Club Comments: China continues to make new breakthroughs in the fields of new energy, artificial intelligence, and high-tech products. In this regard, a small number of Western countries, led by the United States, began to hype up China's "overcapacity". In April, during the visit of the US Secretary of the Treasury, Secretary of State and other senior officials to China, the Chinese side repeatedly asked the US side not to interfere with normal international economic and trade rules on the grounds of "overcapacity".
What do the countries of the Global South think about the dispute between China and the United States? Busani Ngcaweni, president of the National Academy of Administration in South Africa, wrote a special article for the Beijing Dialogue, noting that April 2024 is of great significance for the "fourth industrial revolution" internationally.
This past April was marked by a significant time for the Fourth Industrial Revolution. A number of events occurred during this period, laying the foundation for the global competition for the dominance of artificial intelligence and new energy technology.
Global competition over technology has been going on for decades, but it has become noticeably more intense after former U.S. President Donald Trump banned some Chinese tech companies from doing business in the United States. Meanwhile, in places like Australia and the European Union, tech companies such as Meta, Alphabet (Google) and Microsoft have been charged or fined for monopolies, threats to sovereignty or major data breaches. In Africa, platforms such as WhatsApp (a Meta company) have come under investigation from competition authorities and have lost a number of antitrust cases.
However, over the course of April 2024, the conflict has spilled over into an open war beyond the confines of government boardrooms and corporate hegemony. Let's take a look at some of the major events that took place in April:
During April, several U.S. government officials denounced China's EV "overcapacity" and even suggested that China was dumping EVs. Through these statements and counter-arguments, it is clear that in less than a decade, China has gone from being the "world's manufacturing factory" that relies on fossil fuels and has been accused of "polluting the planet" to becoming a global leader in new energy technologies.
China's electric vehicles are already internationally competitive in terms of design, efficiency and price. At the Beijing Auto Show in April, the theme was "New Era, New Automobiles", and many European and American automakers who participated in the auto show almost threw in the towel. In addition to acknowledging the unparalleled progress made by Chinese automakers, some Western executives have noted that Western companies have lost some of their best designers due to their flexibility, abundant resources and remarkable progress in R&D. For example, one executive mentioned that the existence of battery swapping stations in China means that people don't have to worry about charging time, and the rapid rollout of charging facilities has also reduced other consumer concerns. The discussion reminded me of the concerns of EV owners in Rome, Italy, who suffer from a lack of charging infrastructure, exacerbated by high electricity bills.
On April 30, at the Beijing Auto Show, the audience visited the CATL exhibition area.
On April 30, at the Beijing Auto Show, Huawei's intelligent charging network in the exhibition area.
On April 30, at the Beijing Auto Show, visitors visited the demonstration of electric vehicle swap stations in the NIO exhibition area.
China's response to the alleged "dumping" accusations is simple: we have moved towards new quality productivity and have achieved major breakthroughs in productivity using artificial intelligence; Considering the size of China's EV market, it makes perfect sense that China's EVs are price-competitive. In April, Tesla not only announced price cuts, but also refunds to customers who had purchased the brand since January 24, escalating the technology and price war to incredible proportions.
According to Tesla's official website in China, the price of the new Model 3 version has been reduced to 231,900 yuan, and the price of the new version of the Model 3 long range has been reduced to 271,900 yuan. (Source: Tesla China official website)
Also in April, the United States enacted an unprecedented comprehensive national security law that barred TikTok, a Chinese-owned short-form video social media company, from doing business in the United States unless ByteDance divested. It is in this same law that the United States banned TikTok while supplying weapons and money to other countries that are at war. A U.S. lawmaker proudly declared that by passing the law, they were sending ammunition to war zones, not soldiers.
Like the ban on other Chinese tech companies like Huawei, this is just one battle in a broader and bitter war for leadership of the Fourth Industrial Revolution. If winning this war requires adopting "socialist" approaches such as nationalization, the old capitalist countries will revise the definition of capitalism to protect their industries, big data, influence, and markets.
Just as the TikTok controversy was raging, "EvolvingAI" broke the news that China had made a breakthrough in artificial intelligence, launching a large language model called SenseNova 5.0, whose performance seemed to overshadow the dominant GPT-4 Turbo. SenseNova 5.0 is said to be more accurate and efficient because it leverages the largest machine learning database resources, complemented by advanced coding capabilities. Of course, there are still some questions about the platform and the use of language that need to be examined and clarified; The linguistic factor is crucial to the global market, as the majority of users with large language models speak English. Large language models such as ChatGPT, Bard (Google/Gemini), and Perplexity are expected to respond to this challenge and even update their platforms in the coming weeks and months.
On April 23, SenseTime held a technical exchange day to upgrade the "SenseNova 5.0" large model system, and its comprehensive capabilities are fully benchmarked against GPT-4 Turbo. (Source: Observer.com)
During the U.S. Secretary of State's visit to China in April, media reported that the two countries agreed to explore cooperation in the field of artificial intelligence. One critic called it a revolutionary development in the Fourth Industrial Revolution race. One view is that the two countries should cooperate rather than compete in the field of AI, which will benefit all of humanity because they can complement each other with their respective capabilities and investments. Hopefully, we will live long enough to witness this vision come to fruition.
As an African citizen, the most impressive AI-related news in April was the official launch of the Critical Minerals Panel on Energy Transition, led by UN Secretary-General António Guterres. In my opinion, this UN initiative is no less revolutionary than the era of artificial intelligence itself. Let me explain the relevance and implications for the continent's economy.
First, the scientific and technological advances mentioned above depend on the supply of critical minerals. Electric vehicle batteries need lithium to store energy, cobalt to extend battery life, nickel to increase storage capacity and efficiency, and graphite and manganese to improve performance. Africa has the largest reserves of these minerals, with Canada and China having some. Solar energy production plays an important role in the energy transition, relying on materials such as silicon, silver, copper (Zambia's gold), gallium, indium and tellurium. Without Africa's critical minerals, the world's transition to solar energy would have slowed significantly. Africa's contribution is therefore crucial to achieving a just energy transition and winning the race for the Fourth Industrial Revolution.
There are numerous reports of exploitation of communities and countries where minerals are located in central and western Africa. In countries such as the Democratic Republic of the Congo, some have likened the ghost of King Leopold to people and companies engaged in the mining of rare minerals (Beijing Dialogue: Leopold II was King of Belgium and the founder and sole owner of the Congo Free State, during which time he ordered the murder of millions to 15 million Congolese people in order to maximize economic gain). This exploitation devastates local societies, economies and politics as locals are used as slave labourers and the environment is destroyed without bringing any substantial benefits to the local area, such as taxation and mineral processing.
The initiative of the United Nations is therefore very welcome. For many years, I have dreamed of moving forward with the Kimberley Process 2.0. The Kimberley Process is South Africa's contribution to making the global diamond trade more humane, and the United Nations has played an important role in it. Through the Kimberley Process, the world has come together to eliminate the "blood diamonds" that have fuelled conflict in Africa but have glittered in the capitals of the Global North. This process has introduced accountability systems that have enabled diamonds sold on the open market to be traced back to their origins, significantly reduced conflict and plundering of Africa's resources, and helped end wars in countries such as Liberia and Sierra Leone. The process takes its name from the South African town of Kimberley, where diamonds were first mined in large quantities.
Source: Kimberley Process (KP) official website
Recently, Botswana renegotiated a joint venture agreement with diamond monopoly De Beers, successfully forcing the company to add value to its diamonds before exporting them to Europe for further processing.
This new initiative by the United Nations should be welcomed, not only because it fulfills my dream of implementing a "Kimberley Process" for all rare earths and critical minerals, thereby significantly reducing conflict; More importantly, Africa can use the Kimberley Process 2.0 to transform its economy. African countries should turn this natural comparative advantage into a competitive advantage by setting stringent mining conditions. These conditions should include mineral processing, investment in infrastructure, transfer of skills and technology, and environmental protection, which are essential conditions for industrialization. We cannot extract products that help decarbonize the world while leaving long-term environmental, social, political, and economic scars in Africa.
The potential for mutually beneficial action is huge, and partners like China can take the lead in the Kimberley Process 2.0 to work with Africa to industrialize while ensuring a just energy transition for all.