China Wants the Goose That Lays the Golden Eggs.
26th June 2024
China stands accused of wholesale theft of intellectual property, cited in Senate, House, and Administration reports, at a cost estimated by the FBI at $225 to $600 billion a year. Nonetheless, American corporations with the most to lose from IP theft are eager to augment their research presence in China. Take for example Intel Corp’s new chip innovation center here in Shenzhen, or Big Pharma, which lives and dies on patent protection. Nokia, one of the two main Western competitors to China’s telecom giant Huawei, conducts most of its R&D in Shanghai Bell Labs, one of the 10 largest corporate research centers in the country. The Chinese government counts 531 foreign-funded R&D centers in Shanghai alone. US companies spent $8.2 billion on R&D in China in 2019.
A visit to Huawei’s 2,000-acre campus in Shenzhen helps make sense of this cognitive dissonance, in which corporate America makes enormous bets on IP in a country that the FBI claims is stealing IP from them. The simple answer is that Chinese R&D is very good and getting better fast. More critically, Chinese IP theft isn’t simply a matter of this or that technological advancement. It’s much deeper and broader than that: it’s about claiming and replicating the source of innovation. China is engaged in what might be termed the boldest act of IP theft in world history, or to borrow a Woke expression, the most egregious act of cultural appropriation ever. It is “stealing” Western high culture.