How Beijing is going to win in the confrontation with the West.
According to Western experts, the Chinese company BYD will produce more than 2 million vehicles powered by alternative energy sources this year and will leave the U.S. Tesla far behind. Last year, BYD increased its output of electric cars and hybrids by 211 percent; about the same growth is expected this year.
Chinese automaker Geely produced 251 percent more electric cars in 2022 than the year before, while Changan produced 134 percent more. Tesla was able to increase its production by only 40 percent, and German Volkswagen by 10 percent.
Tesla, faced with fierce competition from the Chinese, is forced to reduce the price of its electric cars for the third time in order to avoid being pushed out of the largest Chinese car market.
Overall, China produces more alternative energy cars than the rest of the world. What does that mean? It means that no "green transition" outlined by Europe would be possible without China. BYD hasn't shown much interest in foreign markets yet, but that could change overnight. Especially since other Chinese electric car manufacturers, including luxury ones (such as Red Flag) and electric supercars, are already successfully selling their products in European countries. Even Chinese electric buses are supplied to Europe. In order to replace internal combustion engines according to the plans existing in the European Union, they will simply have to buy Chinese products. Especially since they are much cheaper, and the technical characteristics are not inferior to Tesla.
It is also important that the Chinese have almost complete control over the market for the production of electric batteries, and also part of the raw materials for their production. And the batteries are the most expensive and important element of an electric car. The main indicator, i.e. the mileage and fuel efficiency, depends on its technological effectiveness.
The U.S. also wants to build an economy based on clean energy. But they can't avoid China, as well. For example, Ford is relying on China's Contemporary Amperex Technology, the world's largest battery manufacturer, to build an electric car battery plant in Michigan. This is just one example of U.S. dependence on China, which did not begin yesterday.
Previously, much of the research and development of clean technology was done in U.S. laboratories, but U.S. companies often turned to China to convert these products into commercial offerings. And times have changed. Over the past decade, the Chinese government has invested hundreds of billions of yuan in subsidies to support the production of environmentally friendly products. China accounts for at least 60 percent of the world's capacity for solar panels, wind power system components and batteries. If you want to develop, go to the Chinese.
These days, at the ongoing Shanghai Auto Show, the same company, BYD, presented production samples of electric cars with sodium-ion batteries. And this is the breakthrough the world has been waiting for, which will provide the Chinese manufacturer with an undeniable competitive advantage. The fact is that sodium is about 50 times cheaper than lithium, which is now more often used to make batteries for vehicles.
Only God knows what other surprises are in store in the Chinese automotive industry. After all, the automotive industry is a cluster of scientific and technological progress, an indicator of the level of technology and production development.
Meanwhile, Chinese scientists are the most advanced in curbing the steady thermonuclear reaction. Their thermonucleus "burns brighter and shines longer" than anywhere else. The Chinese plan is to have an experimental thermonuclear power plant by 2035, which will usher in an era of limitless energy, and commercial operation of such plants is scheduled to begin by 2050. How the West will be able to respond is not yet very clear.
There is currently a debate in the West about whether to develop artificial intelligence, while China has already put in place a national AI development plan, intensifying work in this area. This extensive program, called Artificial Intelligence for Science, is overseen by China's Ministry of Science and National Natural Science Foundation. According to China's Xinhua news agency, "the plan aims to force the use of AI capabilities to achieve scientific and technological breakthroughs in key areas of science and technology, such as drug development, gene research and biological breeding." For sure, the plan will not stop there; it will also include research in thermonuclear technology and military-technical sphere. In Russia, about 3 billion rubles, or about $40 million, was allocated for developments in the field of artificial intelligence in 2020, in the U.S. - about $6 billion, China - $14.3 billion.
China is betting on AI as one of the leading factors in economic development. Having created the world's most powerful supercomputers, Chinese researchers are working intensively to create artificial intelligence and introduce it into the economy, as well as using AI to solve the most important challenges facing humanity.
But the national plan for the development of artificial intelligence is only one area of research and development (R&D) in the PRC. China is already the world's second-largest digital economy and is leading the way in building digital infrastructure, having created, for example, the world's largest fiber-optic network.
Almost 1 billion Chinese use the Internet. More than 700 thousand 5G communication stations have been built, and about 300 million users are already connected to them. China has also mastered all the space technologies, leading the world in some areas. In 2025, it is planned to land Chinese astronauts on the moon and start building a lunar base.
China's total R&D spending in 2022 was nearly 3.09 trillion yuan (about $456 billion), an increase of 10.4% over 2021. Characteristically, R&D spending in 2022 exceeded 2.55% of the country's GDP, more than China spends even on defense. And R&D spending is growing by about 10 percent annually. In 2020, they reached 2.44 trillion yuan (2.4 percent of GDP), twice the country's defense budget. Their share is constantly increasing. And this shows that China intends to make technology development the basis of the economy and the main driver of its development, to become the leader of the global technology race. Since 2015, the country rose from 29th to 14th place in the world innovation ranking, becoming the world's largest supplier of patents and inventions. This allows the country to occupy leading positions in various technological areas.
In the Nature Index 2022 ranking of the world's top 25 science cities, there are nine Chinese ones. There are 8 such centers in the USA, 2 in Great Britain, and one each in Japan, Germany, South Korea and Switzerland. Science cities are determined by the number of scientific publications and citations of scientific data of scientists living in these cities. So, the 9 cities in China have the largest concentration of scientists who publish the results of their research in the world's publications.
Thus, China's share of global technology spending increased from 5 percent in 2000 to 23 percent in 2020. As the American magazine Foreign Affairs predicts, by 2025 China will overtake the U.S. on this indicator. China has everything for this: resources, management system, brains, incentives for growth.
One example. The global giant, China's Huawei, has already surpassed Western competitors in many areas, most notably in the creation of 5G technology. But the West fears not only its dependence on their developments, but also that the Chinese giant's successes provide an amazing example to the world - an example of a people's enterprise. The fact is that Huawei is owned by its employees, who have shares in the company and have a vested interest in its success.
Having made a great technological leap, China can completely surpass its competitors. China will once again become the center of the world and the most powerful economic and technological power, as it was before the Western barbarians came to the Celestial Empire, when China produced up to a third of the world's GDP.
Actually, the sun rises in the East, not in the West, as we have been assured for the last 150 years.