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Calls for China to intensify self-sufficiency in key technologies follow US President Joe Biden’s launch of the Indo-Pacific Economic Framework (IPEF) on Monday. Photo: Reuters

China’s drive for tech independence gathers pace as US launches new Indo-Pacific strategy

  • Beijing should intensify its drive for tech self-sufficiency, but be careful not to decouple from foreign tech firms and institutions altogether, experts say
  • Improving basic scientific research capabilities, while stepping up recruitment of talent from overseas should be priorities for Chinese policymakers

China should scale up home-grown innovation and talent recruitment abroad to bolster its technological prowess, a move that will help counter a new economic initiative being pushed by Washington, experts say.

Calls for China to intensify self-sufficiency in key technologies follow US President Joe Biden’s launch of the Indo-Pacific Economic Framework (IPEF) on Monday, a strategic grouping among 12 countries in the Asia-Pacific aimed at offsetting Beijing’s influence and restoring US economic leadership in the region.

While China is pursuing technology independence, it does not mean it should decouple from hi-tech companies overseas, according to He Weiwen, a senior fellow at the Centre for China and Globalisation, a Chinese non-government think tank.

“The research institutions and companies abroad did not start the cold war, on the contrary, they hope to maintain cooperative relationships,” he said. “Just like Premier Li Keqiang said recently … we must ramp up the scale of opening up, and we welcome every country that is willing to grow in China.

We shouldn’t discriminate against foreign companies
He Weiwen

“We shouldn’t discriminate against foreign companies, while we need to place a particular emphasis on facilitating communication with them, companies can set up special liaisons to help them navigate any problems.”

Scientific and technological innovation should focus on basic research, such as setting up national laboratories at universities on material sciences and quantum physics, rather than rushing for quick success and making a few lucrative applications, He said.

Talent recruitment from abroad is key to improving tech innovation at home, but China’s hardline coronavirus rules are a big hurdle, said Wang Huiyao, founder and president of Centre for China and Globalisation.

“​​We must vigorously introduce international talent,” Wang said.


US President Joe Biden says US military will defend Taiwan if attacked

US President Joe Biden says US military will defend Taiwan if attacked

“But during the pandemic, we not only failed to recruit international talent, but also suffered great losses, this situation is urgent and needs to be reversed as soon as possible.”

China must attract more international students and talent for academic and scientific exchanges, which have mostly been suspended due to travel restrictions, he said. It must also take part in international rule making, according to Wang, who added the IPEF should be viewed as an opportunity that China can be part of.

The new US-led economic framework includes Australia, Brunei, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand and Vietnam. Together they account for 40 per cent of global gross domestic product.

IPEF is not a free-trade agreement, but a set of standards revolving around fair trade, supply chain resiliency, the digital economy, infrastructure, technology, decarbonisation and clean energy, as well as tax and anti-corruption.

China’s push to loosen US dollar dominance takes on new urgency

Washington wants to use the framework to fill the claw back influence in the region after former US president Donald Trump withdrew from the Trans-Pacific Partnership (TPP), a free-trade agreement, in 2017.

Members of TPP later regrouped and formed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which currently has 11 member nations.

China has expressed interest in joining the CPTPP and experts say the IPEF may not be an obstacle.

“[The two partnerships] have separate agendas, while the IPEF is neither a free-trade pact nor an economic community, it remains vague and it’s unclear how it will turn out,” said He.

“In the Indo-Pacific, or any other region, there is an unique set of rules of integration, and it’s difficult for an outsider to intervene.”

Singapore’s Prime Minister Lee Hsien Loong has expressed support for China’s membership of the CPTPP, as well as Beijing’s Belt and Road Initiative and the Global Development Initiative, the latter of which seeks to support less developed countries hit by the coronavirus.

“It’s far better that China is prospering and engaged in the region than that it be operating on its own outside the rules which apply to everybody else, and not properly integrated and coordinated with the rest of the region, or that it is unsuccessful and poor and troubled,” Lee said in an interview with Nikkei Asia.

“That can cause a lot of difficulty for the region too.”