China’s government plans to build ten national research labs, each with a different focus – for example, an artificial intelligence lab in Shanghai and a quantum computing lab in Hefei – and supervised directly by a member of the Standing Committee, the Communist Party of China’s top decision-making body.
Moreover, the authorities aim to create 100 new tech centres and 100 additional high-tech industrial parks around the country and have introduced an accelerated process for initial public offerings, delivered through the new Shanghai Stock Exchange Science and Technology Innovation Board (also known as the STAR Market).
Local governments also have a crucial role to play in this process. And, already, many are being innovative about how they support technological development.
Many local governments – such as in Shanghai, Chengdu, Hefei and Chongqing – have embraced fund-of-funds structures and begun securing large stakes in ventures. The Shanghai government collaborated with Tesla, and the Anhui government secured a stake in the Chinese electric-vehicle company Nio.
By encouraging venture capitalists to bring potential “unicorns” to their regions, local governments position themselves to get credit for the resulting GDP growth, job creation and innovation. China has already attracted thousands from around the world to fill research-related positions.
BILLIONS POURING INTO SUBSIDISING INNOVATION
To be sure, over the last two years, China’s central government has taken sweeping action to regulate and rein in tech giants in the name of antitrust, social equity and data protection. But, contrary to popular belief, this campaign does not contradict, let alone undermine, the goal of achieving global technological supremacy.
In the long run, appropriate regulation will pave the way for high-tech companies’ robust growth on a level playing field.
The regulatory clampdown has targeted consumer-facing internet-platform companies, including Alibaba, Didi and JD.com. None operates in the cutting-edge areas – such as biotech, quantum computing, artificial intelligence and semiconductors – where China hopes to catch up to the US.
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