Charles Ormiston, Chair of the Angsana Council, a prominent Singapore-based think tank, provides a thought-provoking perspective on the intense rivalry between the U.S. and China. Often likened to a high-stakes sporting contest, this article examines how both global giants stand to gain from the fierce competition, leading to greater innovation, economic growth, and technological advancements. Through a detailed analysis of their economic dominance, technological leadership, competitive strategies, and global impact, the article sheds light on the multi-faceted aspects of the U.S.-China faceoff.
Economic Dominance: A Formidable Duo
The U.S. and China’s combined economic power surpasses that of other major economies, such as Japan and Germany, with a fourfold GDP that creates a unique environment for substantial investment in research, education, innovation, and new businesses. The scale of these two giants ensures their capacity to maintain a high level of competitiveness, setting them apart from the rest of the field.
Technological Supremacy: Setting the Pace
A comprehensive study conducted by the Australian Strategic Policy Institute illustrates that China leads in 37 of the 44 critical technologies, outpacing the U.S. in seven fields. This technological dominance is evident in multiple areas, including market capitalization of technology-centric companies, venture capital deployment, startup landscape, and global market share in various technology sectors. Both nations are racing ahead, leaving others far behind.
Innovation through Competition: Driving Progress
China’s remarkable progress, especially over the last four decades, is attributed to a mix of intense competition and innovation-driven growth. Provincial governments compete vigorously in high-growth segments, harnessing subsidies, land allotment, and partnerships with universities and state-owned enterprises. This fierce competition extends to various industries, resulting in a Darwinian struggle that propels sectors like mobile phones, e-commerce, solar panels, and electric vehicles to new heights.
Global Spillover Benefits: A Silver Lining
While concerns arise regarding wasteful duplication and potential geopolitical tensions, the competition between the U.S. and China has a significant silver lining. The world stands to benefit from duplicated investments in critical areas like semiconductors, solar panels, batteries, and next-generation power transmission, as both rivals strive for supremacy. This spillover effect contributes to global innovation and technological progress.
Global Engagement: A Complex Relationship
Despite the U.S.-China rivalry, most countries in the world have deeply integrated economic ties with both giants. This complex web of global engagement means that the world will not merely choose one rival over the other. Instead, nations will maximize spillover benefits from both, recognizing China’s status as a significant trading partner and the U.S.’s broad engagement.
Challenges and Potential Disasters
Both countries grapple with domestic challenges, from demographic decline and property bubble concerns in China to sociopolitical polarization and a competitive manufacturing sector struggle in the U.S. While the prospect of a direct conflict over Taiwan remains a significant concern, the global landscape lacks an up-and-coming rival that is free from substantial challenges.
Innovation and Prizes: A Bright Future
The U.S.-China rivalry, while carrying several negatives, holds a silver lining of faster innovation and technology spillover to the rest of the world. Breakthroughs in clean technologies, nuclear fusion, quantum computing, and biomedicine are within reach, driven by the innovation prowess of the U.S. and China. Just as in sports, where Nadal, Federer, and Djokovic often emerge victorious, these global innovators are poised to lead the way, reaping most of the prize money and shaping the future of technology and innovation.
The U.S.-China faceoff, resembling a strategic yet competitive match, is set to propel both nations to greater heights. The race for innovation and technological supremacy holds the potential to transform the world, and while challenges and concerns persist, the spillover benefits for the global community make this rivalry a double-edged sword.