China has emerged as a dominant force in the global technology landscape, according to the Australian Strategic Policy Institute’s 2025 Strategic Technology Tracker. Released last week, the report highlights China’s leadership in seven out of eight artificial intelligence categories, all seven sectors of defense, space, robotics, and transportation, and a significant majority in advanced materials, manufacturing technologies, and energy. This ascendancy raises questions about the global balance of power and the future of technological innovation.
The announcement comes as China continues to expand its influence across various high-tech industries, despite having only half the number of billionaires compared to the United States. This paradox is explained by China’s unique approach to technology development, driven by government-led initiatives rather than individual entrepreneurship. The Chinese Communist Party, unburdened by the skepticism towards technology that characterized Marxist-Leninist ideology, is spearheading this transformation.
China’s Strategic Approach to Technology
China’s technological prowess was on full display at the 27th Hi-Tech Fair in Shenzhen, showcasing innovations like humanoid robots and “eVOTL” vehicles (electrical vertical take-off and landing). The fair highlighted China’s rapid advancements, which are not just limited to consumer gadgets but extend to critical infrastructure and defense technologies.
According to Faustine Delasalle, Executive Director of the Industrial Transition Accelerator, “There’s an acceleration in China that we’re not seeing in the rest of the world.” This sentiment underscores the shift in global dynamics, where Western nations are now striving to catch up with China’s technological advancements.
Engineering Marvels and Government Policy
China’s achievements include a mosquito-sized drone for surveillance, extensive solar panel installations in Guizhou, groundbreaking cancer therapy research, and a high-speed rail network that spans 48,000 kilometers. These developments are supported by a “whole of nation” industry policy, which coordinates efforts across government, academia, and industry to achieve national technological goals.
China’s government has committed US$1.4 trillion over five to six years on new infrastructure, including 5G networks, smart cities, and industrial digitalization.
Analyst Dan Wang, in his book “Breakneck — China’s Quest to Engineer the Future,” explains that China’s focus on engineering contrasts sharply with the United States’ legalistic approach, which often stifles innovation. This strategic orientation has enabled China to leapfrog traditional innovation models and establish itself as a global leader.
Global Implications and Geopolitical Clout
China’s dominance in critical minerals and rare earths necessary for modern technology further strengthens its geopolitical position. However, this rapid growth has led to challenges such as overcapacity and “involution,” where intense competition results in diminishing returns. The Chinese government is now working to mitigate these issues.
In contrast, Australia’s recent “National AI Plan” appears underwhelming. While it allocates $30 million for an AI safety institute, the funding is dwarfed by China’s substantial investments in AI development. The plan relies on existing funds rather than new investments, reflecting a lack of urgency compared to China’s aggressive strategy.
The G2 World Order
The United States, recognizing China’s growing influence, has shifted from a policy of decoupling to one of transactional co-management, acknowledging the emergence of a “G2” world order. This new dynamic suggests a division of global influence, with the Asia-Pacific region increasingly falling under China’s sphere.
China’s strategic advancements suggest it may soon absorb Taiwan, potentially without military conflict, signaling a new era in global geopolitics.
As China continues to redefine the global technology landscape, nations like Australia must navigate this new order. The implications for international relations and economic strategies are profound, requiring a reevaluation of alliances and priorities.
In conclusion, China’s technological ascendancy represents a fundamental shift in global power structures. As the world adapts to this new reality, the balance between cooperation and competition will shape the future of international relations.
