Welcome to the Arena: Who’s Ahead, Who’s Behind, and Where We Are Headed Next in the U.S.-China Technology Competition
Introduction
The intensifying technological competition between the United States and the People’s Republic of China (PRC) represents one of the most consequential dynamics shaping the 21st century. This rivalry encompasses critical sectors that define economic power, national security, and global influence. Both nations are advancing rapidly across emerging technologies, with strategies that reflect starkly contrasting priorities, governance structures, and resource allocations. This report, Welcome to the Arena: Who’s Ahead, Who’s Behind, and What’s Next in the U.S.-China Technology Competition, aims to provide a comprehensive, data-driven examination of this evolving landscape, building upon the foundation established in the Special Competitive Studies Project’s (SCSP) 2022 gaps analysis.[1]
This document is designed to fulfill five key purposes:
- One-Stop Diagnostic Resource for Policymakers: Tailored for the incoming Presidential Administration, the report serves as a strategic guide, identifying opportunities, challenges, and insights to inform technology policy and decision-making.
- Analysis of How Nations Prioritize Critical Technologies: The report examines how various stakeholders within the U.S. innovation ecosystem prioritize key technologies, revealing strategic alignment and divergence across sectors.
- Update from SCSP’s 2022 Gaps Analysis: This report incorporates new data and developments – across twelve strategically critical technology areas – reflecting significant changes in the technological and geopolitical landscape since 2022.
- Forecast Geopolitical and Technological Trajectories: By analyzing trends, investments, and strategic initiatives, this document surveys potential geopolitical wildcards and forecasts possible future trajectories of these key technologies and their implications for the global competition.
- Simulate the Functions of a Theoretical U.S. Technology Competition Council: By providing a structured and holistic analysis, the report demonstrates what a dedicated U.S. Technology Competition Council’s output might look like, emphasizing cross-sector collaboration and actionable assessments.[2]
This report seeks to equip policymakers, industry leaders, and researchers with the state of play needed to navigate the U.S.-China technology competition. By identifying areas of strength, vulnerability, and opportunity, it provides a roadmap to strengthen the United States’ position in the global innovation ecosystem while ensuring long-term resilience and competitiveness. The following sections delve into each technology area, presenting a nuanced analysis of where the United States and China stand today, and where they may be heading in the years to come.
[1] Methodology Note: In 2022, SCSP conducted a gap analysis (“Gaps 1.0”) of twelve technology areas that we believed would drive the competition between the United States and China from 2025 to 2030. Now, three years after our initial analysis, we thought it would be an opportune time to revisit our previous assessment and do a comprehensive update. These twelve tech areas are derivatives of a broader set of strategic sectors we judge to be central to building national competitiveness (Mid-Decade Challenges to National Competitiveness): artificial intelligence, biotechnology, advanced compute and microelectronics, advanced networks, advanced manufacturing, and next-generation energy. We used a framework of analytic questions to select and examine these tech areas through three lenses: tech phenomena, competition factors with China, and the state of the U.S. innovation ecosystem (Harnessing the New Geometry of Innovation). We assert that the evidence selected for these conclusions should be a mix of quantitative and qualitative metrics of actual fielded capabilities that differ for each technology, using secondary variables like publication trajectories as indirect proxies for understanding real positional advantages.
[2] The National Security Commission on Artificial Intelligence (NSCAI) in 2021 proposed the establishment of a Technology Competition Council (TCC), a recommendation that SCSP has echoed, to empower a single entity in the White House to set strategic direction and oversee a coordinated approach to technology competition. Furthermore, SCSP has proposed that the TCC and/or a new supporting entity such as an Office for Global Competition Analysis, conduct regular comparative analysis of U.S. and adversarial technological capabilities to better inform policymakers on how to prioritize resources and policy agendas. See Final Report, National Security Commission on Artificial Intelligence at 166 (2021); Harnessing the New Geometry of Innovation, Special Competitive Studies Project at 49 (2022).