December 2024
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HOW CHINA MADE A DIFFERENCE THIS MONTH
Four Chinese Innovation Trends To Watch in 2025
As we enter 2025, it’s shaping up to be a pivotal year for global superpowers. The re-election of Donald Trump could either "Make America Great Again," as promised to his voters, or destabilize the U.S. both internally and on the global stage. Will AI continue driving tech giants’ valuations upward, or are we on the brink of a U.S. stock market crash? Could Trump ignite new trade wars with former allies and adversaries, and what ripple effects might this have on Europe, China, and the Global South?
On the military front, will the conflict in Ukraine finally come to an end, and how will Europe navigate its aftermath? Could the crisis in Gaza and regime change in Syria escalate into a regional war involving Iran? Meanwhile, will China manage to restore confidence in its economy, or are we witnessing the early tremors of a systemic economic shock?
Lastly, will the U.S. and even some EU countries retreat from their commitments to the 2015 Paris Climate Agreement, and will China now take the lead in steering the world toward a sustainable, green future? This year hopefully holds the answers to these critical questions, and the outcomes will undoubtedly reshape our world order for years to come.
2025 is shaping up to be another year of unpredictability, with any predictions about global trends sharply divided. Some analysts believe the U.S. will thrive while Europe struggles, while others see Trump’s return as a wake-up call for Europe to unite and strengthen its position. Opinions about China's economic trajectory differ even more. Some predict that China's economy will peak in 2025, mirroring Japan's economic stagnation post 1995. Others are more optimistic, expecting stimulus policies and innovation initiatives to kickstart a new phase of economic recovery and growth.
One thing seems clear: Western trend watchers anticipate China’s economic peak to be imminent, while Chinese trend watchers predict a U.S. market crash and prolonged stagnation in Europe. Given the current global uncertainties, 2025 stands out as one of the most challenging for me, as a thought leader, to make confident predictions.
However, despite the turbulence in world affairs, I am confident in identifying four key Chinese innovation trends poised to shape the global future in 2025.
1.??? Chinese companies are ready to go global.
What set 2024 apart for Chinese innovation was the global recognition of the exceptional quality of Chinese New Energy Vehicles (NEVs), which took the world by storm. It was the year BYD surpassed Tesla in global car sales, marking a significant milestone. In response, both the U.S. and Europe imposed tariffs on Chinese NEVs to protect their domestic automotive industries. Meanwhile, non-Chinese car brands continued to lose market share in China to competitive local brands. 2024 also saw Volkswagen closing factories in Germany, Northvolt filing for bankruptcy in the US, and Japanese automotive giants Nissan and Honda announcing plans to merge in a bid to compete with the growing dominance of Chinese automakers.
2024 marked a significant mindset shift for Chinese companies, as they now much more confidently believe they can compete with any global brand. Looking ahead, 2025 is set to see even greater momentum for Chinese brands going global. This shift is driven by three key factors:
1.???? Chinese buyers are trading down, making global markets increasingly attractive for Chinese companies.
2.???? Chinese brands have closed the quality gap with Western competitors, positioning themselves as globally competitive players.
3.???? Biden’s technology war against China has inadvertently boosted self-confidence in Beijing and among Chinese producers, encouraging them to view global markets as strategic opportunities for expansion rather than mere export destinations.
South-East Asia and the Middle East are seen as mid-term investment and growth opportunities, while Europe is viewed as a short-term market focused on profit and brand establishment.
2.??? Chinese Large Language Models (LLMs) will rise as a phoenix
In the final days of 2024, the Chinese startup DeepSeek launced a groundbreaking open-source AI model (DeepSeek V3). This model outperformed Meta’s Llama 3.1 and Alibaba’s Qwen 2.5, while delivering results on par with OpenAI’s ChatGPT-4 and Amazon’s Claude 3.5.
The most significant achievement, however, was the efficiency and speed of its development. The Chinese research lab trained the model in just two months, using GPUs that cost only $5.5 million USD, a stark contrast to the hundreds of millions or even billions spent by American competitors.
What sets DeepSeek V3 apart is its mixed-model architecture. Instead of relying on a single monolithic approach, it activates different sub-models dynamically to optimize performance for specific token-generation tasks. This design reduces inference costs, enhances scalability, and improves latency and processing speed. DeepSeek V3 not only demonstrates technical excellence but also signals a new era of cost-efficient AI innovation from China.
Kaifu-Lee from 01(dot)AI recently discussed how, in 2024, Chinese engineers made significant strides in optimizing limited access to Nvidia GPU resources. By leveraging innovative engineering solutions, they managed to train advanced AI models at a fraction of the cost incurred by their American counterparts. Instead of treating the challenge as a computational problem, Chinese developers approached it as a memory optimization issue, employing multilayer caches, specialized inference engines, and other efficient techniques.
I predict that Chinese large language models (LLMs) will become significantly cheaper than American alternatives, positioning China as the "GenAI factory of the world." This cost advantage will likely appeal to countries and organizations operating under financial constraints. Such a shift could disrupt the U.S. AI-driven tech stock market, though I am not yet prepared to make a definitive prediction.
3.??? Three new industries will take off: Robotaxis, eVTOL,?and Humanoid Robots
In 2024, three emerging industries in China have made significant waves, with robotaxis leading the charge. Similar to trends in America, robotaxis are rapidly gaining traction. While Level 4 (L4) autonomous driving technology is already road-ready, regulatory constraints remain a limiting factor. With 32,000 kilometers of test roads already established in China, 2025 is set to see robotaxis operating in at least 65 Chinese cities. The cost of L4 vehicles has decreased significantly in China, making investments in the sector more profitable, and the average usage has already reached 20 robotaxi rides per day. Given that China now commands 70% of the global NEV (New Energy Vehicle) market, it is well-positioned to achieve similar dominance in the robotaxi sector starting in 2025.
Another industry that gained significant momentum in 2024 is the eVTOL (Electric Vertical Take-Off and Landing) sector, also known as the low-altitude economy. In 2024, the first licenses for flying and manufacturing flying taxis were issued to eHang. I had the opportunity to experience one of their flying taxis in April in Guangzhou, and the company projects having 10,000 flying taxis operating in Shenzhen by 2030. Meanwhile, Xpeng has established the first modern assembly line for flying cars, marking another milestone in the industry. What makes me particularly optimistic about China's low-altitude economy is China’s commitment to this sector, demonstrated by the creation of a new government department to support and accelerate its development.
One of the most fascinating trends to watch is the evolution of humanoid robots. With Generative AI enabling robots to talk, think, and learn more like humans, their potential applications have expanded significantly. China is making impressive strides not only in AI development but also in robot engineering, bringing humanoid robots closer to matching human physical capabilities. At the World Robot Conference held in Beijing in the summer of 2024, the atmosphere felt like stepping into a sci-fi future. Once again, cost efficiency is where China excels. For instance, Chinese robo-dogs are priced at $3,000, a stark contrast to the $75,000 robo-dogs from Boston Dynamics. Furthermore, Unitree has established the world’s first mass-production assembly line for humanoid robots, which are expected to debut in factories and logistics, revolutionizing industrial workflows.
4.??? The “New Quality Productive Forces” Initiative will go from rhetoric to metric
In 2023, Beijing introduced the "New Quality Productive Forces" (NQPF) initiative, a bold plan aimed at modernizing China over the next decade. This initiative follows the Made-in-China 2025 strategy launched in 2015, which focused on upgrading 10 key industries and achieving technological independence. While Made-in-China 2025 targeted specific industrial sectors, NQPF takes a more holistic approach, aiming to transform the Chinese economy as a whole. NQPF serves as China's latest blueprint to become the world's leading technological superpower.
Surprisingly, despite its ambitious scope, Western media appears to be paying less attention to NQPF compared to the Made-in-China 2025 plan. This lack of global focus could very well be the biggest blind spot regarding China's real masterplan.
This new paradigm aims to transition China’s economic growth model from its traditional reliance on investment, infrastructure, and exports to one centered on innovation, knowledge, quality, productivity, and sustainability. In essence, the shift is from “Made in China” to “Created in China”, and from being the “Factory of the World” to becoming the “R&D Center for the World”. Starting in 2025, I predict China will introduce hundreds of KPIs designed to achieve its strategic goals by 2035 or earlier. The graph I’ve created below illustrates the meaning behind the four key pillars represented by NQPF and outlines the transformative shifts we can expect over the next decade.
2025 marks a pivotal year:
·????? Traditional Industries will begin their transformation to meet NQPF standards, embracing higher levels of efficiency, innovation, and sustainability.
·????? New Industries - such as eVTOL and robotaxis - will gain significant momentum through NQPF-driven policies and investments, positioning themselves to set new global benchmarks.
·????? Future Technologies will emerge under the guidance, support, and funding of the NQPF framework, laying the foundation for breakthroughs that could redefine global innovation landscapes.
?2025 will likely represent the beginning of a systematic, KPI-driven approach that prioritizes quality over quantity, long-term resilience over short-term gains, and innovation over low-cost.
CHINESE INNOVATION NEWS – DECEMBER 2024
1. China unveils new high-speed rail at 450km per hour
2. China opens its first atmospheric monitoring station in Antarctica
3. Chinese Rare Earth war is in full swing
4. The Great Green Wall of China
5. Desert ant shows Chinese team the way to hi-def polarised light sensor chip
6. ?Countdown to NEO brain-computer interface clinical trial in China
7. China’s ‘explosive’ ironmaking breakthrough achieves 3,600-fold productivity boost
8. China Generative AI updates December 2024
(Click the links in titles below to read a larger news article on each topic)
China has unveiled its latest high-speed train prototype, the CR450, in Beijing. Capable of reaching 450 km/h with an operational speed of 400 km/h, it now holds the title of the fastest high-speed train in the world, surpassing the current CR400, which operates at 350 km/h. Development of the CR450 began in 2018, and it has since undergone 200 days of rigorous high-speed testing across 200,000 kilometers of rail lines. Beyond speed, the train excels in energy efficiency, noise control, and braking performance, with an impressive braking response time of 1.7 seconds.
The train demonstrates exceptional energy efficiency, having reduced running resistance by 22% and cut its weight by 10%. These advancements ensure greater stability, performance, and safety even at higher speeds. For passenger comfort, the train features advanced noise-reduction technology, lowering noise levels by 2 decibels, and a redesigned interior that enhances both comfort and convenience while increasing cabin space by 4%. The ultimate goal is to make this cutting-edge technology available to passengers very soon.
China is no longer a follower in high-speed railway innovation but has emerged as a global leader. Over the past 15 years, China has constructed the world's largest and most advanced high-speed rail network, spanning over 46,000 kilometers of high-speed rail lines.
China has recently put into operation its first overseas atmospheric background station in Antarctica, a culmination of its four decade-long presence in the region.
It will conduct continuous, long-term monitoring of atmospheric composition and concentration changes in Antarctica, providing crucial data to enhance global efforts against climate change, as polar regions are "amplifiers" of global climate change.
China established its first Antarctic research base, the Great Wall Station, in 1984. This newest atmospheric monitoring station marks China's first overseas facility of its kind and the ninth atmospheric background station operating nationwide. Located at China’s second Antarctic research station, founded in 1989, the facility is equipped with an advanced observation system that monitors seven key meteorological elements, including ozone, atmospheric chemistry, and aerosols.
Similar to the United States, China has been expanding its polar research efforts. In 2024, Chinese researchers began establishing a surveillance network to monitor Antarctic krill, a project aimed at safeguarding the continent’s marine ecology for the future. China’s fourth polar research icebreaker, the Jidi, successfully completed its maiden voyage in September. Meanwhile, the US Coast Guard cutter Polar Star departed from Seattle in December for a month-long deployment to Antarctica as part of Operation Deep Freeze, an annual joint military mission focused on resupplying research stations. The race for dominance in polar research between China and the US is intensifying.
On December 3rd, China announced a ban on the export of gallium and germanium under newly implemented export controls, citing national security concerns as the primary reason for the restrictions. China produces approximately 94% of the world’s gallium, a critical material for manufacturing semiconductors, LEDs, and 5G technology. Similarly, China controls about 83% of the global germanium supply, which is essential for fiber optics, infrared optics, and solar cells. This move is widely viewed as a strategic countermeasure against the United States’ escalating export controls, which aim to limit China’s access to advanced technologies.
A recent LinkedIn article by Jost Wübbeke from Sinolytics provides an insightful analysis of China’s mineral advantage and how the emerging rare earth war might unfold. China has identified 31 critical materials, of which it holds a competitive advantage in 10, while facing shortages in 21. This challenges the common misperception that China dominates the global geological availability of all minerals. Wübbeke’s forecast outlines China’s strategic ‘mineral ban’ approach as follows:
1. Initial focus: Prioritize minerals with both geological reserves and processing capabilities, such as indium, rare earth elements, tungsten, graphite, fluorite, and vanadium.
2. Second phase: Shift attention to minerals requiring only processing capabilities, such as lithium, cobalt, and tantalum.
3. Final focus: Address minerals of lower criticality, including magnesium, zinc, tin, and others.
Regardless of the outcome, China seems to have ignited a new economic "war" with the US over critical minerals.
One of China’s most remarkable yet overlooked achievements is the construction of a ‘green belt’ around its largest desert, the Taklamakan Desert, located in the Xinjiang Uyghur Autonomous Region. As the second-largest shifting sand desert in the world (half the size of the Empty Quarter in the Arabian Peninsula), approximately 85% of its 337,600 square kilometers is covered by moving sand dunes.
This green belt, composed of trees and shrubs, spans an impressive 3,050 kilometers around the desert. What sets it apart is the use of solar-powered ‘green energy’ corridors that effectively prevent the sand from advancing during sandstorms, showcasing an ingenious combination of environmental restoration and technological innovation.
This double ‘green belt’ project has taken an astonishing 46 years to complete, involving the efforts of an estimated 600,000 people who planted trees such as desert poplar, red willow, and saxaul trees. With the green belt now completed, China plans to further invest in the region, aiming to connect cities and facilitate the transportation of people, food, and minerals from an area once known as the “Sea of Death.”
Can you think of any other country capable of planning so far ahead - 46 years into the future?
Here’s another fascinating story rooted in the desert. Researchers from Beihang University in China, in collaboration with scientists from Imperial College London, have developed a compact chip capable of detecting the orientation of polarised light. For inspiration, they studied the eyes of desert ants, which provided a model for a simpler and more efficient design.
Polarisation photodetectors (pol-PDs) are specialised light sensors that detect the direction of polarised light. By distinguishing differences in incoming light, these sensors enhance contrast and improve image quality. However, miniaturising commercial polarisation photodetectors remains a significant challenge.
While human eyes consist of a single eye unit, the compound eyes of insects are made up of numerous small units, each containing photoreceptor cells. Desert ants possess hundreds of these units, enabling them to navigate vast, barren deserts without landmarks and return to their nests by perceiving polarised sunlight.
Inspired by this, the research team developed a novel nanoimprinting crystallisation method to create thin, crystalline films. These were integrated into a chip, eliminating the need for bulky polarisation optical components. The resulting chip holds immense potential, with applications in navigation systems, fingerprint detection, and even cancer tissue identification.
Chinese researchers are set to conduct a clinical trial next year on groundbreaking technology that links the brain directly to electronic devices. The coin-sized brain-computer interface (BCI) was developed in China and has already been successfully implanted in three patients.
The implant, named Neural Electronic Opportunity (NEO), is the result of a collaboration between Neuracle Technology and researchers from Tsinghua University’s biomedical engineering department. Unlike Elon Musk’s Neuralink, which involves chips implanted directly in the brain, NEO adopts a semi-invasive approach. Its electrodes are positioned outside the brain cortex, avoiding direct contact with brain tissue and reducing potential risks.
NEO has become the first brain-computer interface (BCI) product to gain access to China’s “green channel” for expedited approval of innovative medical devices. Large-scale clinical trials are set to begin next year, with plans for at least 30 implantations across the country. The device is expected to be ready for clinical use by 2027.
China is the third-largest producer of iron in the world, and currently accounts for 70% of global iron ore imports. With over 50% of global steel production capacity, China leads the world in steel manufacturing.
Chinese scientists have developed a revolutionary ironmaking technology poised to transform the global steel industry. This innovative method involves injecting finely ground iron ore powder into an extremely hot furnace, triggering an “explosive chemical reaction”. This process produces bright red, glowing liquid iron droplets that collect at the bottom of the furnace, forming a continuous stream of high-purity iron. While the concept of applying this process to ironmaking originated in the United States, it was a Chinese research team that developed the revolutionary flash smelting technology capable of directly producing liquid iron. They secured a patent for the method in 2013 and spent the following decade perfecting it.
This innovative process completes the ironmaking process in just 3 to 6 seconds, compared to the 5 to 6 hours required by traditional blast furnaces - a staggering 3,600-fold increase in speed. The method is particularly effective for low- or medium-yield iron ores, which are abundant in China, reducing the country's reliance on high-yield ores imported from Australia and Brazil. Additionally, it improves energy efficiency by one-third and eliminates the need for coal, enabling the traditionally high-polluting ironmaking industry to achieve “zero-carbon” emissions.?
8. China Generative AI updates of December 2024
China’s leading facial recognition company, SenseTime, is shifting its strategic focus and core business areas towards Generative AI to better capitalize on the opportunities and address the challenges of the emerging AI 2.0 era.
Tencent has introduced a text-to-video generation tool powered by its Hunyuan artificial intelligence (AI) foundation model. Boasting over 13 billion parameters, HunyuanVideo is the world’s largest open-source model for video generation.
A Chinese start-up, incubated at Tsinghua University, has begun internal testing of its AI-powered virtual hospital platform. The platform includes 42 AI doctors across 21 departments, such as emergency care, respiratory medicine, paediatrics, and cardiology. It is scheduled to be made available to the general public in the first half of 2025.
Although China produces more engineering graduates annually than all western countries together, its rapidly growing AI industry still faces a significant talent shortage. Among the top 20 "new economy" job categories, one-quarter of job openings are directly related to AI.
China’s Ministry of Industry and Information Technology (MIIT) has announced the formation of an “AI Standardization Technology Committee”, which includes executives from leading tech companies such as Baidu, Alibaba Group, Tencent, and Huawei Technologies.
Shares of AI chip designer Cambricon Technologies have surged 383% this year, outperforming the CSI 300 Index and boosting the company’s market value to US$37 billion. The Shanghai-listed stock has even outpaced global AI chip giants such as Nvidia and Taiwan Semiconductor Manufacturing Company (TSMC).
China’s generative artificial intelligence (GenAI) sector has experienced an increase in funding but a decline in the number of deals this year, as investors grow more selective amid market overcrowding. In 2024, the Chinese GenAI industry closed 113 deals, approximately 20% fewer than the 143 deals recorded in 2023.
Recent discussions within the tech community have reignited the debate over whether Baidu may have laid the theoretical foundation for large-scale AI models before OpenAI. Dario Amodei, a co-author of OpenAI’s 2020 paper “Scaling Laws for Neural Language Models” and a former VP of Research at OpenAI, revealed that he had observed similar phenomena as early as 2014 during his time at Baidu.
China has introduced "LangYa," a cutting-edge AI model developed for high-resolution global ocean prediction, representing a major breakthrough in forecasting extreme weather events and ocean-related disasters. The upcoming LangYa 2.0 version will expand its capabilities to include forecasts for typhoons, precipitation, ocean waves, and sea ice.
China’s Ministry of Education has recently issued guidelines urging greater efforts to enhance artificial intelligence education in primary and secondary schools. By 2030, AI education is expected to be widely implemented across these levels all over China.
Chinese start-up DeepSeek has made a splash in the global AI industry with the release of its new open-source large language model, DeepSeek v3. Benchmark tests reveal that it outperforms rival models such as Llama and ChatGPT. What's most remarkable is that it was developed with just $6 million, a fraction of the $1 billion spent by OpenAI on ChatGPT4.
If you know of any other breaking China innovation news from December 2024 that I missed, do let me know so I can add it in next month’s newsletter!
?KEEP TUNED!
???? ???? ???? | Advocate for an inclusive and united human spacefaring nation | Key Note Speaker | Navy OF-4 Res. | opinions are mine
1 个月"Can you think of any other country capable of planning so far ahead - 46 years into the future?" No, but given the global challenges we are facing, this is what we need, instead of short-term profit and short-term agendas.
CIO, CDO, Digital Expert & Advisor, CISO
1 个月Thanks again Pascal Coppens for this awesome China update! Ali Adiby fyi #humanoids
Canine robots are contributing in disaster response in Tibet. Humanoid robots will soon be useful too, especially when they learn to operate bulldozers.