end advanced logic chips under production nobody in america makes these well actually that's not true because intel does but it's fallen behind tsmc in terms of what it what it can produce um most american chip designers have outsourced manufacturer for reasons of economic logic china can't make the most advanced microchips you know there's several generations behind the usa in both design and production this puts taiwan in a very very interesting position indeed as the source of the most sought after and most desired um microchips on the planet 100 miles away from the uh coastline of china and the subject of chinese irredentist claims that could um before too long um be prosecuted um with military means so that i think is kind of emblematic of the sort of challenges that um we you know confront um in in the 21st century um and it is very much a two-horse race between china and the usa it is a contest that is driven by uh values and ideology as much as by raw power you know xi jinping has said you know there's a kind of there's a disjunct in china's um discourse on this because you know the diplomats talk about uh china you know only wishing to achieve a motive for vendi uh with the rest of the world xi jinping in speeches to the party faithful is saying that the world is in a contest between capitalism and socialism and socialism must prevail so um you know there's no doubt that this is a contest from which neither side seems likely to back down advanced technologies are critical to this so i've come in pretty much on the hour i think steve and i wanted to leave time for questions so i'll end it there well thank you very much um nigel for this fantastic and thoughtful talk i wanted to press you a bit on the three key days that you put forward because the wto days the quick financial global financial crisis date and above all the date when xi jinping became leader yeah it comes it came across to me that of the three days in the narrative the last was the most important the first one kind of opened the door for china the second one was the date of awakening but the third was the date when things really changed yeah yeah i agree entirely with that steve um certainly what xi jinping was doing when he came to power was a continuation of trends that were already starting to become apparent you know we you know we we saw under gujan tower that china had you know in terms of his international relations moved away from hide and by you know this strategy of dang xiaoping lilo you know so keep a low profile you know don't take a leading position etc etc china had moved away from that um though it had not formally acknowledge this to be the case um and relations with the usa were already and the west more generally were becoming more tense but i think you know the the arrival of xi jinping did kind of crystallize um these uh emerging trends and kind of supercharge them um and it's very much i think the case you know you know that i mean people often ask me do i think xi jinping really is a communist and you know my reply is actually yes i think he is a true believer i think he believes that communism has got china where it is today and um you know it you know uh communism will get it to where you know he wants it to be the realization of the chinese dream uh so i think he really you know he really where whereas you know under hujin tower membership of the chinese communist party was coming to be seen as just another line in the cv you know um you know the the the thing that would tip the balance between you and the other guy if you were interviewing for a job you were a party member he wasn't you'd get the job that was about you know or all you know um in a mountain to nobody really you know took it and took it that seriously but under seating thing this has you know we've seen this remarkable transformation in terms of you know the way in which ideology is at the forefront of everything okay we have quite a lot of questions so um we could sort of tackle them briskly uh the first question i think comes from johann charcoal from sawast how does xi jinping's politburo define technology is it largely focused on computing and communications the plc still has trouble mastering the jack engine is that at the same priority level as the building of their own microprocessor i've also heard claims that china has embraced building a state a space-based economy along the lines being drawn up by gerald o'neal and pursued by jeff bezos do you take them seriously oh absolutely seriously yes you know china china you know china you know china is aiming for uh global dominance in every uh area of uh scientific achievement i mean i just the other day read a speech that xi jinping gave on science and technology to the science and you know scientists and engineers um of the academy of science and the academy of engineering and you know it is a remarkable um you know list of achievements in all areas of technology including you know aviation industry i know china has been struggling to produce its own indigenous uh jet engine and that's proven to be one of the more difficult things um and you know its progress towards all of these technologies is going to be uneven because that isn't the nature of these technology you know some sometimes you know what seems like a promising start turns out to be you know a blind alley and you have to kind of go back to the drawing board um other things suddenly you know uh leap ahead when you you you didn't think that um they they were going to um but she um in in um in in in this speech you know makes you know there's an absolutely compelling case for um the achievements the very real achievements that china has registered in all areas and you know a very ambitious um uh statement of where china needs to go so the short answer is it goes far beyond just information communication technologies it encompasses every area of advanced technology and i think it is emblematic of the way in which these things are taken seriously that last year the politburo devoted two whole days two whole days to the study of blockchain i can't think of any other uh government in the world that would ever do anything like that but blockchain is obviously important to china because they see it as a key to a successful development of a digital currency a way out of uh you know about from under the um you know the grip of uh the us uh dollar um and and the message you know the relentless uh message from um china's leadership is its foot to the floor in all areas um of uh technological development this is front and center okay next question i picked comes from uh somebody who would like to stay anonymous and he thanks to he thank you for your fantastic talk you spoke about how with china's drive for technological advancement china can increasingly shape global rules and standards on cyber governance security etc this may result in a china-led world order but this world order would be led in a different way compared to how the uk or the u.s did could you please explain further how china would lead a world order in a different way yeah now it's a very fair question and um yeah i think i can explain it because i'm in good company because i just read a lengthy uh report by the rand corporation looking at exactly this problem um and and the authors of that seemed broadly to agree with me which you know um elicited a huge sigh of relief as you can imagine um but i think you know china's looked at um how britain ran the world in the 19th century with colonies expensive um the natives aren't very friendly sooner or later they you know they get uppity and want independence um you know more trouble than it's worth they've looked at the us model of um global hegemony 800 military bases scattered around the world you know very expensive very demanding um you know we don't want and they they've decided very clearly we don't want to go down this road so i think what they're you know what what uh beijing sees as the way forward is um through primarily um economic and technological means and we see this already in how china deals with other countries displease them and you get cut out from access to chinese markets um australia knows all about that you know other countries have experienced it to varying degrees um you know play ball and you know we'll give you some you know sort of um economic uh you know benefits and uh you you can you know have our technology you know do do what you like with it and all we really want you to do in return um is not piss us off yeah don't you know uh allow you know some anti-chinese activities on your um soil um you know send us back our dissidents when we ask you to um you know don't allow your newspapers to write rude things about china and uh we'll get along famously um i think in essence is is what what they kind of what they envisage it is i mean i you know i know people talk about you know the tributaries you know the tributary system and of course they never you know there was never anything really called that at least not by the chinese you know with the term we coined um but you know something something a bit like that you know where where where you know the chairman of the communist party sits facing south to use the daoist uh um analogy um [Music] and uh everything works because um you know it it's all you know the world is harmonious and ruled ethically okay next question comes from mikhail theolog china is displaying a superpowers ambition until recently it was believed that china would seek an expanded regional road they reduced u.s road but would defer to the distant future any global ambitions now however the signs are that china is gearing up to contest america's global leadership and this is becoming unmistakable and they are ubiquitous do you agree partly not all together i think that china's leaders are realistic and then you know their primary concern is is to um secure effective control of their own backyard um so um i mean china looks at the world in concentric circles um and i think what what they want to do first and foremost is get america you know out of their your backyard you know out of the first island chain and preferably out of the second island chain um if they can or at least with a very much reduced presence um and uh and impact that is you know i think where where where their immediate uh priority uh lies um certainly um you know that you know maybe you know the chinese leadership have made it clear on multiple occasions that they no longer see the u.s led global order as fit for purpose in the 21st century they you know make the point quite legitimately that it was uh you know um um put together by the usa and its allies in the aftermath of world war ii and reflected you know western norms um and values and failed to take account of uh you know other ways of of looking at the world um all to varying degrees true um and what china is you know and it's been a world war that's been characterized by um armed blocks and alliances um you know um and what china is proposing is something much more benign uh much less belligerent um and something that takes more account of what they call diversity by which they mean different uh political uh and cultural um perspective and all these things you know to varying degrees you can can be said to you know to to be true but you know there is obviously a downside if you uh reject um universal values uh which china explicitly does um you know that that that that can be can be problematic so i think what china wants you know you know is as much uh global influence as possible but this reminds me of a conversation i had with uh the then state councillor davinco back in 2007 and you know he he was still sort of chanting the mantra of you know hide and by you know china has no ambition status quo power etc and i said well you know state councillor uh you're acquiring you know global interests and uh um um global you know you're just getting more you know involved in the world generally um and you might want to bear in mind that you know the british didn't uh set out to you know paint a quarter of the world pink it all happened as a result of a dynamic we got caught up in ended up with us doing all sorts of things we'd never planned or wanted to do like ruling india um and i suspect state councillor that you will find yourself in a similar dynamic and once you do there's no knowing where you end up so i think this is very much the situation where china is in at the moment they have got a fairly strong sense of how far they want their immediate reach to go but the problem with power is once you've got it and you exercise it you know it kind of runs away with you okay you you mentioned taiwan in your answer so i'll pick the question next which i think very specifically about the taiwan issue and this comes from graham leslie in cardiff do you implies that china wants taiwan not just for political reasons of unification but also for economic reasons to ensure that it can lay his hands on the most advanced microchips the spiner wished over time to have his own china controlled internet to have his cyber sovereignty as it were yeah okay well there's more than one question there so i'll break it down um i think where taiwan is concerned for the chinese party states um you know the this is a matter of honor and it's also you know a matter of real politic because um the ability of the party state to um you know realize national reunification is an important part of its claim to legitimacy now if you know it's got hong kong back it's got macau back but taiwan still eludes it and unfortunately for them taiwan's moving in the opposite direction fewer and fewer taiwanese want any part of the mainland and they certainly no longer believe in one country two systems um so it's it's getting uh getting more difficult but um you know fukudiris um said that the drivers of uh conflict are fair honor and advantage for us getting misque philos and that's as true today as it was 2000 whatever it was years ago when the pedis wrote it um and you know i think you've you know fear honor and advantage are all there in the taiwan equation both for china and the united states um and china's behavior is driven by by all of them fear that if they don't get uh taiwan back you know they're never going to be able to um exercise effective control of the waters in their backyard fear also that their credibility could suffer you know um if they don't make good on their on on their commitments but also yes benefit uh does come into it it's not quite that simple because even if china were able to take over intact uh the tsmc foundries and that's a big if i'm not sure america would countenance it um that still doesn't mean that they've got the design skills to actually design the high-end chips that tsmc is there to make and much would also depend on the extent to which which if any tsmc skilled staff were there to um to make them and it's not just that either because you know this is a process that involves enormously complex uh supply chains the silicon the chemicals for the etching and of course you know the the technology for for the advanced extreme ultraviolet uh etching uh uh techniques so um just getting hold of the tsmc foundries even if all the machinery was intact wouldn't necessarily be a panacea for china's uh china's problems but on the last part of the question you say does china want its own internet well to all intents and purposes it already has one i mean the the chinese internet is in many ways a kind of self-contained phenomenon uh similar to but in some ways very different from the internet that we in the west um are are familiar with and and you know i think you know can be characterized as very much its own kind of uh you know sort of um cultural zone you know with its own more as its own you know terminology um you know um you know it it is already very different and it is largely i think the chinese party state have achieved uh technology dominance over the chinese internet doesn't mean to say that people can't say things they don't want them to but they can you know sort of stifle um unwelcome discussions very quickly uh if the need arises and you know if need be they can go and find the people making um um you know disobliging remarks and uh make them an offer they're not going to be able to refuse okay we got plenty of very very good questions so you could give them very quick answers that would be fantastic next one comes from philip mead how will the great e-coupling impact china's ability to innovate without u.s collaboration how does china's

education system itself lend itself to the creative creativity required to innovate and do you think that decoupling will encourage china's to resort more to covert activities such as cyber hacking espionage and intellectual piracy field the war yeah well on the last point it is actually quite hard to imagine how much more they could do than what they're doing already but yes most certainly i think it would lead to more more of those activities no question about it you know um what china cannot get um legitimately in inverted commerce it is going to seek to acquire illegitimately also in inverted commerce because these things are not straightforward um i think you know there is again this pervasive myth in the west the chinese education system is all about rote learning and you know the the poor ideas can't think for themselves and it's really not like that at all um yes of course the formal exams require a lot of rote learning and uh yeah um particularly the ones this year celebrating the centenary of the communist party um but um you know chinese people can of course think for themselves can be innovative creative and there's plenty of evidence uh to suggest that so i don't think that all of a sudden you know this is this feels like the reverse of the argument that the changes he made in the 19th century that if we you know deprive the barbarians of their rhubarb their intestines will seize up and you know we'll have them where we want them uh it's not going to be like that but the point is that you know innovation benefits most from international collaboration and um where where an international exchange of ideas and where that is reduced you know uh innovation will be okay um next questions comes from ham jan you did say that uh decouplings will make both u.s and china lost question is china had almost a free ride so far in engineering's technology transfer purchase theft western universities etc if this fee rise stops which looks likely can chinese develop their own technology really efficiently at reasonable cost and market it credibly if this is not possible will china not be the greater loser well you know we can we can't say uh for a certain one way or another you can't predict the future but um i don't think it's necessarily the case i mean the fact is that if you look at technology around the world um china you know has um very significant um engagement um in both developed and developing uh countries but particularly in the latter you know the chinese technology offered to these countries is something that they find genuinely attractive for all sorts of reasons and when you look at efforts by the usa to to impose things like you know the clean network uh initiative you find that um you know countries who've signed up pay lip service to it but aren't really sort of taking it all that seriously so i mean i you know um i think china can and will develop um its own technologies and b i think that um the way which it can deploy and market those uh internationally will be and is already uh very effective it doesn't mean that you know everybody's going to flock to chinese technology everywhere um but i think china is in with a fighting chance um and i don't think it can automatically be assumed that um china will fall behind the usa will search ahead i think i can see a future in which things take the opposite path you know we we've just had four years of a us government that's fundamentally anti-science and has defunded a lot of u.s original research work you've got a u.s congress that seems uh determined to regulate silicon valley through what looks to me like a lot of the wrong sort of regulation in contrast to china which is regulating its own tech sector through what looks like the right sort of um regulation so you know don't take it for granted that the united states will carry seamlessly on its current trajectory okay next question i picked comes from the facebook feed from kanchana raman nunjam despite its technological advancement why does china lag behind in the microchip area and what will it take before it can catch up that's a very good question and the short answer is nobody knows if they knew that it sorted it out by now but this goes back a long way um back in the 1960s china was probably about where the usa was in terms of um semiconductor technology and then you know the the intervention of the cultural revolution basically decimated china's um um emerging nascent um uh indigenous uh sector there he completely you know uh uh uh obliterated it and you know things like that you know carry a long tail uh and i think china is in part suffering uh from from that um what else um um i mean you know the the different technologies can be acquired by different means you know some you know to be put bluntly some are very easy to steal and copy microchip manufacturer is not one of those because manufacturing designing and manufacturing microchips requires what the germans call fingerspitz this kind of innate intuitive knowledge that only comes from constant engagement and uh you know learning by doing so if you're not doing that you're at a disadvantage um so i think these are some of the reasons why why china is uh still um behind we've seen a lot of uh efforts by the chinese state to throw money at the problem and most of this hasn't worked i think it may in time uh but this is one of the more difficult technologies as i said you can't just get a little get the manual and you know take it from there next one i'm combining uh two sets of questions but they are all related to standards uh the first one comes from somebody who prefers to stay anonymous and she said that she's always a bit confused by this tenders conversations could you give a couple of examples of standards and the technologies that this applies to and perhaps how they differ between the us and china related to this is a question from a source student murray stokey do the national champions also promote technical standards and norms such as internet certainty abroad how resilient is the chinese private state nexus in activities abroad yeah okay well um the the answer to the last question is very you know there's the the the state and the private sector you know um have been working together very well but it's it's less so now because i think that um in in recent uh uh times um some of uh china's big tech entrepreneurs have been brought to heal by the party and reminded who's really in charge um and that i think has crimped their uh confidence uh somewhat uh but broadly speaking the chinese party state is able to get uh its private sector do to do what it needs it to do um so i i don't think that is going uh going to change um in terms of standards well i think um 5g is the obvious one to point you know well you know let's look at one one area where standards kind of work and and where they don't um one you know is ordinary electrical appliances um you know now you know there there are no sort of global standards for electrical appliances when you travel from one you know uh part of the world to another you know none of the plugs match you know they're all different and you've got to you know if you're if you're traveling a lot you've got to have you know these huge adapters that you know sort of enable you to plug in you know all sorts of different sectors but on the other hand take um information communication technology you know there is you know so one set of plugs that work for all computers and all smartphones you don't have to carry you know lots of different ones with you and adapters every where you go and that's because there has been effective international agreement on what these standards should be now it's not one that particularly affected china because it was a usa that was the dominant factor but let's take 5g where the national china's national champion huawei has been filing patents on 5g like there's no tomorrow has been very heavily involved in all the international uh negotiations on 5g standards um and has therefore you know been very effective at shaping uh these standards in ways that uh you know reflect its own emerging you know technologies and and and capabilities um um it is just a kind of you know virtuous circle uh where huawei has been concerned in relation to 5g so that is an example of how you you can do this okay we have one minutes left so uh one last uh question from us phd student uh malacca robinson is this u.s china tech competitions primarily an ideological battle rather than a technological or economic conflict i would say yes uh in a word um the the the uh that it's at the bottom of this you know it's about raw you know geopolitical power it's about technology domi

2021-06-18 15:19

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