China, Artificial Intelligence, and the Road to Tech Supremacy -- Intro & Part I

An Introduction to China and its Quest to Develop Artificial Intelligence

The defeat of Korean Go master Lee Sedol by DeepMind’s AlphaGo in March 2016 triggered a primal response in the Chinese population and the Chinese Communist Party that shook them to their core. More than 280 million Chinese citizens tuned in to watch the Lee-AlphaGo game, where Lee lost 4 to 1, stunning the world of Go and forcing deep reflection amongst the Chinese to lose at a game they invented (Lee 2018, 3). Scholars and industry veterans such as Kai-Fu Lee, Jinghan Zheng, and Dan Wang have identified this event as a “Sputnik moment” for the Chinese that tapped into a deep-seated cultural anxiety about losing out technologically to Western powers (Lee 2018; Zeng 2022; D. Wang 2021). As Kai-Fu Lee noted in the opening of his book AI Superpowers, the victory of AlphaGo was both “a challenge and inspiration” (Lee 2018, 2). A little more than a year after this decisive defeat, the PRC State Council, the highest administrative body in the country, released a national AI development plan in July 2017 with the express intent of positioning China as the undisputed world leader in this field by 2030 (Webster 2017; Kanaan 2020).

Artificial Intelligence has increasingly become the fundamental defining technology of the 21st century, which has the potential to accelerate all other technological and economic pursuits. The PRC State Council’s New Generation AI Development Plan (NGAIDP) (2017) stated that, “AI has become a new engine of economic development. AI has become the core driving force for a new round of industrial transformation, [which] will advance the release of the huge energy stored from the previous scientific and technological revolution and industrial transformation, and create a new powerful engine…” (Webster 2017, para. 4). The Chinese government’s focus on AI is driven by a political imperative for technological sovereignty and to leverage this new field to leapfrog rivals like the United States back into the realm of a technological superpower. AI, therefore, is the overall intelligence layer that unites the broad efforts of the Chinese government to create a “Digital China,” which is a direct repudiation of Western technological hegemony across the entire stack from connectivity via satellites and fiber optics to semiconductor manufacturing to the fundamental frameworks used to build next-generation AI models. Mastering AI is as important to the Chinese as mastering gunpowder, electricity, the atom, or the electronic circuit. As plainly stated by the? 2017 NGAIDP, “AI is a strategic technology that will lead in the future.” China must “firmly seize the strategic initiative in the new stage of international competition in AI development, to create new competitive advantage, opening up the development of new space, and effectively protecting national security” (Webster 2017, para. 3).

Scope and Focus of the Chapter

This chapter aims to explore how China’s values fundamentally shape and drive its development of Artificial Intelligence and how these values intersect and guide its strategic aim of establishing itself as the preeminent technological world power. This strategic aim directly serves the second centennial goal: “Building a Modern Socialist Country” by 2049, the 100th Anniversary of the founding of the People’s Republic of China (Ding Lu 2016; Xi 2017) in which Xi Jinping describes a time when “China has become a global leader in terms of composite national strength and international influence” (Xi 2017, 25).

The core national values driving China's AI development are economic development, public security, and social governance - a "virtuous trinity" that underpins the political legitimacy of the Chinese Communist Party. These three core value themes are deeply integrated into Chinese strategic thinking, functioning as both concrete policy objectives and guiding principles. Economic development serves as the foundation for social stability and national rejuvenation. Public security encompasses both traditional security and technological sovereignty. Social governance represents the CCP's capacity to maintain societal order and harmony through both traditional and technological means. This framework can be challenging for Western scholars to fully grasp, as it differs fundamentally from Western approaches where values like "individual liberty" or "freedom of speech" often remain abstract political concepts. In Chinese policymaking, values are operationalized through what Chinese scholars term "pragmatic governance" or “pragmatic authoritarianism,” reflecting the traditional philosophical concept of the unity of knowledge and action (Jing 2017; Lai 2016). This creates a circular dynamic where values drive concrete achievements, reinforcing those same values and legitimizing the governance system.

Organization of the Chapter

This chapter is organized into four distinct parts. The first explores China's strategic culture and history and how this fundamentally differs from Western strategic thought as it relates to the development of AI. The second examines China's securitization of AI through Waever's securitization theory, analyzing how the values of stability and control permeate Chinese AI strategy and are operationalized for national defense, public security, and social governance. The third section analyzes China's hybrid approach to innovation, examining how the government balances 'giving full play to the market' with maintaining strategic control over technological development through state guidance and industrial policy. The final section explores how AI serves as the linchpin in integrating China's diverse technological systems, extending Chinese influence beyond its domestic tech ecosystem to shape the global digital landscape. This strategy not only reinforces China's internal digital sovereignty but also positions it to define and control significant portions of the worldwide tech ecosystem as a 21st-century “cyber superpower.”

Part I: China’s Strategic Culture

China's strategic approach to Artificial Intelligence is profoundly shaped by its historical experience during the "Century of Humiliation" (1839-1949), which imbued within the Chinese Communist Party (CCP) a dogmatic emphasis on economic development, public security, and social governance. These core values emerged as central pillars of CCP legitimacy, as the Party's mandate to rule became inextricably linked to its ability to deliver on these fundamental promises to the Chinese people (Ruan 2015). The transformative success of Deng Xiaoping's post-1978 reforms served to validate and reinforce a distinctly paternalistic governance model, wherein economic development and social stability are pursued through strong central direction and coordinated public-private alignment (CFR 2024).

A Century of Humiliation

The Century of Humiliation refers to the 110-year period that saw the collapse of the Chinese Imperial system, which had reigned for millennia under the design and influence of Western foreign powers. The period started in 1839 when the British Royal Navy sent gunboats up the Yangtze River to force China to open itself to foreign trade, especially opium (Kaufman 2011). China was forced to open and effectively cede control of a number of “treaty ports” where foreign powers such as the British effectively ran their own colonies and imposed their own laws, and lost control of Hong Kong and other territories entirely. During this period, Japan—historically viewed as China’s weaker "younger brother"—embraced Western technology and military doctrine, rapidly industrialized, and decisively defeated China in the 1890s, seizing Taiwan and parts of Manchuria (Kaufman 2011, 2). Throughout the 1800s, China was beset by mass rebellions and uprisings amongst its populace, incensed by the central government's weakness and their acquiescence to foreign powers. Independence movements in Tibet, Mongolia, and Xinjiang in the early 20th century after the formal collapse of the Qing Dynasty in 1911 further eroded China's territorial sovereignty. In the Chinese narrative of self-determination, this period of humiliation only ended when Mao Zedong led the Chinese Communist Party (CCP) and the Red Army to victory against the Chinese Nationalists (KMT) of Chiang Kai-Shek and drove them off the mainland to Taiwan and established the People’s Republic of China on October 1, 1949 (Kaufman 2011).

The narrative of humiliation and national rejuvenation under the leadership of the Chinese Communist Party is fundamental to the Chinese national self-image. Richard Harris wrote in “China and the World” for International Affairs in 1959, just a decade after the founding of the PRC, that the “Chinese have a very broad generalization about their own history: they think in terms of ‘up to the Opium War’ and ‘after the Opium War’” (Harris 1959, 162). The Century of Humiliation dealt a profound blow to China’s national psyche, shattering its self-image as the Middle Kingdom—the celestial empire at the heart of a vast tributary network, the unrivaled technological pioneer of gunpowder, the compass, and paper, and the rightful center of civilization between heaven and Earth (USCC 2020). Millennia of technological prestige and political preeminence collapsed in less than a century when faced with modern Western firepower. The Century of Humiliation formed a crucible that “never again” will the Chinese allow themselves to fall behind the West, for if they do, they will surely be subjugated again. This narrative is continuously fanned by CCP propaganda as the CCP is presented as the only political party willing and able to stand up to foreign aggression and humiliation. As noted by former Politburo Standing Committee Member Liu Yunshan in 2009: “The establishment of new China [i.e. communist China] … put an end to the situation in which old China was split up, the nation was subject to humiliation, and the people experienced untold sufferings” (Kaufman 2011, 3). The CCP continues to see the West and America as intent on holding back China’s rise to its natural place as a global leader and approaches its interactions in international competition through this historical and strategic lens (Kaufman 2011).

As noted by the US-China Economic and Security Review Commission, the CCP seeks to revise the international order to be more amenable to its interests and governance system and, furthermore, craft a new global order that is tilted away from the Western-dominated world order which was established after World War II (USCC 2020). In the Chinese strategic framework, the current Western-led international world order is a continuation of the subjugation it experienced during the Century of Humiliation. China continues to operate from a position of profound national insecurity with the express intent of firmly reestablishing itself as the new “Middle Kingdom” of the 21st century (Kaufman 2011, 7). The fundamental goal, the Chinese Dream, is to construct a Modern Socialist state and rejuvenate Chinese civilization that is not beholden or subject to the demands of the West and more especially, the United States. In the context of Artificial Intelligence, this gives rise to the fundamental political prerogative of technological sovereignty, especially as it relates to producing semiconductors, developing foundational AI frameworks, and the communications infrastructure such as satellites and fiber optics, which undergird the global internet.

This historical experience profoundly shaped the CCP's core values and governance approach, reflecting what Finnemore and Sikkink (1998) describe as the final stage of norm internalization, where certain principles become so deeply embedded in institutional thinking that they shape policy at an almost unconscious level (Finnemore and Sikkink 1998). The trauma of economic exploitation led to an emphasis on economic development and self-reliance as foundations of national power. The experience of foreign intervention and internal upheaval created an overriding focus on public security and territorial integrity. The memory of social breakdown during this period reinforced the importance of social governance and stability. These values, forged in the crucible of national humiliation, now directly inform China's approach to artificial intelligence development, where each technological advance is seen as serving these fundamental state priorities (Ruan 2015; Lai 2016; Kaufman 2011).

Modern Strategic Framework

The modern strategic and political discourse in China has been dominated by one man and his dream of a rejuvenated China that can stand toe to toe with the United States and other powers on the world stage. Xi Jinping has led China since 2012 and now, with the removal of term limits, is the most powerful Chinese leader since Mao Zedong in the history of the PRC (Garrick and Bennett 2018). Xi’s strategy for achieving the Chinese dream was articulated at the 19th Party Congress in October 2017 as “Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era” which laid out a “Four-Pronged Comprehensive Strategy.” The “Four Comprehensives” of Xi Jinping's Thought are: 1. Building a moderately prosperous society, 2. Deepening reform, 3. Governing the nation according to law, and 4. Tightening Party discipline (Garrick and Bennett 2018). Xi Jinping Thought has become so integral to the Chinese political context that it has since been incorporated into the preamble of the Chinese Communist Party Constitution, cementing Xi Jinping Thought into the very fabric of governance and society (Xinhua 2017).

Xi Jinping Thought is built around “10 Definitives,” which enable the execution and achievement of the “Four Comprehensives.” Central to Xi Jinping Thought is the indispensable nature of the CCP. Xi writes that, “the most essential feature of Socialism with Chinese Characteristics is the leadership of the CCP, the greatest advantage of the socialist system with Chinese characteristics is the leadership of the CCP, the Party being the supreme political force” (CMP 2022, n. First Definite). Xi writes that the “overall task” is “to build a rich, strong, democratic, civilized, harmonious and beautiful modern socialist power” (CMP 2022, n. Second Definite) The Second Definitive formed the foundation for China's "Centenary Goals": achieving a "moderately prosperous society for all" by 2021 (the CCP's 100th anniversary) and establishing China as "a great modern socialist country" by 2049 (the PRC's 100th anniversary) (Long 2022; CMP 2022). Xi Jinping Thought emphasizes a comprehensive “five in one” approach towards national rejuvenation focusing on economic, political, cultural, social, and ecological development occurring simultaneously and in a mutually reinforcing manner (CMP 2022). This means that subsequent Chinese policymaking is mandated to produce policies and laws that advance the entirety of Chinese civilization across these five domains. In the context of AI policy, any subsequent development of technology must work to advance and deepen economic, political, cultural, social, and ecological reform in service of Xi Jinping Thought under the paternalistic guidance of the CCP. It is not simply about driving economic development but harnessing this new field of technology to drive the entirety of Chinese civilization.

In November 2021, the original eight definitives were updated with two more diktats: “allowing the markets to play a decisive role in the allocation of resources” and ensuring “the strategic policy of comprehensive strict governance of the party” (CMP 2022, n. 7th Definite). These new mandates appear to contradict one another: allowing the markets to determine the outcome of resource allocation and yet still ensuring total party control. As Zeng notes in his book AI with Chinese Characteristics, given how large a populace the CCP has to govern, it is not practical or pragmatic to micromanage the entirety of the market. Instead, it sets broad guidelines and goalposts for party organs, industry, and society to achieve (Zeng 2022). The seeming liberalization of the tech sector and allowing the “full play” of the market is intended to allow for private sector market dynamism within the contours of Party goals and in service to the overall rejuvenation of the Chinese nation (Lee 2018; Zeng 2022; Ding 2018; Webster 2017).

Strategic Framework for Values and Goals and Advancing AI

In China, values are not treated as abstract principles but are operationalized into concrete goals. When the Chinese Communist Party (CCP) designates becoming the “world’s dominant AI power” as a national priority, it is not merely setting a strategic objective but establishing a core value that permeates all levels of society (Webster 2017, 6). This goal is transformed into a national ethos, where citizens, businesses, and government entities alike align their efforts towards technological superiority, seeing it as essential to China’s national identity, stability, and global influence. The goal itself becomes an intrinsic part of the country's values. For example, achieving global leadership in AI is not only framed as a technical milestone but is elevated into a shared national value, demanding collective action and long-term commitment. It is critical to China's future, making it a value that must be pursued, protected, and institutionalized across society.