Chinese technonationalism, the tool for technological hegemony
Decades ago, the Asian giant launched a strategy called technonationalism. China plans to invest in research and development together with its large technology companies in order to become less dependent on foreign countries. This link between the public and private sectors, together with a plan to influence international markets, has led to great technological growth in the country. Now the People's Republic's leadership in technologies such as 5G is surprising and unsettling its competitors.
Technonationalism, as a term, refers to a technological development strategy based on close public-private partnerships, in which the state is not only a major investor in the areas of research and development (R&D), but also takes an active role as a planning body. In this strategy, a progressive return to the technological and economic protectionism of the nationalist development models of the 20th century can also be observed. Technonationalism is a concept that began to be talked about in the midst of the trade war that the United States and China have been engaged in since 2018 with the imposition of high tariffs on Chinese imports into the United States.
Historically, the Chinese state has been actively involved in the country's techno-scientific development. This interventionism acquires its own values in the Chinese context, where the links between the public and private sectors are stronger than in the West, while at the same time being associated with certain values of national identity. As early as Maoism, the Chinese Communist Party (CCP) sought to innovate in the geopolitical context of the Cold War, devoting most of its investment to nuclear energy. The arrival of Deng Xiaoping and the subsequent liberalisation of the economy reoriented technological development towards market logic. Since then, successor leaders have shown a clear determination to scale up the mastery of high value-added technology production and become less and less dependent on foreign powers. The arrival of Xi Jinping has accelerated this trend, seeking a greater degree of autonomy in the face of adverse scenarios such as the trade war with the United States or the COVID-19 pandemic. In recent years, China has even managed to position itself as a world leader in strategic technologies such as AI and 5G, among others.
The cultural factor linked to national identity is also present in a technonationalist strategy. Technological innovation is closely related to the socio-historical conditions of a country at a given moment in time. In the case of China, two key stages can be distinguished: the Maoist period and the post-Mao period. While Mao prioritised technological development that was more focused on the masses and less on the pursuit of power in the international trade arena, the leaders who succeeded him worked to give China a competitive technological muscle, innovating in strategic technologies and with a greater market orientation.
However, China is not the only country with a technonationalist strategy. The United States, Japan and the Asian tigers (South Korea, Hong Kong, Singapore and Taiwan) have implemented similar programmes since the mid-20th century. In these countries, the state can fund technological development and mitigate the cost of any failure for companies operating in its territory. Many of the leading corporations in the technology sector have had strong ties to the state apparatus and its military industry. This is the case of Silicon Valley in California, the home of technology companies such as Apple, Google and Facebook, the product of the union of US public and private capital, or of some companies in the Chinese city of Shenzhen, such as Huawei, which has links with the Chinese army.
China has pushed investment in different areas to become a leading AI power by 2030, positioning AI as an integral part of the techno-nationalist strategy. In addition, Chinese authorities see AI as a catalyst for upgrading manufacturing and service industries to catch up with advanced economies. To meet these goals, the AI plans and projects developed by China over the past decade are innumerable. Experts in the field argue that China will be the world's leading power thanks to the development of artificial intelligence, which will mark a disruptive change in the world order. This is due to China's advantage in the collection and use of massive data, key in the training of algorithms. In the new McKinsey Global Institute's Global China Exposure Index (2019), it is stated that China's dependence on the world in trade, technology and capital has fallen in relative terms. Conversely, the world's dependence on China has increased. This reflects the rebalancing of the Chinese economy towards domestic consumption and technological independence.
However, in the race to lead in these technologies, the Asian power has certain limitations. In the case of 5G, despite leading the world in the development of patents, with Huawei as its flagship, China is critically dependent on semiconductor imports, a component that has been the focus of US attacks in the knowledge of China's structural weaknesses. In relation to AI, although China has a major advantage in this technology, with access to more data than any other country, the lack of available human capital, as well as limited domestic semiconductor production, is a handicap to overtaking the United States.
In this way, China is increasing its capacity to develop disruptive technologies, although this has not yet translated into an increase in its overall technological capability, largely due to its inconsistent institutional and infrastructural capacity. In the next decade, the technonationalist offensive is expected to be at the centre of China's strategy, both to change its growth model domestically and to continue to strive to become the world's leading power.
