From Huawei’s 5G to Jack Ma’s Alipay and Tencent’s WeChat, the plethora of wildly successful Chinese tech companies mean the country is well on its way to achieving its goal of becoming a leading global technological superpower by 2050. Here’s how it’s unfolding
The world’s appetite for new technologies is only increasing, and China is determined to take advantage of this demand and become a leading global technology market. China’s tech landscape has grown rapidly in a short space of time, with its digital economy now accounting for about 30% of its GDP (that’s more than doubled since 2008). As Chinese businesses and consumers embrace technologies such as the Internet of Things (IoT), big data and artificial intelligence (AI), the government is also investing significantly in new technologies to boost China’s global position in science and technology innovation.
China recently set out the core direction of the forthcoming 14th Five Year Plan, which will drive China’s economic development from 2021 to 2025. Tech and innovation have been singled out as being central to this strategy, with a particular focus on achieving national self-reliance through increased research and development (R&D). This emphasis on technology and innovation is likely to create a range of opportunities for UK tech exporters to fill innovation gaps within increasingly sophisticated supply chains.
With a population of more than 1.4 billion, over 100 cities of more than a million people, and 900 million citizens with access to the internet, the potential for the tech sector is huge and presents a big opportunity for foreign tech companies. With important trade links across the whole of Asia, China is a key market to crack for any business with global ambition.
Investment in emerging technologies
A key driver behind China’s rapidly growing tech sector is the government, which has made it a priority to become a leading global technological superpower by 2050. In 2015, it outlined the Made in China 2025 strategy, a national 10-year plan to develop Chinese high-tech manufacturing such as IT and robotics. This aims to accelerate China’s transition from low-value-added manufacturing towards an innovation-based economy.
One in three of the world’s unicorn companies (the term given to privately held start-ups valued at over $1 billion) are now Chinese
China’s government has promoted the development of emerging technologies through a supportive policy environment, establishing large-scale funding of research, and attractive incentives for tech entrepreneurs. One in three of the world’s unicorn companies (the term given to privately held start-ups valued at over $1 billion) are now Chinese. The country also accounts for 50% of global digital payments and three-quarters of the global online lending market.
China now has the second-largest AI market after the US, and PwC predicts that AI technologies could contribute a 26% boost to GDP by 2030. Part of China’s AI success is also down to its vast population, which enables companies to gather and harness huge amounts of data. China’s rapid adoption of AI and data-driven technologies is now a major growth driver. For some sectors and applications, opportunities are emerging for closer UK-China collaboration, leveraging the UK’s deep expertise in this area. The UK’s AI unicorns have now all launched in China.