This Week's Economy & Tech
New technologies chosen to 'win the future'
Beijing backs future industries, above, driven by cutting-edge technologies that are currently in the incubation stage or beginning industrialization, with significant strategic, leading, disruptive, and uncertain characteristics. The strategic emerging industries chosen last time – batteries, EVs, solar panels – have succeeded because they grasped the future at that time. To develop future industries is to compete for the future”. Creating a cutting-edge technology requires mobilizing entire industrial ecosystems and building out complete industry chains, with companies dotted throughout to ensure capabilities in key materials and components.
US semiconductor sanctions backfire: China’s legacy chip production rose 40% in Q1 to 100 billion, three times its Q1 2019 production, when China implemented its plan to bring chip production in-house. There are no trade restrictions on chips using 28nm or older technology, to ensure supply chain resistance; they are used extensively in cars and basic electronics (e.g. toasters, phones, and medical equipment), and disrupting the supply chain could cause global issues.
Battery companies are trying two paths to expand into Europe and America. One via storage batteries, the other is by new cooperation models of light-asset, low-risk, by licensing technology.
Japan’s dependence on Chinese imports doubled since 2022. Half the Japanese import value for 1,406 product categories comes from China: 1.5x more than the US, which relies on China for only 567 categories.
China's H1 shipbuilding orders jump 44%. That’s 75% of the global total.
US semiconductor equipment companies could lose money for the first time in many years if China sales are curtailed. US chip equipment companies have been charging China far more than TSMC or Samsung, leading to higher margins that account for 60% of their profitability. It could get very ugly very fast..
A commercial startup completed engineering feasibility verification of high-temperature superconducting for its Honghuang 70 tokamak, giving China a first-mover advantage in the critical field of high-temperature superconducting magnetic confinement fusion. Founder Yang used high-temperature superconducting materials to reduce the tokamak’s volume by 98% and cut construction time from 30 years to 4.
A new uranium mine, China’s biggest, integrates automation, remote centralized control and big data analysis from thousands of miles away, with one-click mining and visualization of resource storage, intelligent operation analysis, and precise resource mining. It uses CO2 and O2 in-situ leaching, where uranium is extracted from a solution through closed-loop circulation, without lifting ore to the surface for processing.
Chinese digital and transportation infrastructure is assimilating the 80%
workers in the Global South in the informal sector who pay no taxes, receive few services, have no access to capital and world markets. Huawei and ZTE now deliver more than half the world’s telecom infrastructure and more than two thirds of the market in the Global South. BYD is building EV plants in Mexico, Brazil, Thailand, Turkey and Hungary. The $9,000 EV is today’s equivalent of the Model T for the Global South – a car the average family can afford. That’s as big as the Model T was for the United States. When Donald Trump left office, our trade deficit in goods was $800 billion a year. Now it’s 50% bigger, at $1.2 trillion a year.
