My Take | US sanctions drive China towards hi-tech self-sufficiency

China’s military budget naturally attracts the most foreign media attention. But if the country is to be lucky to avoid a major war in the coming years, it will be through advances in science and technology that it aims to become the next superpower.

In that sense, its science budget within the latest five-year plan from the “two sessions” is as revealing about its ambitions as its military spending, if not more so. One simple takeaway is that the country aims at self-reliance whenever possible, both in terms of training and promoting researchers and developing advanced products such as microchips domestically.

This stems from tough restrictions imposed by Washington – and some of its Western allies – on the export of advanced chips and other technologies, as well as the targeting – some have called it a witch hunt – of scientists and engineers, often of Chinese ethnicity, in the United States suspected of working illicitly with Chinese government institutions. But even without the American sanctions, the global shortage in computer chips since the outbreak of the pandemic would have forced Beijing to boost its domestic chip-making capability.

In line with the economic slowdown from last year due to the Covid-19 pandemic, there will be a lower annual increase in science spending compared with the last four years, with 7 per cent annual growth being targeted over the next few years. However, the proportion of the budget devoted to basic research will increase, especially in materials science, whose advances are closely tied to the design and making of semiconductors and advanced computer chips.

China aims to boost spending on basic research by 10.6 per cent this year, which will account for 8 per cent of the overall science budget, from the previous 6 per cent. Even so, it is still behind the US with a comparable figure of 17 per cent on basic research.