Many Chinese scientists and engineers are way ahead of their American counterparts in certain fields. This perception that China makes cheap low quality knockoff products is at least 20 years old and doesn’t reflect the reality of today. There is tons of innovation in China now - both manufacturing innovation and at a more basic level they have excellent state supported academic R&D programs. Top-down government technology priorities enable long-term research stability. Chinese R&D is far more robust than American R&D today, and given the current zeitgeist in the US they are likely to eclipse the US in scientific output and technology innovation in a few years.
Yes and no.
1. It remains a fact that China doesn't win Nobel Prizes and so doesn't compete at the very highest scientific levels. Unclear quite why this should be, or whether it will persist, but it's simply a fact right now.
2. What about R&D as opposed to pure science? The problem in this case is that Chinese capitalism is ruthless, pretty much exactly the caricature of western capitalism painted by Marx. Marx didn't seem to understand the elements (like patents, branding, and trademarks) that render each Western good an imperfect substitute for that from another company and, again for whatever reason, China likewise doesn't seem to have/get this. The relevance of this is that lacking any sort of market power (because almost everything is a commodity, sold under commodity competition conditions) there's very little profit in Chinese capitalism.
This means two things
- you mostly don't get rich investing in Chinese stocks or companies.
Look at the composite index. Mostly brief periods of mania, followed by the tragic realization that there's no money to be made - pathetic dividends, no price increase, no other way to monetize.
This is one (not the only) reason for the manic diversion of money into apartment blocks (which was pointless in its own, different way...)
Compare the US over the same sort of period:
- The second consequence is that there's not much money around to invest into real R&D.
Obviously there are a few huge companies in China, and plenty of billionaires. But the general consensus (shh...) is that pretty much every such case is blessed by the CCP and/or founded upon a crime. (Which then leads to its own pathologies like all the wealth that's generated being funneled to Los Angeles or Vancouver to be out of the reach of the police, rather than being re-invested).
So yeah, R&D does happen in strategic areas, but not generically. The current XRing is based on Western IP (ARM Cortex CPU, ARM Immortalis-G925 GPU. Xiaomi obviously want to project the idea that this is like Apple's A4 or A5, a starter SoC that begins with outsider CPU and GPU but with self-designed elements like the NoC, memory controller, IO, etc; and that they will in a few years graduate to their own CPU and GPU. Maybe...
But I could also believe that this is mostly a PR scam in the sense that there's not really any innovation in these elements. It wasn't clear at the time, but even with the A4 Apple was in fact seriously rethinking things like the NoC, IO and memory controller. Has Xiaomi done the same rather than just using off-the-shelf? I see no evidence for such rethinking.
Well we'll know in two or three years. But my *guess* is that Xiaomi is in the same position as most Chinese companies, without enough profit generated to allow for serious R&D at the Apple level.
Could this all change? Well sure. If China took economics seriously (ie at the highest political levels, if they actually understood the role of things like patents and branding, rather than simply treating them the way Marx does) they could start to steer the ship in that direction. But will they do so?
We thought permanent sanity was in place given Hu, then he was followed by Xi. It looks like Xi's star has been eclipsed (not officially, but unofficially he appears to be under house arrest, and it seems likely that as of the next party congress in September he'll be thanked for his service and officially kicked out -- very like what happened to Khrushchev, and for much the same reasons.
Oh you didn't know Xi appears to be under house arrest? Did you know he had a stroke last year?)
So OK, Xi gets replaced by someone from the Hu faction and sanity returns, kinda.
But does the new regime have the understanding, the will, or the capability to learn from the West in terms of industrial organization? (ie you need companies to make profits large enough to allow for serious R&D operations) Or are they frozen in their equivalent of the West's internal cold war, hamstrung enough by their equivalent of Woke that all the newly regnant Hu faction can do is hold the line rather than make real changes?