The US and China are locked in a fierce tech contest that is fundamentally altering the global order, with economic dominance and geopolitical leadership at stake.
Technology has become a defining factor in modern international relations. As countries increasingly rely on technology for everything from infrastructure to national defense strategy, the US-China rivalry has taken on a new level of significance.
China's commitment to technological advancement is evident in its substantial investment in research and development. According to a draft budget report by China's Ministry of Finance, the Chinese government will allocate a significant 371 billion yuan (US$52 billion) to science and technology in 2024 – a 10% increase compared with the previous year.
Besides that, the competition for talent has intensified. The two powers are competing to attract the world's top scientists and engineers, offering many opportunities for innovation.
So, staying informed about this tech Cold War is essential for anyone interested in global affairs. The outcomes of this contest will have far-reaching implications for economies, societies, and the balance of power on the world stage. In this article, we will take a closer look at the key aspects of this escalating rivalry.
An overview of US and Chinese tech history
The tech industries of the US and China have undergone remarkable transformations over the past few decades, emerging as two of the world's leading technology superpowers.
Let’s go down memory lane: the US tech industry was born in Silicon Valley, California, in the 1970s. The region's concentration of talent, capital, and research institutions fostered a culture of innovation that led to the development of groundbreaking technologies like the personal computer and the internet. Meanwhile, China's economic reforms, initiated in the late 1970s, opened the country to foreign investment and trade. This created a favorable environment for the growth of domestic tech companies and attracted international technology firms.
The late 1990s witnessed a surge in internet-based businesses, primarily in the US. Although many failed, this dot-com boom paved the way for future tech innovations. In the meantime, China's rapid urbanization and economic development led to the rise of major tech hubs like Beijing, Shanghai, and Shenzhen, attracting talent and fostering a booming startup ecosystem.
Since the 2000s, the US-China tech relationship has evolved. Initially partners, concerns over intellectual property and security created tensions. Trade disputes made these issues worse, causing the US to put limits on Chinese tech, which hurt trade between the two countries by over $600 billion a year.