China names pioneer team of state firms to take pole position in race to tech’s bleeding edge

Name: Is China’s technology falling behind in the race for its own ChatGPT?
Uploaded: 2024-04-03T04:00:20.000Z
Duration: 8 min 54 s
Description: Is China’s technology falling behind in the race for its own ChatGPT?

China names group of state firms as leaders in drive to develop emerging, future industries and push tech innovation forward

Many are smaller subsidiaries of large central conglomerates, leading some to wonder whether ownership will be a hindrance in the agile industry

Reading Time:3 minutes

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China’s tech industry, seen as a vital growth engine, has been the focus of multiple government initiatives to support the country’s race to the top tier of the global sector. Photo: Xinnua

Frank Chenin Shanghai

Published: 12:00pm, 3 Apr 2024

A select group of China’s state-owned enterprises (SOEs) has been designated as the vanguard of development for emerging and future industries, another step in Beijing’s campaign to break through to the bleeding edge in technologies like artificial intelligence, neuroscience, quantum computing and nuclear fusion to reorient its growth model and counter containment attempts from the West.

The State-owned Assets Supervision and Administration Commission (SASAC) – which oversees 97 large industrial conglomerates – launched a pioneer scheme on Friday for major conglomerates to cultivate unicorn companies and tech start-ups to form clusters and work for new innovations, with the commission promising ample support and resources along the way, state outlet Xinhua reported.

The scheme is seen as the state assets watchdog’s answer to President Xi Jinping’s exhortations to develop “new quality productive forces”, an overall strategy to spur growth for the world’s second-largest economy through home-grown innovation while mitigating the effects of tech export bans and the vagaries of geopolitics.

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Is China’s technology falling behind in the race for its own ChatGPT?

SASAC director Zhang Yuzhuo said at the country’s annual parliamentary sessions last month that central SOEs – those controlled by the central government – will earn 35 per cent of their income from strategic industries in 2025.

Several up-and-coming tech subsidiaries nurtured under their larger state parents within the past three years made the initial round, including China Telecom’s Telecom Quantum, China Aerospace Science and Technology Corp’s Rocket Medical and an AI-powered geological survey company operating under China Coal Technology and Engineering Group.

“SASAC has given a clear mandate that developing emerging and future industries is a pivotal task. While cultivating start-ups and units within their ecosystems, SOEs will also tap external investment and merger opportunities,” wrote Lin Xipeng, an analyst with China Merchants Securities, in a note on Monday.

Hu Yongjun, an official with the State Information Center under the National Development and Reform Commission – the country’s top economic planner – told state media last week it would be urgent for China to plan in advance to be a leader in the global tech race.

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