Big Take Asia: The US Pledged to Contain China’s Tech Ambitions. It’s Not Working.

Episode Summary

Executive Summary: The episode examines how China’s Made in China 2025 strategy has largely succeeded in building global leadership in several strategic technologies, while U.S. efforts have been most effective in advanced semiconductors. It also compares Trump and Harris approaches to China, arguing that national security has become the dominant lens for tech and trade policy.

Main Topics: Made in China 2025 as a strategic industrial policy (Priority: 5/5): The episode explains the plan’s dual goals: boosting self-sufficiency and making China globally competitive in key technologies. China’s success in emerging technologies (Priority: 5/5): Bloomberg research found China leading in five of 13 tracked technologies and rapidly catching up in seven more, especially in sectors like EVs, solar, drones, and high-speed rail. U.S. tools to slow China’s rise (Priority: 5/5): The U.S. has used tariffs, export controls, and sanctions to restrict China’s access to critical technologies, with the strongest impact seen in advanced semiconductors. National security framing of economic policy (Priority: 4/5): The conversation notes a shift from criticizing Chinese companies for wrongdoing to viewing the competition as a national security and military deterrence issue. 2024 U.S. election and China policy (Priority: 4/5): Trump and Harris both support limiting China’s rise but differ in method, with Trump favoring sweeping tariffs and Harris expected to continue Biden-style restraint plus industrial policy. Alternative strategy: 'suction, not sanctions' (Priority: 3/5): One suggested U.S. response is to attract and absorb Chinese talent, innovation, and resources rather than relying mainly on punitive restrictions.

Key Arguments: China’s Made in China 2025 was not just symbolic; it helped mobilize state resources, credit, land, and SOEs behind targeted sectors. Bloomberg research suggests China has already achieved global leadership in 5 of 13 key technologies and is catching up in 7 others. Beijing had a head start in some areas like graphene, solar panels, and unmanned aerial vehicles, but policy support accelerated gains in others. U.S. export controls have been most effective in advanced semiconductors because the supply chain is concentrated and allies like the Netherlands and Japan joined restrictions. China has responded by stockpiling semiconductor equipment, including high-end NVIDIA chips, to prepare for tighter future controls. The policy debate has shifted from trade fairness to national security, including concerns about deterrence and war readiness. Trump’s proposed 60% tariffs on Chinese imports would likely hurt China significantly but could also raise U.S. consumer costs. Harris is expected to be closer to Biden’s approach: industrial policy, supply-chain resilience, and selective national-security restrictions rather than broad tariffs. Some analysts argue the U.S. should compete by attracting Chinese innovation and talent instead of relying mainly on sanctions. Outside the U.S., Chinese products are already deeply embedded in global markets, especially EVs, smartphones, and solar power.

Data Points: Technologies tracked: 13 - Bloomberg Economics/Bloomberg Intelligence analysis of Made in China 2025 progress Global leadership positions: 5 of 13 - China is assessed as already leading globally in five tracked technologies Catching up fast: 7 of 13 - China is rapidly closing the gap in seven additional technologies Head start sectors in 2015: 3 sectors - China was already a global leader in graphene, solar panels, and unmanned aerial vehicles when the plan launched Tariff proposal: 60% - Trump has proposed tariffs across Chinese imports Potential GDP impact: Could halve Chinese GDP growth - One bank estimate cited regarding 60% tariffs on Chinese imports U.S. tech workforce: 3,000 journalists and analysts - Referenced in Bloomberg promotions for its reporting network Plan launch year: 2015 - Made in China 2025 was announced by the Chinese Communist Party in 2015 Semiconductor control escalation: Early 2019 - U.S. added Huawei to the Commerce Department entity list

Pivotal Quotes: "Made in China 2025 has largely been a success." — Rebecca Chung-Wilkins: Summarizing Bloomberg’s research on China’s progress in strategic technologies "The U.S. has sort of three big tools for economic statecraft ... tariffs ... export controls ... and financial sanctions." — Rebecca Chung-Wilkins: Explaining the main policy levers Washington uses against China "Suction, not sanctions." — Rebecca Chung-Wilkins: Describing an alternative approach for the U.S. to compete by جذبbing talent and innovation

Implications: China’s industrial policy has materially changed global tech competition, especially in EVs, solar, and drones. The U.S. is unlikely to stop China everywhere, so future policy will likely mix selective controls, allied coordination, and domestic industrial investment.