China and tech industry: will the U.S. soon lose their primacy?

  • Tuesday 12 June 2018

Numerous investors of the Silicon Valley have recently expressed their concern about the fact that the Chinese technology sector may soon outdo the U.S. giant in areas such as artificial intelligence and autonomous vehicles.

Mike Vernal, venture capitalist of Sequoia Capital, was the first to publicly express this concern during a recent debate concerning the San Francisco Bay Area: “I think there is a real risk that in three to five years’ time, we wake up and realise that China is far ahead of the U.S. and Silicon Valley”, said the Californian investor.

All elements supporting this theory seem already to be in the public eye: the Chinese venture capital percentage, which until a few years ago was only 5%, vertiginously increased to 24% and two Chinese companies – Didi Chuxing e Xiaomi – have recently reached an overall rating of over a billion dollars.

To consolidate this line of thinking there is the fact that China, aside from owning the world’s highest percentage of graduates – and in particular the highest number of STEM graduates –, certainly represents a more efficient State than the U.S. in removing obstacles and regulations concerning the technology sector.

On the other hand, according to another point of view, the tech sector is not a winner-takes-all one: the Chinese innovation might instead benefit economies and consumers of all over the world.

What remains unequivocal are then the concrete data, as well as the fact that China is today becoming a giant that does not seem to want to stop growing. According to the latest statistics, Chinese start-ups in the field of artificial intelligence are today receiving 48% of global investments, against 38% received from those in the United States.