Chinese technology firms are combating the U.S. for global supremacy, but they are still dawdling behind where it concerns most. China is home to almost one-third of the global 326 unicorns (a company worth $1 Billion or more) or startups value more than a billion dollars, as per to a new report of Credit Suisse. But the U.S. firms have a top edge when it the cutting edge fields such as software, AI (artificial intelligence), and robotics are considered. Reportedly, only 14% of Chinese unicorns are targeted on those high-technology companies, correlated to 40% of their American equivalents, the report showed. China and the U.S. jointly account for 3 out of every 4 unicorns worldwide, with 93 and 156 respectively.
China’s major obstacle is its comparative lack of research investments. Vincent Chan—Credit Suisse’s Head of China Equity Strategy—said, “China’s scientific research, particularly basic research, is yet in a recovery phase.” As per to the report, Chinese investment on research and development amid 2000–2009 only contribute 1.2% of the national GDP, which is far lower than the 2.2% normal expenditure of OECD (Organisation for Economic Co-operation and Development) nations during the same time. Although China is now functioning to close the breach, that early spending “presents the foundation for the appearance of unicorns,” investigators of the Credit Suisse added. AI and robotics are mostly seen as doorways to the potential of technology and a central element of the ongoing spat amid Washington and Beijing for international dominance.
On a similar note, China presents a free-trade zone for overseas cloud providers. Li Keqiang—Chinese Premiere—briefed in recent time regarding 36 chiefs of foreign corporations—counting BMW and IBM—on a proposal which would pave the way to the country’s cloud computing industry by permitting foreign technology companies to establish data centers in China through a pilot free-trade zone. Apparently, the pilot program is a part of a heavy compromise Beijing is pursuing to make sure a trade deal with the U.S.