IVA's President: Some thoughts on the Self-confident China

Dear Friends of IVA,

When the world feels overwhelming, I find valuable insights in history – most recently from the Roman emperor Marcus Aurelius and his “Meditations.”  Can Stoicism help us understand what is happening, why it is happening, and guide us forward? Perhaps.

As the Stoic philosophers like Aurelius believed, some things are within our control and some are not. In today’s rapidly changing world, we can do very little about the pace of China’s technological development or political shifts in the United States. But Sweden and Europe can very much control their own destiny. The choices we make today determine our future prosperity. Accepting this truth is not about giving up or being passive, but about seeing reality as it is and acting pragmatically. Or as Deng Xiaoping put it in the 1970s when he launched the economic reforms that have since changed history and the world: “I don’t care if the cat is white or black, as long as it catches mice.”

I recently spent just over a week in China after an invitation to speak at a conference in Hong Kong. Since my last visit was some years back, this trip was absolutely essential. Chinese policymakers have, more than any others, understood the incredibly important role of technology in a country’s global power. One example of this is that the Chinese government sets aside one afternoon a month for researchers and other experts to brief officials on important developments at home and abroad in science and technology. This takes place at the national, regional, and local levels. As a former Chinese minister told me: “If a country wants to move forward, it must carefully study other countries.” That is exactly what China has done over the past 40 years.

Briefing policymakers is not about prestige or showing off results, but about testing the relevance of the research and the researcher’s ability to put it in context. The ultimate test is to make the research understandable and meaningful and to convey something useful to decision-makers who have neither the detailed knowledge nor the time to delve deeply into the topic themselves. If you can do that, you have succeeded. Incidentally, this is something I consider to be one of IVA’s most important tasks.

China today is a self-confident China. I sense a feeling of restoration and a desire to demonstrate success – both economically and technologically, but also in terms of ideas and systems. I perceive the tone as less driven by a cult of personality around Xi Jinping than before, and more confident that China’s system can compete with and even surpass the western world. One senses that China is standing firm and growing stronger while the West is stumbling and tripping over its own feet.

The pace of development is, of course, striking. Change is happening rapidly – and it is taken for granted that these changes must happen quickly. This applies technologically, commercially, and economically.

I was also impressed by the vibrancy of the discussion, the plans, and the activity in China regarding the significance of AI for education. In line with China’s development model – which encourages municipalities, provinces, and other actors to test new tools and approaches – some universities and institutions are leading the way in renewing education. One example is the top university and Xi Jinping’s alma mater, Tsinghua University, which is supporting multidisciplinarity and interdisciplinarity by expanding its engineering programs in a new “Engineering College” on its Shenzhen campus. Lastly, it was evident that Hong Kong, after a few challenging years, is in the process of reinventing itself as the world’s third most important financial center (after New York and London), particularly when it comes to IPOs.

Together, Hong Kong, Shenzhen and Guangzhou form the engine of the Greater Bay Area, one of the world’s most dynamic growth regions, where cutting-edge finance and technological innovation converge.

The transition from research and innovation to production is much faster in China. After decades of focusing on manufacturing, the country is now increasingly investing in advanced research with a clear link to industrial and societal needs. The government is taking a long-term approach, with ambitions, goals, and investments that extend far into the future. The business sector, on the other hand, seems to take a somewhat more short-term approach in a system where it is under pressure to respond quickly to a dynamic market but also to signals from the government. Is this the opposite in Sweden?

But let’s not oversimplify the picture. China faces significant challenges – with an aging population, faltering domestic private consumption, problematic international relations, and major economic imbalances. It is also an authoritarian regime (as classified by the Economist Intelligence Unit) with clear restrictions on political freedom. The optimism and self-confidence I encountered among researchers, tech companies, and the state apparatus do not apply to everyone. Many younger researchers and students face brutal competition, pressure to deliver, and a tough job market. The latter also partly explains the dramatic decline in birth rates, particularly in major cities, and an aging population—a situation that risks China growing old before it grows rich. How China handles all of this will be crucial for its continued development.

China views Europe as a fundamentally reliable partner. At the same time, interest in and understanding of Europe’s challenges are limited. In China, the view is that Europe has only itself to blame, particularly when it comes to problems related to energy supply and a lack of strategic initiative. This perspective may seem oversimplified, but it says something about how we are perceived from the outside.

So what does this mean for us? Sweden and Europe are fundamentally strong. Not least in terms of democracy, sustainability (social and environmental), research, education, and advanced industry. But we need to reflect more deeply on how we can strengthen our ability to act more quickly and strategically.

Travel provides fresh insights and perspectives. I return to Marcus Aurelius, who wrote:” Observe the stars in their courses as if you were running with them and constantly consider the changes of the elements into one another; for such thoughts purge away the filth of life on earth”.