I'm Robert Lawrence Kuhn and here's what I'm watching: How China is prioritizing science and technology for driving high-quality economic development and, with U.S. sanctions ever present, how technological independence and self-reliance is China's number one goal. It is hard to overstate the importance of science-based business in China's strategic plan to achieve full socialist modernization. The Report to the 20th CPC National Congress called science and technology "our primary productive force" and innovation "our primary driver of growth." Provisions prescribed improving education, systems, strategy, and workforce development.
It is also hard to overstate the disruption to China's science-based businesses caused by the target sanctions, imposed by the U.S. and its allies, on so-called "dual use" technologies, specifically the most advanced microchips and supercomputers. Moreover, according to The New York Times, severe restrictions also apply to U.S.-origin components, technology and software that could be used to produce semiconductor-manufacturing equipment, thus delaying China building its own state-of-the-art fabs to make its own state-of-the-art chips.
China is now making it a national priority to develop its own technology capabilities, with chips as the highest priority. Reuters is reporting that China is set to launch a new state-backed investment fund that aims to raise over $40 billion for its semiconductor sector. It would be the largest of three funds launched by the China Integrated Circuit Industry Investment Fund, surpassing similar funds in 2014 and 2019. China is learning lessons from those prior funds, which had unacceptable waste and corruption.
President Xi Jinping has long called for "indigenous innovation" and Premier Li Qiang has made China's sci-tech commitment abundantly clear, stressing that specialized, high-end, innovation-driven enterprises secure China's high-quality economic growthand stabilize industrial and supply chains.
Speaking at a symposium after visiting three "little giants" – small or medium-sized high-tech companies in sectors of strategic significance – Premier Li said "Innovation serves as the soul" of these enterprises, stressing that the upgrade and transition of China's economy to high-quality development will boost confidence in growth and transformation. He directed authorities to provide more targeted and effective policies, especially financial support, preferential taxation policies, intellectual property protection, and talent training.
It is no coincidence that, since becoming premier, Li has made multiple, high-profile visits to high-tech companies, including Huawei, which shocked the tech world with its advanced smartphone, and BYD, the world's largest electric vehicle manufacturer. It is the way of Chinese leaders to send unambiguous signals to officials at all levels. Here, the clarion call for sci-tech self-sufficiency.
Premier Li has long pioneered the importance of technology, innovation and entrepreneurship. In one of my meetings with Li, when he was governor of Zhejiang Province, in May 2016, Li had innovation and entrepreneurship on his mind, as the next day he would meet 10 new-generation entrepreneurs, telling them that the "innovative generation" is key to industrial transformation.
I'm keeping watch. I'm Robert Lawrence Kuhn.
Script: Robert Lawrence Kuhn
Editors: Xiao Qiong, Hao Xinxin
Designer: Qi Haiming
Producer: Wang Ying
Chief Editor: Ren Yan
Supervisors: Xiao Jian, Adam Zhu
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