China steps up quantum computing, AI efforts as competition from U.S. heats up: Report

China plans to step up efforts to strengthen its technological capabilities in quantum computing and artificial intelligence (AI) as competition with the United States intensifies, according to a new report.

The government work report highlighted the need for China to strengthen local capabilities in emerging technologies amid mounting sanctions on key hardware and technologies from Western powers.

AI has become the latest field in which competition between China and Western powers is intensifying. The United States has imposed sanctions on Nvidia (NASDAQ: NVDA), AMD (NASDAQ: AMD), Intel (NASDAQ: INTC) and other U.S. chipmakers to derail China and prevent them from shipping high-end chips to the United States. In response, these companies manufactured chips with only a fraction of the processing power for Chinese users.

A government document says Asian countries should invest in nurturing domestic manufacturers to compete with Western rivals, Reuters reported.

“We will make full use of the strengths of the new system for mobilizing resources across the country to increase China’s innovation capacity overall,” the government report said.

Alfredo Montufar-Helu leads the China Center at the Conference Board and said China’s focus on emerging technologies is part of President Xi Jinping’s efforts to elevate the country to global hegemony. He added that this is in line with last year’s Central Economic Work Conference, which focused on technological independence.

The Central Economic Work Conference is an annual meeting where Chinese leaders set the agenda for the financial sector.

In addition to AI, the report explored quantum computing, calling for more investment for China to take the lead in the rapidly evolving field. As with most technologies, China is competing with the United States for quantum supremacy. But unlike AI, the gap is much smaller.

Guo Guoping, China’s top quantum computing scientist and lawmaker, recently emphasized how important this technology is, saying, “Establishing an independent industrial chain in this field has become one of China’s top priorities.”

Quantum computing could have a profound impact on China’s military capabilities. Experts believe that quantum computers can easily crack all existing encryption methods. There’s even a name for the day when all existing encryption becomes obsolete: Q-day. Some experts believe this could be as early as next year.

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