Why has China, Japan and South Korea resumed economic dialogue?
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Hello and welcome to World Today, I'm Ding He in Beijing. Coming up, China's factory activity growth hit one-year high. China, Japan and South Korea agree to strengthen free trade. Pentagon chief praised the Japanese troops during a particular key World War II battle sparking criticism.

and China has issued first-ever operation certificates for autonomous passenger drones. To listen to this episode again or to catch up on our previous episodes, download our podcast by searching World Today.

China's manufacturing activity has expanded at the fastest pace in one year. The official Purchasing Managers Index came in at 50.5 in March. The sub-index for production edged higher to 52.6, and that of new orders climbed to 51.8, pointing to improvement in terms of manufacturing supply and demand.

In February, the official PMI figure spread to an expansionary territory from a contraction back in January. Also on Sunday, four state-owned banks in China announced plans to raise a combined 520 billion yuan or more than 70 billion US dollars to increase their ability to bolster the real economy. So joining us now on the line is Dr. Yao Shujie, Chang Kong professor of economics with Chongqing University.

So thank you very much for joining us today, Professor Yao Shujie. What do you think has made China's manufacturing activity expand at its fastest pace in one year over the past month? Is this sustainable expansion? Yes, I think there are two principal factors explaining the faster growth of the industrial sector and the Chinese economy in January.

The first factor is the full recovery after the COVID pandemic. The Chinese industry, services, consumption and manufacturing confidence have been gradually recovered to the point this year. It's now reaching the mature level.

The second factor is basically the slew of policies put forward by the central and the local governments to boost the economy at different levels and different industries.

For example, more neglecting financial constraints, and also the policy to boost the housing market, despite it still on the way of recovering. And also the boost for export, to diversify export to different countries, and also reducing the export and cross-border trade costs.

So all these kinds of policies are very conducive for the current economic recovery in China.

So, given the fact that US President Donald Trump's 20% additional tariffs on Chinese goods has been in place actually for most of the time in March, do you think it is fair to say that the existing US tariffs on China are having a limited impact on China's manufacturing industry including China's exports?

Yeah, the US-China trade conflict has been lasting for over eight years during the first term of the Donald Trump administration and also continued by the Biden administration. Now, this year also Donald Trump is in the second term. The policy we already expected that America is going to impose more tariff on the Chinese export to the American markets.

So the Chinese industry have taken quite a few years to adjust the export mix, not only for the United States, but also dilute it to other economy blocks such as ASEAN, Europe, Japan, South Korea, all these major trading partners, their share.

are taking away some of the share to the United States. I think the additional 20% imposed on the Chinese export to the US will certainly have a medium and longer term on Chinese export to the United States. But there are two reasons that Chinese export have so the resilience.

The first reason is that the Chinese manufacturing is probably the most comprehensive and competitive in the world. So even after the 20% increase of the tariff, the US consumers and the US domestic market still require a lot of Chinese goods, which are relatively good quality with lower price.

The second reason is that the Chinese export is not totally depending on the US market. After all, the US market only account for over just 10% of the Chinese total export. The other over 80% or close to 90% of China's export is actually directed to other economic block I just mentioned.

So there is a significant scope for the Chinese export to be highly resilient to the extra shock made by the second term of Donald Trump. So China, number one, is well prepared. Number two, I think the real effect by the US could be very illustrative. Okay.

Still, some analysts say that China's economy is on course for a slower growth in the first quarter of this year compared with last year's final quarter, citing weaknesses in terms of the services industry, for example. What is your take on this?

Well, you cannot compare the first quarter and the last quarter because different quarters have different seasonal adjusting factors. You know, each year in the last quarter in the Chinese economy is always relatively higher growth compared to the other quarters. So even the first quarter this year is not highly comparable with the last quarter. It is fourth quarter of last year.

It doesn't really matter. What matters is to compare the first quarter with the first quarter in 2024, like with like, which takes away the seasonal adjusted factors. And in my opinion, I think the first quarter this year seems to be far more positive than last year, the first quarter. This is because there are a number of factors we already discussed.

The industry has been recovering very well, and the government has lots of policies to prepare economic development and expansion in different corners of the Chinese economy.

So, by the way, Professor Yao, why do you think since the start of this year China's macroeconomic data have shown stronger industrial output and stronger fixed asset investment but weaker consumer inflation, for example? How can China achieve a more balanced growth?

Yeah, consumption behaviour is not totally dependent on government policy. Government policy has some effect on stimulating domestic consumption, for example, procurement subsidies, buying subsidy for some consumer items, for example, like vehicles, electronic products and other things.

But day-to-day consumption, for example, like daily necessity food and other things, the government doesn't actually need to step into the market because the food prices in China have been fairly stable.

And why the consumer is relatively more reluctant compared to manufacturing sector to expand, you know, production and consumption is because consumer, after a few years of

COVID-19 pandemic, they are still relatively conservative in terms of spending their money. So they are very cautious about the saving because the house prices still continue.

to be weak. So the people who used to be positive in terms of future consumption, they have to consider whether their wealth, dominated by the housing market, is going to recover for the future. And for the relatively lower income and non-houseowning people, they are probably about to save more money to go to the housing market to pick up the cheap.

So, this is a very complicated issue. We cannot single out which factor is throwing the consumption relatively lower recovery. This is a long-term process. I think if the macroeconomy is doing well,

employment, income generating activity of the general public, then consumers are confident with gradually recover and they're going to become the main preparers for China's domestic growth.

Okay, so with regard to the fundraising plans by these four major state-owned Chinese banks, of course, I mean, this is how China is trying to capitalize its big banks to help them boost the lending to revive growth.

Now, last year, some of those state-owned commercial banks were actually under some kind of pressure in terms of their profit margin due to various factors such as, say, the underperforming real estate sector, etc. So what do you think their newly announced fundraising plans might mean to their profit margins or to their earnings?

I think there are two purposes for the central government to support the big state-owned bank. Firstly, I think the economy we know has been weakening over the last few years, again due to the COVID pandemic, and also the slowdown in the housing market. We see there's a significant adjustment process in the ex-state industries.

And lots of lending activity, lots of profit-making activity are closely related with the lending to the housing market. And if the housing market is slowing down, it inevitably reduces the profit-making ability of the big industrial banks.

Another issue is because in order to boost the domestic economy, the central government and also the People's Bank of China, which is the central bank,

They adjusted the interest rate downward. And by adjusting the interest rate downward, the interest spread between the lending and the borrowing have been also reduced. And if the interest spread is reduced, then the profitability of the big state-owned bank would be also undermined.

Now, by undermining the profitability, that would also make this bank a little bit more vulnerable. So the purpose is to prevent the vulnerability.

of the big band when the market is getting more complicated. And the second purpose is to allow this big band to be able to lend more money to the real economy sector. By lending more money to the real sector, you can actually kill two birds in one stone. The first bird to be killed

is that the ban will become more resilient. And the second bird to be killed is to make the real economy more robust to achieve the economic growth rate set by the People's Congress. Thank you very much, Paul, for putting this into perspective. Dr. Yao Shujie, Chang Kong Professor of Economics with Chongqing University. Coming up, China, Japan, and South Korea agree to strengthen free trade. Stay tuned.

Hello, my name is Alessandro Golombievski Teixeira. I'm a professor of Public Policy and Management at Tsinghua University in Beijing. I am a great listener of The Wall Today. In my opinion, The Wall Today is one of the best China radio programs. In The Wall Today, we can get the best news and analysis in what is happening now in the world. So please, come to join us!

Welcome back. You're listening to World Today. I'm Ding Han in Beijing. China, Japan, and South Korea have agreed to boost trade cooperation. The three Asian countries on Sunday held their first economic dialogue in five years in Seoul. They agreed to closely cooperate for comprehensive and high-level talks regarding a trilateral free trade deal to promote regional and global trade.

They also agreed to strengthen the implementation of RCEP and create a predictable environment for trade and investment. The three countries began their negotiations regarding a trilateral FTA in 2012.

So joining us now on the line is Dr. Zhou Mi, Senior Research Fellow with Chinese Academy of International Trade and Economic Cooperation. Thank you very much for joining us. So what do you think has really prompted these three Asian countries to resume, let's put it this way, to resume their ministerial level economic dialogue?

Is it because of some self-driven dynamics between the three countries or simply because of some external factors, for example, U.S. President Donald Trump? Well, if you are trying to put that in that way, I would say that for the first reason, it is the most important reason that both or all of the three countries have the intention to cooperate.

We know that these three countries have a lot of similarities. We have shared some similar culture and also the supply chains are well connected. So the free trade agreement is a kind of important thing. And before that, I think that all the enterprises are really are thinking about how can we improve the resilience of the corporations.

If you are looking at the, you know, the institutions, the research institutions and also the banks of Japan and South Korea, they would like to come to China to observe what is happening here in China and trying to give the advice to the enterprises here in China. So I think that, you know, that is the first reason. But you mentioned China.

you know, Donald Trump, it is also true that when he came to the White House, it is a little bit different. So I would say that is also our important factor that all of the three countries resume the talk about, you know, how to improve the economic cooperation.

I guess no one really needs a reminder about the broader tension, including economic and trade issue tensions between the US and China. But what do you think the United States under President Donald Trump might mean to both Japan and South Korea in economic and trade sense?

Well, if we recall, eight years ago when Donald Trump came into the White House for the first term and he pushed South Korea to renegotiate the free trade agreements between the United States and South Korea, which has just concluded in the administration of Obama. So he said, Donald Trump, he said that it is a very bad negotiation and he forced South Korea to make more commitments

to open its market wider and trying to accept more quota about the import from United States on the automobiles. So I would say that Donald Trump also put a lot of pressure in Japan and they have to, you know, trying to do more concession in different ways, like for the fees for protagonism in the military bases and also have committed for better market access. So this term, I think that he requires more.

If we are looking at some of the facts that he may, you know, before he has offered, he has tried to raise some kind of concerns. Japanese government and also South Korea, they have given some offers to him. So I think that he will, Trump will be more ambitious in the economic demand from these two countries. Hmm.

So like I suggested earlier, Beijing, Seoul and Tokyo began their negotiations regarding a bilateral free trade agreement actually more than a decade ago. So over the years, what do you make of the key factors that have over the years prevented these three parties from reaching a particular deal?

Well, I think that there are maybe two reasons. The first one, that we know that there are some kind of historic problems between Japan and South Korea, especially when talking about World War II. And they have some kind of not so good atmosphere between these two countries. And the second, I would say that is also because of, you know, the world has changed. We are seeing so many uncertainties in the past decade.

And, you know, there are also some alternative free trade agreements like the RCEP and also the TPP. And then it came to be the CPTPP led by the United States. So many of these countries are trying to think about what we can do to meet the best of the, you know, the benefits of the people. So they are trying to make some different decisions. But to China, I think that we are always want to continue with this talk. I think that many of the countries

the Japanese and South Korea enterprises, they want it also because the free trade agreements between or among our three countries are quite different from the existing ones like what we have signed, just the China and South Korea and also of us involved in the RCEP.

In the case of China and South Korea, I remember it was back in the year 2015. And actually, the existing South Korean trade minister at the time, he was serving as a professor in a Korean university. He joined our show to talk about that very topic at the time. But that's another story. So by the way, Dr. Zhou, how do you think the three sides can gain sustainable momentum in their trilateral FTA negotiations?

I understand that the developing levels of China, Japan and the South Korea is a little bit higher. So for all of these three countries, we have our own advantages. I mean, that is not only about to reduce the tariffs on the imports and exports for the goods, like we have a benefit allowed by the supply chain, vertical cooperation.

in the monitoring sectors, automobiles, and some of the TV or refrigerators in the past. But it is even more important for the trade-in services. So I mean that many of these measurements will be taken care into the measurements for the market access for the foreign service provider and suppliers.

And it is also true that investment is another important issue. So we are seeing that the world is trying to look at some new issues like for the e-commerce, cross-border data flow, the environment issues, something to do with carbon trade or other things to do with green development and digital economies. So I hope that all of these three countries can try to not

not look at the traditional aspects, but also trying to give more certainty for the companies who are involved in those new and leading or aging sectors. So it is really no secret that China, South Korea, and Japan, all of them are participating in the RCEP program.

So what do you make of the potential role that the RCEP can possibly play in terms of enhancing trade cooperation between the three countries? Well, RCEP is, you know, for the size, it's number one in the world. We are seeing that it is growing very quickly in the past several years after it has taken into effect.

So the supply chains are strengthened and also enhanced by not only for these 14 countries, but also attracting more members, more countries' interest, like for Hong Kong and also for other countries and regions. They want to join RCEP.

So for the three countries of China, Japan and South Korea, we are the leading partners, I mean, for the development, you know, for the scale of the economy and also for the trade intentions. So I also, you know, giving some of the lectures to South Korea, if they

They invited me to give them some advice on how can they make the benefits of RCEP to invest in the ASEAN countries. So I hope that it is also important for us to try to continue with, you know, the unfinished parts of RCEP.

that we have promised by all the RCEP members that we will continue to move on from the nowadays status of RCEP, like including more open and more transparent ways of dealing with investment and also giving more support for, you know, different stage of the countries, like some of the least developed countries.

So I believe that all these three countries have the intention to improve the connectivity and also to improve the standards of RCEP.

So the final question before we let you go briefly, what do you think is the ultimate meaning for pursuing closer trade and economic ties between China, Japan and South Korea? Are we talking about safeguarding, say, the spirit of free trade or multilateralism? Or are we talking about, say, trying to make our regional or even global supply chain system more resilient or something else?

Yeah, in my understanding that all of them are the reasons that we want to improve. We want to give some good examples to the world in the multilateral system, and we're also trying to show the world by the cooperation that all these three countries can benefit by better complementary development and more sustainable development. Thank you very much. Dr. Zhou Mi, Senior Research Fellow with the Chinese Academy of International Trade and Economic Cooperation.

More to come: Pentagon chief praised Japanese troops in a World War II battle sparking criticism; China issues first-ever operational certificates for autonomous passenger drones. You are listening to World Today. To listen to this episode again or to catch up on our previous episodes, download our podcast by searching World Today. I'm Dinghan in Beijing. We'll be back after a short break.

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You're back with World Today, I'm Ding Hen in Beijing. U.S. Secretary of Defense Peter Hacksas has sparked controversy after he praised the Japanese who fought on Iwo Jima. The 1945 Battle of Iwo Jima between the United States and Japan was one of the bloodiest battles in the Pacific theater of the Second World War. Hacksas on Saturday attended a memorial service on Iwo Jima during a trip to Japan.

He said, the bravery of those who fought on the battle, Americans and the Japanese alike, endures in history. Japan was the second-in-the-lack of the American Defense Chief's first-ever Asia tour, which has also taken him to the Philippines. So joining us now on the line is Dr. Rong Ying, Chair Professor with the School of International Studies, Sichuan University. Thank you very much for joining us.

Thank you for having me. So, I mean, Professor Rong, to put it bluntly, the U.S. official, the U.S. defense chief, he was openly praising the Japanese fascism-related troops and behavior in history. In your understanding, in your observation, what could be behind this arguably problematic behavior?

Well, I think it only tells loud and clear the ignorance of Hexes, but I think more notably his erroneous outlook of history, which I think demonstrated the United States, I mean, this administration's naked pursuit of selfish geopolitical interest

without regard or anything about the right and the wrong of history. I was really shocked and outraged by his remarks.

And I think the veterans present, American veterans present at the ceremony and that the dissidents of these brave American soldiers would ask us a question. What kind of message Hexet would like to send out and what's wrong?

and that he or his admission has been going. And so there are, I think his remarks and the way that he praised the fascism of Japanese militaries,

He owed an explanation, owed an answer to these people and also the future generations of the United States. I take your point. So China was a focal point for the first ever Asia tour of HACSAS. That's

For example, when he was in Tokyo, he said to his Japanese counterpart on Sunday that the US and Japan share a quote-unquote warrior ethos in terms of tackling the so-called Chinese aggression. How dangerous is his comment here if we associate this with what he said about the battle for Iwo Jima?

That's exactly, I think, the danger where I think lies. Because when we talk about, I think, the history, when we talk about the right and wrongs of the war of resistance against Japanese aggression in the case of Chinese, and also I think the word sort of anti-fascist war, we're talking about

not only i think kind of a command memorizing the history but more importantly i think we need to try

treasure the peace to prevent the recurrence of that. So if it goes like what Heges says, that would, I think, cause more problem. More problem to the fact that the root causes of what happened more than 80 years ago

was because the Japanese imperialism, they for the sake, I mean, because of their belief in force and because they want to seek

expansion, disregard of humanity, disregard of morality, disregard of the human rights of all the country, I mean the region, including I think the POWs of the United States that have been cut.

And if we go along this line, then we are totally have a wrong sort of outlook. More important, of course, China has always said that we are the force for peace. And China has always uphold, pursues a peaceful road for development. And of course, China has also made it very clear

Eight years ago, I mean, more than eight years ago, China fought bravely to defend its sovereignty, territorial integrity. Eight years now, China has even more capabilities. So don't have any sort of doubt that China will resolutely defend its own independence

and a legitimate right but that's totally different with the so-called warrior assholes uh hesitant had a test that has been advocating so i think we need to have a really really a clear understanding of the historical lessons and the root causes of what happened that is under respect huge respect of our martyrs of our i mean the sacrifice that uh i mean our waters that are being

has made in terms of life and everything. So, Professor Rongyin, we still have about 90 seconds before we need to let you go. So briefly, I mean, over the past weekend, we actually saw China, Japan, and South Korea holding a ministerial-level meeting in the city of Seoul to discuss how to resume their negotiations on a trilateral free trade deal.

But exactly at the same time, the US defense chief was in Tokyo talking to the Japanese about a possible war with China. What do you think this tells us?

Oh, that only tells us that the United States is the force of disability, is the force that does not want to see the countries of the region through their efforts for reconciliation, for dialogue, for communication, to promote

peace to address their differences. So I think that is the clear message that this visit of United States, I mean, Secretary Hedges has sent out. But more importantly, I think the countries and regions are clearly wary of that, and I think they are determined

to take whatever efforts needed to guard against any efforts that has been tried to divide or manipulate the differences

and the efforts for unity and for peace in the region. Thank you very much for joining us. Dr. Rong Ying, Chair Professor with the School of International Studies with Sichuan University. Coming up, China issues first-ever operation certificates for autonomous passenger drones. This is World Today. We'll be back.

Two Chinese companies have received the first-ever operation certificates for autonomous passenger drones. The Civil Aviation Administration of China issued the documents marking the start of commercial operations in China's low-altitude aviation sector. It is also a milestone in terms of China's development for its low-altitude economy and urban air mobility.

The operator certificates confirm that the autonomous passenger drone meets the country's safety standards. Companies with certificates can carry out commercial operations in approved areas or airspace to provide paid passenger services.

For more, my colleague Zhao Yang spoke with Yan Liang, professor of economics with William Matt University. So Yan, two companies received the first ever operation certificate for autonomous passenger drones from the Chinese regulator. So what kind of a flying business can they carry out? And what does this mean for the low altitude aviation sector in China?

Well, I think there are many possible areas of businesses that these companies can carry out. So I think one of the important functions of these companies is to improve the urban air mobility. So in other words, they can offer intercity commercial passenger services, you know, carrying passengers from one seat to another.

with the other. Especially, I think this is important for the Great Bay Area. For example, the 11 cities are trying to improve their mobilities between the cities within, you know, an hour of transport time. So this is going to be a big area for these companies to operate within. There are also other possible areas, like, for example, low altitude tours for

urban sightseeing, for logistics and for some other transportation functions. So I think there are many possible operations and this is really a taking off moment, I think, with these two companies getting the operations certificate to start experimenting these different business operations.

And the low altitude economy has been emphasized and encouraged by the Chinese government. China's top economic regulator established a department for the low altitude economy. So what's the background of it? And why does China listed it as one of the country's strategic emerging industries?

Yeah, so I think this is really the broader trend of trying to promoting the more technological intensive, the emerging industries. So just like the EV as a new breakthrough in transportation means, and this is another area I think that has great potential to explore.

And I think China really puts this as one of the strategic sectors for three major reasons. One is that I think, again, this is just like the e-vehicles. People are looking for not just transportation on the ground, but all these transportation possibilities on the air.

That is also going to streamline, you know, transportations and commute between cities. And so that would provide a new innovative ways of commuting, of transporting. So I think this is a great potential. And second is that building on China's already, you know, the cutting edge technologies in the EV space.

I think it's really not a big leapfrog to build the so-called flying car. And, you know, as we know, the Expo has already been building these flying cars. They have also these so-called land carrier craft where the cars could store a, you know, flying drones in the trunk.

So this is already take advantage of the already very strong capacity in building, you know, these land rolling vehicles. And so this is going to be a extension of the current industries in the EV and other industries. And last but not the least, I think this is also a general purpose technologies. So we know this is not going to be just, you know, one vehicle.

sort of manufacture new product, but it's really are able to apply to different industries, right? Like the service industries, you could use it for tourism, you can use it for transportation, you can use it for ride sharing and so on and so forth. So this is going to help with a really strong spillover effects to the many different industries and help to boost

productivity and efficiency when it comes to tourism or transportation. All of these, I think, would be very helpful when it comes to productivity gain. And so how can the low altitude economy change the urban air mobility? What are the commercial applications of it in various sectors such as industry, agriculture and services?

Yeah, I think this is a great question. So as I mentioned earlier, the trend going forward is to be able to use these so-called electrical vertical takeoff and landing aircraft or eVirtual to facilitate the intercity, the urban air mobility for logistics, for sightseeing and so on and so forth.

So now, China has already, many of these companies have already conducted various trial flights. So for example, one of the companies that received the operational certificate is Yihang. They have completed more than 60,000 safe flights. And so this is really going to pave the way for the mass application of these kinds of flying vehicles or the eVTOL to the various industries.

So it could be in aquaculture, right? You could imagine using these e-bottles to spray fertilizers, to deliver seeds and so on and so forth. It could be used for services like we just mentioned, just like the e-taxi.

this would be a flying taxi scenario, and also for industries in the sense that you could help to bring different compartments or parts from one locations to another. So there are many possible applications when it comes to commercial applications for these eVirtuals, and they would really help to streamline when it comes to transportation, when it comes to urban mobility, really shorten the time of travel and also relieve some of the underground

congestion when it comes to traffic jams and so on and so forth. So I think this is great in terms of the potential. And the market size of China's low altitude economy is projected to reach 1.5 trillion yuan this year and could expand to 3.5 trillion yuan by the year 2035. So what are the business opportunities in this sector?

Well, like you just mentioned, this is a very large market. So there are many companies who could, I would say, work on the different parts of the supply chain with the big, you know, the sort of the ecosystem of the low altitude economy. You could have companies like Yihang and also this other one that received the certificate is from Hefei. Hey, it's

So companies could manufacture these e-vitals. But there are also companies who could, for example, rent these e-vitals and operate in rental operation. Then definitely other businesses could purchase all these e-vitals for urban sightseeing, for tourism, for logistics, and just for commute services. So it depends on different companies, their own market niche.

There are many different possibilities along the supply chain that companies can operate on. So this is why I think, as I mentioned earlier, this is a general applied technology, general purpose technologies that companies could work on the manufacturing side or on the service side or on the customer sort of the booking and some other logistics areas as well and rental.

So I think there are just different segments, right, along that supply chain that we could find the business opportunities for companies. And as you mentioned, the low altitude economy is booming in China. So what is the global landscape of it? And how has it been developed in other countries like US and Europe? Well, I think China is really developing it in a very systematic way. Like you said, from the central government that really

provide a blueprint in terms of setting this industry as a strategic industry and provide a lot of incentives for local governments to build infrastructure, to provide standards and regulations, and also incentives for companies to operate. So I think it's a very systematic approach, just like

the way that China builds the EV ecosystem is not just the manufacturer side, but it's, you know, from the very beginning, developing the batteries and also develop a lot of the infrastructure, including, you know, high speed highways and also railways

rail to connect these city to city, to allow people to use the EVs for not too long distance driving. So there's a lot of different, I would say, areas to be able to build that ecosystem. And the same thing with that low altitude economy. So I think right now, the Chinese government is really spearheading, mobilizing these different

companies to develop the technologies to manufacture, to utilize the Chinese large manufacturing bases. Because to make this cost effective, as one of the questions that you asked earlier, you need to mass production and you need a large economy of scale. You also need really good materials and battery storage

technologies and so on and so forth. And so I think China is really leading in many of these technologies and productive, you know, when it comes to capacity. When it comes to the United States, there are companies, they're very good in developing the technologies, right, in building these EV tolls, but I'm not seeing a very systematic approach

Professor Yan Liang, a professor of economics with Willamette University, talking to Zhao Yang. This is World Today. Stay tuned.

You're listening to World Today, I'm Ding Hen in Beijing. Technology incubation institutions and global investors are exploring cooperation opportunities in cutting-edge fields like artificial intelligence at the Zhongguancun Forum Annual Conference. It is a key Chinese forum showcasing Scientech progress.

During the quote-unquote Invest in Beijing event, the Chinese capital city has announced the 215 projects with a total investment exceeding 13 billion U.S. dollars. That's nearly 6% higher than the number recorded last year. The theme of this year's event is quote, new quality productive forces and a global science and technology cooperation, unquote.

For more, my colleague Ge'an Na spoke with Andy Mock, technology analyst and a senior fellow with the Center for China and Globalization. Andy, during the forum, Beijing has unveiled a total of 215 investment cooperation projects, and the total investment signing amount has surpassed $13 billion. What do you make of this figure? What does this signify in your opinion?

Well, I think this is another important milestone in China's journey to being a global technology leader. And I think what this shows is that there's tremendous global interest in working with China in the technology field. And it's well known that China offers an enormous market. But increasingly, China can also bring technology leadership to the table in an increasing number of fields.

So, of course, it started with batteries, electric vehicles, but more and more we're seeing things in, for instance, so-called embedded AI, biomanufacturing, quantum computing, 6G, et cetera. And I think this is the simplest explanation for why we're seeing these kinds of numbers and this kind of momentum emerging.

at this year's Zhongguancun Forum. We've seen a lot of exciting high-tech breakthroughs announced at this year's forum. Which ones do you think will have the biggest impact on our daily lives and key industries in the near future? Well, I think in the short term, meaning the next maybe two, three, five years, I think one of the biggest changes and the impacts we'll see in our daily lives

are the rise of humanoid robots. And this is something that China has decided is a priority. And I wouldn't be surprised at all if within five years we see similar technology breakthroughs as well as adoption that we've seen with the new energy vehicle industry, particularly EVs in China. So I think this is something that is very exciting and we'll see in the next couple

few years, a little bit longer term. I think quantum computing is something that has enormous disruptive potential. And it's still early days. You know, there's still enormous technological challenges. But China, again, has declared an intention to be a leader here and I think is making meaningful progress. But this is probably a little further off than, you

humanoid robots or some again some would call it embodied artificial intelligence then building on that looking at the bigger picture how do these innovations contribute to China's high-tech sector upgrade and what unique value in your opinion do they bring

Well, the way I think about the Zhongguancun Forum and other events like it is that they are like an estuary. So an estuary is a place where freshwater rivers meet with the ocean. And of course, the sea is saltwater.

And this mingling actually produces enormously vital forms of life. And I think this is what we're seeing here as well. And I think this is some of the implications. And obviously, there are challenges. There are technological challenges that need to be overcome. There are geopolitical challenges, largely geopolitical.

caused by the U.S.'s fear of China's technological development. But I also think that these kinds of

challenges are double-edged swords and that at the same time, I think they only strengthen China's resolve, the government's resolve, as well as the resolve of individual entrepreneurs in China to make breakthroughs even more quickly than they might otherwise. Speaking of challenges, there has been a lot of discussion at the forum about turning technological advancements into real-world applications.

What steps has China taken so far to move high-tech innovations from the lab to the market? How effective has this process been, and what challenges still need to be attacked in this realm? No, that's right. I think that this is something that China has shown

a strong capacity, I would say perhaps even a unique capability to bridge the gap between research development and then ultimately successful commercialization. So we've seen this before with solar panels. We've seen it more recently with electric vehicles. And again, you know, if history is any guide, we may see this with humanoid robots because this requires further advances and breakthroughs

At the theoretical level, as well as the implementation level for the AI algorithms that allow robots to function like humans in the real world. And it also requires advanced manufacturing breakthroughs as well. So the actuators, the joints that are the equivalent of human joints in a robot, also require more research development processes.

and other types of commercialization. So I think we can see that the low altitude economy, I think is probably another that maybe is less technology driven. But again, how do you get something to market and to safe widespread adoption? Earlier, you mentioned another challenge from the United States as President Trump escalating restrictions on China's high tech development.

But even with the current complex China-U.S. relations, China's technological advancements continue to draw global attention. This year, the forum has attracted numerous international organizations, research institutions and enterprises seeking collaborations with China. What do you think is driving their decision to choose China as their partner in the high-tech sector?

Well, I think, you know, certainly a part of it is China's organic growth as a market and as a science and technology center for global advances.

But at the same time, as I mentioned, I think the U.S. initiative, not just under Trump, but Biden as well, to slow down China's technological rise has in fact had the exact opposite effect, as I mentioned, causing China to accelerate its own technological development. But I think also putting a lot of pressure on

on other companies and countries around the world who may not necessarily want to go along with this. You know, I'll point out the Netherlands and ASML as an example. So they rely a lot on China as a market.

And, you know, I think many companies around the world are really developing a much deeper ambivalence about whether they want to be part of what many are starting to see as a failing effort by the United States to slow down China's technological rise. I think this is, you know, what I see going on. That was Andy Mock, senior fellow with the Center for China and Globalization, talking to my colleague Ge'an Ngoc.

That's all the time for this edition of World Today. A quick recap of today's headline news: China's factory activity growth hits a one-year high. China, South Korea and Japan agree to strengthen free trade. Pentagon chief praised Japanese troops in a particular World War II battle sparking criticism.

To listen to this episode again or to catch up on our previous episodes, you can download our podcast by searching World Today. I'm Dinghan in Beijing. Thank you so much for listening. Bye for now.