Big Take Asia: The US Pledged to Contain China’s Tech Ambitions. It’s Not Working.

Joe Weisenthal (0:00)

Hey, Odd Lots listeners, this episode you're about to hear is from another podcast here at Bloomberg, the Big Take Asia podcast.

Tracy Alloway (0:06)

And in this episode, you are going to hear about China's efforts to dominate industries of the future. Specifically, it is looking at China's 10 years old made in China plan to see how the country is actually faring when it comes to advancing key technologies.

Joe Weisenthal (0:25)

This episode of Big Take Asia will give you a preview of the next episode of Odd Lots arriving on Thursday, when we'll speak with co-authors of a new Bloomberg report. We're going to be speaking with Bloomberg's Asia government and politics correspondent, Rebecca Choong Wilkins, as well as Bloomberg economic analyst, Gerard DiPippo.

Tracy Alloway (0:41)

They will help us unpack the China 2025 plan and what their research has uncovered. In the meantime, enjoy this episode of the Big Take Asia. Bloomberg Audio Studios. Podcasts, radio, news.

K. Oanh Ha (1:00)

The US presidential election is a week away, and the contest between Donald Trump and Kamala Harris could not be tighter. The two candidates are going head-to-head on everything from the economy to immigration. But one area they agree on is the need to curb China's rise. We've got hundreds of billions of dollars just from China alone, and I hadn't even started yet. But tariffs are two things, if you look at it.

SPEAKER_4 (1:28)

Number one is for protection of the companies that we have here. A policy about China should be in making sure the United States of America wins the competition for the 21st century, which means focusing on the details of what that requires, focusing on relationships with our allies, focusing on investing in American-based technology.

K. Oanh Ha (1:49)

So how is the US doing versus China? Which superpower is leading the race for dominance of the 21st century? Rebecca Choong Wilkins, Bloomberg's Asia government and politics correspondent, says a good way to try to answer this question is by looking at the key emerging technologies that China identified as its priority. Back in 2015, when it announced its Made in China 2025 plan.

And when you look at that plan now, nearly a decade later, new research by Bloomberg Economics and Bloomberg Intelligence shows that Made in China 2025 has largely been a success.

Rebecca Choong Wilkins (2:33)

So of the 13 key technologies tracked by Bloomberg researchers, China has achieved a global leadership position in five of them, and is catching up fast in seven others.

K. Oanh Ha (2:49)

Welcome to the Big Take Asia from Bloomberg News. I'm Oanh Ha. Every week, we take you inside some of the world's biggest and most powerful economies, and the markets, tycoons, and businesses that drive this ever-shifting region. Today on the show, how did China get ahead in key technological advances, despite US efforts to prevent that from happening? Would a Harris or Trump administration change that?

Rebecca says, back in 2015, when the Made in China Plan was announced by the Chinese Communist Party, it was all about helping the country achieve two big goals.

Rebecca Choong Wilkins (3:33)

One is this self-sufficiency, not wanting to be reliant on other countries, and is preparing for any kind of scenario where, for example, China might be cut off from, say, its energy supply or whatever it might be. China more broadly does have a preoccupation or prevailing concern with preserving its own security, so standing on its own two feet. The second is becoming increasingly competitive and in fact, a global leader in some of these key strategic areas. So there's both a sort of inward and an outward element to the Maiden in China plan.

K. Oanh Ha (4:08)

The plan highlighted 10 priority sectors for the nation to focus on, including aerospace equipment, energy saving cars, biomedicine and high end machine tools and robots. And now almost 10 years later, according to the analysis by Bloomberg, China has in fact become a global leader in many of these key areas.

Rebecca Choong Wilkins (4:30)

So those sectors include solar panels, unmanned aerial vehicles, those are drones, graphene which is a coating material that's used in tons and tons of sectors, high speed rail and electric vehicles.

K. Oanh Ha (4:42)

Now does China have any natural advantages that makes it possible that it's been able to take leading positions in these sectors? Or is this simply by design and the will of Beijing?

Rebecca Choong Wilkins (4:53)

Well, it's worth saying that even in 2015, China, as we determined, was already a global leader in three of these sectors, in graphene, in solar panels, and in unmanned area vehicles. So they had a somewhat of a head start in any case. But the other important element here to remember, I think, is that when Beijing does signal out an area for support, when it signals out a key policy priority, it really is able to throw the full weight of its economy, essentially, behind that. So for example, if it decides that electric vehicles are a priority, say, it can ask banks to lend it credit cheaply, it can get local governments to lease it land cheaply, or perhaps even at no or low cost. It can also get large state-owned enterprises to use the sort of full force of its resources, its talents, and direct it towards those industries. So, you know, Beijing has an incredibly sort of powerful basis here, an incredibly powerful set of resources to direct towards these industries when it has selected these priorities.