Unknown

[Music] [Music] [Music] good morning everyone uh good evening for those in China uh good afternoon for those in London it's really a pleasure to have you all here today uh I'm Lisa vahal and I'm a senior fellow for the Asia uh unit of SE uh we're H very happy to have this conversation today with very special guests that decided to accept our invitation and join us for a discussion on China's um Innovation uh digital Innovation and the transformation of its industrial based strategies so on behalf of the Brazilian Center for international relations I would like

to thank uh our sponsor uh the bom BBM bank for helping us keep the China analysis group um running throughout the year with different events and this is uh one event that is part of the China analysis group uh program uh I would like to uh briefly tell you uh a bit about our speakers we will have Professor J speaking from The Institute of new structural economics of ping University of China uh ping University as you know is a leading uh um educational institution in China very well-known University so really happy uh to have Professor

jayu join us here um we are also having uh Ruby Osman here with us she's a specialist on China and geopolitics at the Tony Blair Institute for Global change Ruby speaking to us uh from London she has a very impressive uh portfolio of uh works and articles and studies that she has developed and she also got incredible opportunity of uh interviewing uh Kissinger uh this is part of her CV uh which is really impressive uh as well uh so today uh we will talk about China's uh Innovation and uh digital transformation strategies we all know

that China does not want to be the chap manufactur days of the world they have been talking about that uh quite a lot recently the Chinese government has been making a lot of statements and producing documents about this uh topic and as a series of policies have been launched uh to Foster or try to Foster the country's Innovation and digital transformation uh to the point that the phrase new new quality productive forces has become quite a popular term in China and among uh China Watchers we're listening to that uh very frequently uh China is currently

the world's second largest digital economy and uh Professor jayu will talk about that but the China Academy of information and communication technology says that out of a total of 38 trillion Us doll the estimate size of the of digital and Global economies that the US takes about 40% of that total and China rank second with about 20% so 40% for the US 20% for China so China is already a a big digital economy uh but it it wants uh to go further on that um and today we will get a chance to learn from Professor

J and from specially Ruby Osman about China's industrial and digital strategies and the context of its goal of creating an Innovative and Technology based economy we will hear about the goals but we will also hear about the hurdles and difficulties uh of really implementing this uh ideas and sometimes um it's let's say easier said than done so we will uh discuss what are the hurdles and what are the potential impacts of these decisions and plans to China forign China's Foreign Affairs uh China's International cooperation and to countries like Brazil uh we obviously very interested always

on the impact of these policies that are being um shaped in China to Chinese foreign direct Investments to Chinese financing in the world and how that can also affect us here in Brazil so so thank you for joining us today and uh I will welcome Professor J to start her talk and to give us her presentation so the idea is today is that we will have each speaker uh making an initial presentation of about 10 minutes and then we will open um the floor to a Q&A session as well so thank you for being with

us and Professor J the floor is yours okay thank you Larisa for the very warm words so uh today it is my great pleasure to join this uh seminar and uh okay since the time is very limited I will okay I will go directly to the uh uh for the presentation so there are in total three parts just I really want to share with you the first part is about the digital economy in China today and then the second part is about interaction or the international cooperation in digital economy uh in China and also with

uh uh other countries and the third part is about the the blueprint of future if we look forward what is uh the the future um development Trend in digital economy in China so firstly in China we already see that um we have a very diverse uh scope of digital economy such as digital product manufacturing industry for example like the computer manufacturing and other uh uh hot soft uh Hardware uh manufacturing and also we have digital product service industry for example the sales of digital products and we have also the digital technology application industry like the

S uh the software development and as well as the like the man application and we also have the digital element driven industry as well as the efficiency Improvement for example the digital agriculture application and uh as Lara already mentioned that according to a study conducted by uh China Academy of information and communication technology today where can see that uh there um is a hug huge gap in development of the digital economy between the developed country and developing country for example yeah like United States is the number one in digital economy development with 40% and China

that is more than twice than the second place than China and also um we have a very huge uh expansion if you can um Professor J sorry to interrupt but I just wanted to mention your slides are are not going through I'm not sure if you're passing them or if you're just uh we can only see the the cover of your presentation the first page okay but uh now it's it works now no not for me yet I think you have to uh yeah it is mode right yes maybe you just click on the number

of the slide that you like to show yeah can yeah I I'm just click uh clicking the different slides can you can you see now the different slides no okay I I will I don't I will stop and I will restart I perfect yes thank you so how about this time is it works uh I can still only see the first slide I don't know if you're trying to move them to the other slides oh now yes now yes now yes yes okay great so I will keep but I uh if for screen I okay

I will do like this so you can see now no problem great yes no problem yeah okay so now uh accounting to the figure it is we can see that the um the digital economy in China way the scale is uh with very much expansion so uh just the last year the scale of China's digital economy reached more than 53 trillion Y and also uh the contribution of digital economy growth to GDP growth reached more than 66% so that just support the stable economic growth in China and uh also we have like people um mentioned

uh many times we have industry digitalization as well as digital industrialization so I I think um you you know the difference between these two concept so I will not go to details to explain this uh the difference however we can see the structure if we look uh in in the details of the structor of China's the digit the industry digitalization and the digital industrialization we can find there is for example last year the proportion of digital industrialization and the industrial digitalization in digital economy in China was 18% versus 80% so we can see that the

industrial digitalization uh is much higher than the digital industrialization and um that uh figure just shows a penetration rate of digital economy in the primary secondary and the tertiary industry so we can see in China just take last year as an example the penetration rates of digital economy in China's primary um uh industry is about 10% and the secondary industry is about 25% and also 45% into the tary sectors however we can see yeah uh if if we look at the absolute value the tary sector uh Domin dominant however if we explain or analyze in

details we can see that last year it is the first time that the uh the growth rate of digital economy penetration in the secondary sector already exceeded that of the tary sector yeah so that is the big difference uh for last year okay so the first part is about the digital economy development in China so now we will talk more about the the international corporation especially today as people know that in China we have B and Road initiative and um furthermore in the field of digital economy we have the digital Silk Road so that is

an integral part of China's batt and Ro initiative so this in initiative or the digital Sil Road the aim is to enhance the digital connectivity and cooperation among the participating countries by promoting the development of digital infrastructure so for example like highspeed internet and Cloud computer etent so uh by the end of last year China has already SED the e-commerce cooperation agreements and established a bilateral mechanism with 30 countries so uh that indicate the active engagement in the digital Silk Road related activities and we have the uh for example uh many uh project especially the

digital infrastructure project for example we have the Asian direct cable with in total more than 9,400 kilometers that many um Asian country like yeah China Japan South Korea and other countries are connected by this project and we also have two uh Flagship submarine uh Cape project like the peace project and to Africa project so the first level is the regard to the digital infrastructure so it is the basic of the digital development and also we have the digital manufacturing for example many uh very famous Chinese compan companies especially the manufacturing companies such as it is

a very famous uh um household uh white goods uh electronic company in China so this company already uh they developed the the ecological park with uh like the first digital twin industrial park in both Middle East and and Africa and also they like uh they use the leading technology ologies such as Internet of Things Big Data artificial intelligence to build our digital par Park Bri to manage the park that is visible in all elements so uh it can give a very good control of like the uh uh achieving the digital secure and green operation of

the park and also we have if we talk about uh we already talk about the infrastructure about the manufacturing and we also have like the e-commerce so if we look at in detail about the crossb eCommerce we can see uh just to take the year uh 2022 as an example uh the total uh trade amount already more than two trillion uh uh rmd so and the top 10 countries in China's crossb Commerce um uh in the year 2022 are the United States and other um the major Asian countries yeah so that is about e-commerce development

okay so the uh the last part is about the blueprint or the future um plan for the digital economy or digital industry development in China so if we look forward we have like a framework of 2522 so I will explain to you so it's just like uh overall layout of digital China construction so we have the uh this plan encourage the international corporation and exchange and actively participantes in global digital governance and promotes the formation of a mutually beneficial Global digital economy pattern so I will explain one by one so if the two the first

two represent the major foundations so so that means digital infrastructure plus the data resource system so the digital infrastructure is a very uh easy to understand like the all the the hard uh the hard infrastructure uh the the network 5G data centers and also the data resource system involves like the collection storage precising analysis of all the data so that is the two major foundations and also we have a five in one in integration that means we this refers to the Deep integration of digital technology with the the number one economic number two political and

cultural social and ecological civilization construction so this what what means that will help promoting the digital transformation across the various fields and levels using like digital technology to enhance the governance efficiency essential and to guarant the uh like the public service and besides we also have another two uh another two to the first is M two major capabilities that means the digital Technology Innovation System and the digital security barrier that means yeah the Innovation is very easy to understand is about the R&D investment plan and in order to maintain the competitiveness in the field of

digital technology and also if we talk digital security it is uh just uh it's it will Target to to every every people and it's about our privacy it's about the network security data security yeah so it's the crucial part for uh the uh the the the a healthy development of digital economy and lastly another two uh the last two is about two environments that that means a domestic environment and the international environment so a domestic environment that means um the government need to create the policy uh like the uh the market and legal environment conducive

to the development of the digital economy and also regard to the international environment it is important to actively participate in global digital governance and promote the formation of open Cooperative uh and uh uh very healthy system so uh by the conclusion is actually uh today many developing country can benefit from China's support in digital Economic Development from Full perspective the number one is about infra infrastructure and then the second is about technology transfer and like also the human uh resources the uh capacity building and number three is a financial inclusion especially with like the digital

payment system and also the financial technology and lastly the regional integration uh enhancing connectivity and cooperation among the developing countries yeah so that is uh from my part I I yeah okay just 10 minutes so uh actually today our team we are not only a think tank but a think plus two tank so we have conducted uh like many project in different developing countries and so there there is just just a general list of uh the countries that we have projects okay so thank you very much and I'm looking forward to uh uh have more

interaction with you thank you thank you thank you Professor J uh it's interesting that you highlight the aspect of think and do uh t as Sab is uh also going through a similar experience now with a re think thing uh as we celebrate our 25 years of existence uh I will now pass the floor to Ruby Osman to conduct her talk please Ruby the floor is yours great thank you Lissa and thank you Professor you let me see if I can get this Tech working it's always a problem when the tech stops working it's especially

bad when it's Tey of course we need to have Tech problems let me see um is that coming up as a slideshow yes it is perect okay let me know if it stops moving but we'll give it a go but yeah um thank you so much for having me today and I should open with the caveat that I am not an economist so it's great to be joined by Professor U who is brilant on that side of things um so on my end I wanted to try and focus in a little bit instead on the

politics that underpins sort of some of these shifts towards and really all out focus on Innovation that Lissa was touching on and I think the first thing it's really important to say about China's Innovation Drive is this is something that is now baked in at the very highest levels of power and I think if we were to sum up in very simple terms what it is that Central leadership's trying to do it's to me China away from its old economic model one that sort of prized GDP growth at all costs to a slower more sustainable

model driven by Innovation I think this is what leadership tends to call high quality development and I think it's also partly a push for greater technological self-reliance in general that can help build China's resilience to external pressures in particular those pressures coming from the US um I think it's also important to say here that although we've really seen this focus on Innovation ramp in the past few years it's not come from nowhere I think there's always been a real concern and preoccupation among Chinese leadership about Security in a very expansive sense so that's not just

your traditional military security it's also an attempt to be more self-reliant in things like food security energy security and now as we're seeing here uh te technology as well I think as well leadership knew that the old growth model wouldn't last forever I all GE political tentes deci side it's there a limit to how long you can keep delivering double digit growth it's just economically tricky but the thing that has in the past few years really kicked this into overdrive is those tensions with the US which I think has made it quite clear that the

AIM now is to maintain as large a lead as possible over China and some of those key Technologies of the future and to do that it is willing to restrict Chinese access to some of the most Advanced Technologies um so all these things combine to make Innovation very front of mind I think for Chinese leadership and you can see this in the way they're talking about it at the moment and as Lissa said Chinese leadership is very good it's much better than other governments about being quite clear about what it's trying to do and so

if you look at this year's work report this is a state document both the number one and two priorities are both about boosting Science and Tech capabilities and same when you go into party documents which are even more authoritative on this um it's a crystal clear focus on Innovation this is something that's absolutely front of mind and I think one of the things that's interesting here is that often foreign analysts seem to think there's a fundamental tension between security and growth in China I think basically the more China cracks down on perceived security threats the

less attractive a market it becomes but I think if you look at what's being published recently that's not necessarily how Central leadership sees it I think the new line seems to be actually being able to innovate being able to have the upper hand in the industries of the future this is something that underpins both your growth and your security they're not mutually exclusive I think the thinking is that Innovation is a thing that one allows you to keep delivering growth for your people as you move away from that very export oriented World factory model but

it's also the thing that keeps you safe keeps you secure from potentially destabilizing external pressures and external influences and I think in that respect there's a lot working in China's favor and that there's lots we can go into here and hopefully we can in the Q&A but the one thing I would highlight is um China's ability to mobilize a sort of Hall of State response and what I mean by that is I think in general organizations and bodies in China tend to be a lot more responsive to Central leadership's directives than in other countries even

if they're not formly connected to the government as the party so that means when President Shu comes out and launches something like um New Quality productive forces as Lissa you mentioned this very sort of pro Innovation campaign the rest of the system really takes notice and they redirect resources to start supporting that and it's something that happens at multiple levels so we've seen recently provincial and Municipal governments rushing to put out their own Innovation Focus uh proposals you've also had private companies using that slogan to launch their own products I think siomi launched a phone

recently using the slogan New Quality productive forces and you've got your universities too within just sort of five six months of the slogan first being used it was then used in more than a thousand different academic articles which is incredibly impressive that sort of ability to mobilize it scale and obviously you're never going to have absolutely perfect alignment between all these actors but I think in general that level of responsiveness to Central priorities is a huge competitive advantage that not many other countries have so let me see will this has that changed slide for everyone

perfect um so even with all that said it is obviously easier said than done because I think there there's definitely a perception at least um where I am in Europe that China has this almost omnipotent ability to get whatever it wants done and it definitely does in some senses but I think on this Innovation question there are some interesting potential constraints that some times get overlooked and again it would be good to get into some of these in more detail in the discussion but just to give you a bit of an overview there it's obviously

the big external pressure like everyone will have seen Lots about this which is these us-led efforts to restrict ters access to some of the most advanced Tech in particular um Cutting Edge semiconductors it's an open question how successful this will be they put a lot of resources behind it um but there are still some pretty significant loopholes long term it's dependent on the US's ability to make sure key allies like Japan the Netherlands are also staying on board but either way this is obviously the big thing to be watching on the external front but I

think potentially just as interesting is some of the structures we have internally and these are a little bit I think less well reported outside of China and the first this is this is not necessarily contain it's it's very interesting it's this remarkable rise of techn s with a Science and Tech background in high level Chinese politics so if you look at the current poit Bureau which is sort of the 24 most powerful party officials in China eight out of 24 of those have a Science and Tech background um much higher than it has been in

any previous poet bureaus and even at the rungs below technocrats with that sort of background are rising through the ranks at provisional Municipal levels at like a disproportionately fast rate I think we've now got 21 out of 31 provin who have either a party secretary or governor who is a technocrat and that's doubled since 2017 and it's interesting because in a lot of cases these guys are not necessarily career politicians these are people who spent decades in research roles or managerial roles in state owned Enterprises now being almost parachuted into highlevel politics and the idea

is that to be able to fully grasp the opportunities of tech and Innovation you need people who really actually understand the tech and can pick the winners um there's also obviously an added benefit that these are people who don't pre-existing factional loyalties and unwanted political connections they're quite fresh to the system um and on the face of it obviously I think this is a big advantage and it's another proof of China's ability to sort of take a whole of State response they're not just sort of leaving this to the market but it's also not necessarily

as easy as just simply transplanting in technical knowledge for example if you're a party secretary you have a hugely wide wide ranging brief that goes Way Beyond Tech and you also operate in a hyper political environment with a quite high level of personal risk and it's not quite clear yet whether there's been the structural reform to make sure that technical experts are able to actually diffuse their technocratic expertise as well as possible throughout the system I think the next thing to flag is that also what what central leadership is trying to do is bold they're

trying to really move away and rework China's old growth model obviously to do that you have to fight against quite a lot of embedded structures and incentive systems that have built up over the past few decades and this is going to require it's going to require a mentality shift and especially when local budgets in some places are already quite stretched it is going to be hard at a local level I think to unlearn some of those unhealthier ways local officials have traditionally relied on to boost growth sort of stuff like land cells and instead encourag

them to make slightly more Tech technical in some cases riskier bets um and then the final thing I think it's worth mentioning here is just ordinary people and where they fit in all of this and I think in general it's probably fair to say that Chinese people tend to be more tolerant of new tech Solutions and Innovative but potentially sometimes more intrusive uses of data I think partly this is because there are less Avenues to constantly in in Europe you'll get very you'll get sort of data Focus protest there's potentially less avenues for that but

I think there is also in general just a bit more of a comfort in that tradeoff between personal data security and sort of convenience and I think like even if you're in a very developed City I remember actually when I was at bada you would use your you'd scan your face to get into the campus you might scan your face to uh get into your apartment building I once went to public toilet in hung Joo and you had to scan your face to get um toilet paper which are not things that you would necess neily

see at least sort of in a European or British context but there is definitely absolutely not complete acceptance of these sort of new tech Solutions at a population level and I think we've already seen a few interesting cases of public outcry causing policy change so a few years ago there was a really good investigative journalism piece that looked at working conditions for delivery drivers who are coming under huge amounts of stress because um basically they had algorithms trying to maximize their output they had faster and faster delivery targets that they were having to try and

meet to the point that you were seeing sort of big spikes and traffic accidents where these drivers were rushing to meet those targets and that is something that eventually after sort of a lot Public scrutiny the government did step in and regulate and so I think as Employers in particular start to integrate AI Solutions at pretty much every uh every stage there's a chance that we might see similar pockets of public resistance and I don't think this is never going to be something that stops innovation in its tracks entirely but I do think this sort

of people power element is another interesting thing to keep an eye on and then so I guess the next question is what comes next and it would be good to get into this in more detail in the Q&A I think a lot of this is still a very open question but the one thing that's sure is that this push for Innovation is not going anywhere I think even if the US turn around tomorrow and said oh sorry our bad no more Tech restrictions I don't think you can now unconvince Central leadership that technological self-reliance is

going to be really Central to stabil stability and security for the next few decades that said success is always going to be mixed because that there is no one such thing as techn and so I think we'll see uneven Development Across different regions sectors like for example China's lead in Green Tech is it's incredibly impressive it's going to be very very hard for anyone else to surpass but for something like Advanced semiconductors for example there's actually some really serious choke points in Supply chains external to China that could be very diff difficult for China to

innovate its way around so it's not going to be the same across the board um and then finally there's a question of what this means for all the rest of us in the rest of the world and I think professor 's already touched on this China has done a huge amount in directly engaging the world both to capitalize on where it's got that Leading Edge Advantage but also to try and mitigate some will preempt some of its vulnerabilities um but China is also such a big player that even the indirect impacts are huge and I

think we've seen this with EVS where this domestic focus on innovation has led to this huge amount of capacity that is now impacting markets in the US and Europe um and similarly for like a lot of global South countries I think one of the underappreciate consequences of the US and partners freezing Chinese firms out of advanced economies is that actually they're finding new markets uh in the global South which have been a really interesting thing to watch yeah these are some very big questions I think many which we only at the start of and so

looking forward to getting into these in a bit more detail before you you start uh you stop sharing can I just have one question yeah uh I was inted by your your sentence there Innovation is not going anywhere when I first read it I thought you meant uh China is not getting anywhere with its Innovation policy now that I hear you I think you mean something different I think you here you mean that uh Innovation is here to stay and even if the if other countries policies towards China they change like especially the exports of

uh high tech products Innovation is here to stay in the overall direction of Chinese policymaking this is what you mean by Innovation is not going anywhere yeah I think that's absolutely right if you look at it it's really sort of inst Innovation is being institutionalized at so many different levels from who your politicians are making the policy from what your kids are being taught at school from the University places available to the attraction and retention packages available for like talented scientists like it really it's it's sort of happening at every level so yeah very much

not going anywhere in the positive sense okay very interesting very interesting yeah and and very provocative because when I first looked at it I I I I understood something completely different and then as you developed your argument I I got your point of view uh so well thank you very much these were two very very insightful comments uh introductions uh to to the lines of work that you both have been uh developing so we will now have some time for some interaction with questions and answers and I will uh start by asking Professor J uh

to come back with us uh to the floor and uh Professor J the first question will be to you so I would like us to tell us more about what are the key factors from the success of China's economy that you think can be learned by other developing countries and by asking that I also realize I also know that developing countries are very different right so uh The Institute of new structural economics has been working with a number of developing countries in African uh in the African continent that I think will have a very different

reality from Brazil but I think it is very interesting to hear your perspective Professor J on what other developing countries can learn from from China's uh success story as I understand you you see it as a success story thank you okay thank you laresa uh I think I will mention two two things the first point is about infrastructure development so the Chinese government has placed a very high priority on building the digital infrastructure so such as 5G networks broadband and data centers uh all this can provide a solid foundation for the development of the digital

economy and other developing countries can learn from this by like uh increasing investment and Construction in digital infrastructure in order to promote the uh wide supplied adoption of Digital Services and the growth of digital economy and the second is like a policy support and Innovation so China has introduced a range of policies to support the development of digital economy uh for example like the uh the tax incentives the funding support and Regulatory Frameworks so while encouraging the innovation in the field of digital technology by business and the research institutions so I think uh other developing

countries can stimulate innovation in their digital econ Eon omy by implementing the similar policies and incentive measures the industrial policy and the China is actively involved in international coroporation on digital economy issues uh promote the uh construction of digital infrastructure and the exchange of digital technology through the initiative like I mentioned the SE uh the digital Sil Road initiative and the digital companies can seek uh operation with digital economy powers like like China to introduce Capital technology and experience in order to accelerate the development of their old digital economy yeah so that is my uh

very quick response thank you and as we are talking about uh International cooperation and lessons that can be learned and it's your point to the role of policy making is really uh relevant in in this case but it also means that um probably countries will need uh some technology transfer or some knowledge sharing that can help them achieve some level of uh digital or innovation development on their own so that drives me to my second question which is uh if there are cases of uh technology transfer knowledge sharing capacity building and digital Technologies from China

to other countries yeah uh China has been actively involved in international cooporation in emerging Technologies such as like uh uh artificial intelligence 5G and through the partnership with universities research institutions and companies in other countries and China has been in sharing is uh experience and expertise in these areas so there are many examples of countries involved in technology transfer uh knowledge sharing and capacity building in the digital economy between China and other uh developing countries so uh for for example in Africa there are like the talented young scientist program and the Innovative Talent Exchange program

uh which support Africa in training the young people and young talents in digital related fields and also in Latin America China has collaborated with uh countries like Argentina Brazil and Chile on the digital economy uh projects focus on the areas such as the e-commerce digital payments and the uh cyber security Cent yeah thank you and before I ask a question to Ruby uh I also would like to make a comment uh on your point um I don't think my internet connection is very good I hope I'm back yes my my internet is is not very

good am I back on stage yes can you hear me yeah yeah yeah yeah yes okay yeah sorry about that we had a lot of fires in Brazilia recently and those fires are also making our network is actually of climate change and all the difficulties we're facing um so about e-commerce uh I think this is interesting to highlight because China has really to taken e-commerce very very seriously in the past few years and it has also put e-commerce at a the central stage for its International Trade strategies and for a country like Brazil which is

already a major exporter of agricultural Goods to China I really see e-commerce as a tool that could be used towards adding value to agriculture exports that bra IL uh could um uh export to China in a easier simplified way through e-commerce so I would like to just highlight this point that could be uh um a topic for actually event because it's it's very huge in itself but the tool like e-commerce to bring uh small business uh owners from regions that are far away from the big cities in Brazil and that can eventually export their Niche

products to China to Asia to other countries through e-commerce which means they need to have like good uh infrastructure connection they should be able to uh get good internet access there people to be able to uh access the network but it really gives them um opens a new world of of opportunities uh we will probably suggest another conversation about that in the future uh so now let me ask a question to Ruby um Ruby uh I'd like to ask you uh about the this principle of high quality development it has become a key Concept in

China's recent economic planning as as we said and digital Innovation is a central piece of that so can you provide examples of concrete policies and initiatives being shaped at the central level for China to achieve these goals thank you sure yeah you're right this high quality development is sort of absolutely one of the most prominent framings I think we're seeing in Chinese politics at the moment and if you sort of go in a little bit more detail I think both sort of structurally and materially we're seeing reforms to like help that materialize so the first

thing is that there's just a fair amount of funding being made available for this and if you look at the budget for 2020 for this year in the English language press everyone always looks at the increase in defense spending actually there's a much bigger increase this year for Science and Tech funding that was up 10% so that's twice as much as the GDP growth Target of 5% um up from a 2% increase the year before and higher than the defense budget increases well so I think this is a sign of really sort of how serious

uh leadership are about putting their money where their mouth is when it comes to high quality development and when it comes to the digital and Innovation aspect of that too I think structurally as well we've also seen a couple of really interesting things so this a year or two ago I can't quite remember but um there was a new Central Science and Technology commission formed which is a basically a very powerful body that um it's interesting on two fronts its aim is to centralize and better coordinate Co coordinate Science and Tech policy with the idea

that previously resources haven't been allocated quite as efficiently as they could have been and it's interesting in two senses because I think it's centralizing a little bit of power from provinces into the center uh to try and mitigate some of the boom and bus Cycles we've traditionally seen at the provincial level but it's also taking a little bit of power from St Ministries into the party and this is a pattern we've seen quite a lot over the past decade in those areas of really really core priority for leadership and so again I just think a

sign of how important this is uh for the next sort of few years of Chinese policym very good Ruby and since you have your mic open I will take the chance to also ask you a second question which is about the the challenges for provincial governments so uh provincial governments play a key role in China in implementing National policies in general in whatever sector right so could you elaborate on how provincial leaders are aligning their strategies with the central government's vision for digital transformation and what challenges they face in balancing local priorities with national objectives

yeah it's it's a great question and I think we're we're starting to see as as we tend to do with these priority areas we're starting to see provinces mirror what's happening at the central level so I think in the past few months we've had about 13 provinces start that own provincial levels Science and Tech committee and the idea here is as well to be on a on a provincial level coordinate efforts better like they're doing centrally obviously this is also helped by as I mentioned the sort of Rise of Science and Tech technocrats in high

level positions in provinces obviously there's a the center has a quite big say in who gets appointed there and it's helpful having these people with tech technical expertise to start implementing some of these more Innovation focused reforms and I think equally as anyone who study China in detail no it's never quite as easy said and than done when when it comes to sort of getting local governments to fall into line because you obviously there's the budgetary challenges as I mentioned you can have the greatest technocrat in the world but if your budgets are stretched it

is hard you don't want to necessarily be taking risks but that is what we're going to have to do if but if you reach that sort of new stage of innovation there's also still I think pockets of local protectionism in points like a lot of what central leadership is trying to do is trying to re allocate resources more efficiently across the government across the country um but again that can be slightly easier said than done and I think we're seeing some examples where provinces are trying to out compete each other to sort of race ahead

or to attract talent and that's not necessarily going to be the most efficient way to allocate resources and then again yeah it's that it's that mentality shift right if you're an individual who's been in this system for decades you used to have a very simple metric for how well you were performing and that was how well the GDP growth was going in your area if you're moving to a model that prioritizes Innovation a little bit more that's a much harder thing to quantify and I think that's going to be a bit of a challenge as

well is what what sort of what does success look like um in this new system but I would just see quickly this been really interesting because obviously China is incredibly diverse and this happens not just at the provincial level also the municipal the city level as well and I think her and Anu province is a really interesting example of uh a city that's taken a really entrepreneurial approach to this and is really in the past decade or so emerged as this really prominent Science and Tech Hub in pickling anys also in Quantum and they've done

all sorts of innovative things to sort of taking stakes in private companies having supply chain chap system all of which has allowed them to sort of race ahead and there's definitely pre-existing advantages H heal had that other parts of the country W but I think it's also just a really interesting case study of how there not going to be one siiz fits all model and there's quite a lot of flexibility within the Chinese system to allow provinces to allow individual cities even to try and adapt this to their own situations yes um and very interesting

to think about like concrete cases I I also heard an an argument as as you were saying it really depends on the very specific situation right so as as always uh it comes down to the details right so it depends on your budget it depends on sometimes the personal experience of the P the people in charge right if they are um also in terms of Personality people I Frozen again you're back you're back can you hear me am I back you're back thank you so some uh depending on the profile like some will look more

into stability and Tech is a very highrisk type of investment so it's it's very hard to consider all these variables when when analyzing What policies will will have more SU ESS and then I would just briefly like to drive the conversation into the impacts of uh this uh strategy to China's relations with the world so maybe just the last question to Professor J uh she mentioned the digital Silk Road and the belon road initiative so can you just tell us uh in in one minute what's the relation between the digital Silk Road and the framework

of the belon road initiative yeah okay S I will give a very quick response I think the digital silk Ro is a key component of the B and Ro initiative and aimed and at strengthening the global digital connectivity by promoting the digital infrastructure construction and the digital economy coroporation so this uh incentive or the digital SE grow focus on advancing the development of digital economy such as e-commerce digital technology corporation so it extends beyond the traditional physical connection like rad Railway and PS and collaboration in the digital realm so including the application of Technology like

5G big data and artificial uh intelligence to Foster digital economic growth and breach the digital divide yeah excellent Professor J any final words that you would like to address to your audience yeah I I just want to yeah I'm so conf confidence about the digital uh development uh the future digital development in China and especially I think every country will firstly identify their own competitive advantage in the field of digital economy and I do agree with you that you mentioned for example in Brazil uh uh in order to uh no rather than exporting directly the

agriculture uh to the global market it is very important to put more value added to like for example agricultureal transformation so we need to identify the comparative advantage of each country and use the digital technology as a very effective tool to put more value added value to to the country yeah so I think the digital technology will be a very effective tool to enhance the connectivity uh between countries thank you thank you thank you Ruby Osman would you like to make any final comments maybe especially on this potential impact on China's Foreign Relations I would

just sort of echo what Professor you saying which is China is such a significant actor and there is such a a commitment at so many levels to innovate that I think this is going to have massive impacts around the world there's going to be positives there's going to be negatives but I think every country can benefit Itself by sort of keeping ahead of the curve because a lot of those decisions being taken in Beijing are going to be far Capitals in markets and Supply chains around the world thank you thank you Ruby uh well I

couldn't be happier with with the results of this discussion and so much uh uh knowledge sharing I I learned so much from from these two great panelists and uh two women so we have a a panel about technology and Innovation uh that is led by women and I'm also very happy about that a full female panel uh on behalf of the Brazilian Center for international Affairs i' would like to thank everyone for joining us on this discussion I apologize for the poor quality of my internet but everyone in Brazil is following the news about the

fires you all know what's happening uh very unfortunately the national forest of Brazilia was on fire a few days ago and uh uh all of this has made our network uh worse so I really thank you for your patience and for being here with us I hope we will uh Deep dive on these discussions in a few other occasions uh as our new uh program uh for the China analysis group uh develops thank you all thank you have a great day thank you everyone