4

The Competitive Challenge Posed by China

The competitive challenge that China poses to the United States is unprecedented. Through its large investments in research and development (R&D) funding and personnel and its leaders’ attention to science and technology, China has indicated that its ambitions are not just to catch up with the United States in science and technology but to surpass it. This chapter highlights aspects of the competition between the United States and China and the implications of China’s actions for U.S. interests.

Many countries support public- and private-sector R&D to strengthen their economies and national security. The United States is still the largest single funder of R&D globally, but it now accounts for only about a quarter of the global total (Figure 4-1) (NSB, 2020). International collaboration, digital communications, and the flow of students and STEM (science, technology, engineering, and mathematics) professionals across borders augment countries’ R&D expenditures by ensuring the rapid dissemination of new ideas and information. The United Nations’ Sustainable Development Goal 9.5 calls on nations to “enhance scientific research, upgrade the technological capabilities of industrial sectors in all countries, in particular developing countries, including, by 2030, encouraging innovation and substantially increasing the number of research and development workers per 1 million people and public and private research and development spending.” Scientific research and technology development are worldwide endeavors that have widespread benefits even as they improve the economic conditions and military strength of particular countries.

In this global science and technology enterprise, China has recently assumed a particularly prominent position. Funding for R&D in China has risen 30-fold since 1990 and, given a continuation of current trends, will surpass U.S. funding during the early part of this decade (Committee on New Models for U.S. Science and Technology Policy, 2020). Chinese scientists now publish more scientific articles than do U.S. scientists, although papers from U.S. scientists are

currently more highly cited overall (NSB, 2020b).¹ Chinese universities have been producing more STEM Ph.D.’s than U.S. universities for more than a decade, and by 2025 are expected to be producing nearly twice as many (Zwetsloot et al., 2021). Compared with their U.S. counterparts, China’s leaders devote much more attention to science and technology, and China’s growing strengths in science and technology are a source of national pride. For all these reasons, China is an excellent example of the new kinds of competitive challenges facing the United States.

This chapter examines the steps China has taken and is planning to take to become a global leader in science and technology. Using synthetic biology and the other cases studied as examples (see Chapter 2), it looks not just at R&D funding but also at China’s efforts to acquire technologies developed elsewhere, attract top talent, and establish its supremacy in both targeted areas of science and technology and in the overall strength of its science and technology system. Discussed as well are the large numbers of Chinese undergraduate and graduate students and postdoctoral fellows who come to the United States to study science and engineering and do scientific research, many of whom remain in the United States to work.

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¹ The National Science Board (NSB) notes that between 2000 and 2020, the index of highly cited articles (a country’s share of the top most-cited science and engineering (S&E) publications divided by a country’s share of all S&E publications) for the United States remained stable at 1.8, while China’s index increased from 0.4 to 1.2. An index over 1.0 indicates that a country contributes a larger share of top-cited articles, compared with its share of overall publication output.

FEATURES OF THE COMPETITION BETWEEN THE UNITED STATES AND CHINA

The competition between the United States and China for leadership in technologies strategically important to national and economic security differs in many respects from the competition between the United States and Soviet Union during the Cold War. Unlike the Soviet Union, China has learned how to leverage domestic and foreign demand to enhance economic growth, and its economy has been expanding rapidly. China and the United States are much more intertwined economically than were the United States and the Soviet Union, with the economies of each relying heavily on exports and services provided by the other. Many Chinese students attend U.S. universities, and many scientists and engineers born and raised in China work in the U.S. science and technology enterprise, which was not the case with Soviet scientists during the Cold War. Each country plays outsized and interdependent roles in the major challenges facing the world today, such as climate change and global pandemics. Each country is part of broader economic and security networks that both increase capabilities and constrain actions.

The current U.S. competition with China is also different from the economic competition between the United States and Japan in the 1980s. Japan was competing in some of the economic sectors in which the United States had long held dominance, such as microelectronics, automobiles, and machine tools; however, Japan was a geopolitical ally with similar innovation, economic, and governance systems. Japan’s innovation system was also smaller, with Japanese graduate students and postdoctoral fellows having a small presence in U.S. universities compared with the much larger numbers of Chinese students in U.S. universities today. While the Japanese government played an active role in Japan’s competitive position, including subsidizing its domestic industries and seeking to acquire technology from abroad, it adhered to international norms on economic, legal, and trade matters.

Although the United States and China are the two largest funders of R&D in the world today, aspects of the two countries’ approaches to supporting science and technology differ substantially. First, as discussed further below, in its effort to reduce its reliance on foreign technologies and assume leadership in the technologies of the future, China engages in much more integrated planning and strategic action relative to the United States. The Made in China 2025 technical area roadmap, for example, calls for China to become a leader in ten industrial sectors (Alves Dias et al., 2019):

• next-generation information technology,
• high-end numerical control machinery and robotics,
• aerospace and aviation equipment,
• maritime engineering equipment and high-tech maritime vessel manufacturing,

• advanced rail equipment,
• energy-saving vehicles and new-energy vehicles,
• electrical equipment,
• agricultural machinery and equipment,
• new materials, and
• biopharmaceutical and high-performance medical devices.

Besides investing heavily in R&D to develop commercially and militarily valuable technologies, China has been seeking to acquire technologies developed elsewhere (Brown and Singh, 2018). Chinese companies have purchased technology companies in the United States and elsewhere to gain access to cutting-edge research. The Chinese government has subsidized domestic industries, has blocked foreign investment in Chinese companies to give those companies an advantage in foreign competition, and engages in industrial espionage and cybertheft to acquire technology. When foreign investment in Chinese companies is allowed, technology transfer is often a condition of building, owning, or operating facilities in China. China has been acquiring more power in the United Nations and other international bodies, including standards-setting bodies. It has an integrated and top-down set of strategies, and it takes a whole-of-government and global approach to implementing those strategies, including planning for raw materials and supply chain issues while a technology is only in the research phase.

Another difference between the United States and China is China’s explicit advocacy of what it calls “military–civil fusion,” which is aimed at eliminating barriers between its commercial and military sectors (Kania and Laska, 2021). Although the implementation of this strategy faces significant obstacles, its goal is to integrate economic development and military modernization by having the commercial and defense enterprises share innovations, resources, and talent. China’s commitment to the concept of fusion signals its desire to achieve integrated commercial and military leadership. The United States does not have an official policy to promote interactions between the civilian and defense sectors, although many companies work in both sectors, companies in one sector interact with companies working in the other, and many university research labs conduct defense-related research funded by the government. In addition to federal laboratories associated with the Department of Defense, the United States also maintains 17 national laboratories housed in the Department of Energy and staffed by civilian contractors, and many of these laboratories play a significant role in support of the defense mission (DOE, 2020).

The Chinese government has been emphasizing the ways in which it is distinct from the United States and other democracies. At the time China entered the World Trade Organization, many expected it to become a more open and market-oriented country (Mavroidis and Sapir, 2021); instead, it has taken a turn toward authoritarianism and military assertiveness (Liff and Ikenberry, 2014). While the United States and other nations are committed to individual freedoms

and to a diversity of identities, China is committed to the belief that all its citizens should share a fundamental identity and allegiance to the state. It has sought to draw other countries, particularly those with authoritarian leaders, into closer ties by emphasizing its success in lifting hundreds of millions of people out of poverty. China has sought to portray democratic countries as failing experiments in governance while touting and advancing its own achievements and worldview.

As noted previously, a distinguishing feature of China’s approach to gaining market leadership over the West has been its use of detailed strategies outlining the specific technology areas in which it seeks to attain leadership; outlined as well are the steps it is taking to that end. This approach is quite different from that of the United States, which has historically based its actions on broad precepts, such as the expansion of democratic principles and expansion of free trade. U.S. strategies have historically not been tied to specific technology areas, with the exception of narrow areas in which technologies have clear military or national security applications, as is the case with, for example, nuclear weapons technologies.

China’s advantages in research, development, and innovation do have limitations. China’s government, economy, and society have many weaknesses, including inefficient state-owned enterprises; a lopsided demographic structure, with 120 boys born for every 100 girls; rising levels of debt; strong neighboring countries; a dependence on imported goods; and a rigid ideology that limits experimentation (Hass, 2020). China’s reliance on other countries for raw materials, markets, and advanced training in science and technology limits its ability to act unilaterally. The U.S. science and technology ecosystem is still stronger and more agile than China’s, in part because of diversified federal support for R&D, the strength of U.S. capital markets, and human resources from domestic and international sources.

SYNTHETIC BIOLOGY IN CHINA²

A closer look at China’s initiatives in one of the four case studies examined in Chapter 2—synthetic biology—provides a specific example of the steps that country is taking to attain leadership in science and technology. A high-level Communist Party and Chinese Academy of Sciences official voiced China’s intentions, stating, “As Europe won in the 19th century using industry, and the United States won in the 20th century using information technology, so China will win in the 21st using biology” (Carlson, 2019).

The United States is the global leader in synthetic biology, largely as a result of massive investments in biology and life sciences research and especially since the doubling of funding for the National Institutes of Health (NIH) in the

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² This section is based in part on the presentations at a workshop on synthetic biology held by the committee on May 13, 2021. An agenda for the workshop and speaker biographies are available at https://www.nationalacademies.org/event/05-13-2021/protecting-critical-technologies-for-nationalsecurity-in-an-era-of-openness-and-competition-meeting-3-workshop-on-synthetic-biology.

early to mid-1990s (NASEM, 2020b). As discussed in Chapter 2, the significance of global leadership in this area goes beyond the development of biologic materials and products: synthetic biology is best viewed as a broad “production platform” with the potential to disrupt a wide range of technology areas (El Karoui et al., 2019).

Synthetic biology–related research in China started as early as the 1960s, when Chinese scientists produced synthetic insulin (Kung et al., 1965). Despite some early ventures, however, serious interest in synthetic biology did not begin in China until 2007, when a Chinese team became world champions at an International Genetically Engineered Machines (iGEM) competition with their project “Towards Self-Differentiated Bacterial Assembly Line” (Moshasha, 2016). A year later, China held the Xiangshan Conference on Synthetic Biology, during which Chinese biologists emphasized the massive contributions that synthetic biology could make to the future bioeconomy and called for greater government support for the field.

Following this conference, the Key Laboratory of Synthetic Biology was launched in 2008, marking the Chinese government’s first official foray into synthetic biology. Established by the Chinese Academy of Sciences, the laboratory sought to design functional biological parts that could produce biomaterials and bioenergy through the modification and synthesis of biological systems. Since then, synthetic biology has advanced at a rapid pace in China, with an early focus both on bioremediation to improve the lives of Chinese citizens and on the growth of the Chinese bioeconomy. By 2013, when the U.S. National Academy of Engineering and National Research Council held a series of symposia on synthetic biology, China was already contributing about 10 percent of papers on synthetic biology published globally each year (NAE and NRC, 2013).

Today, numerous Chinese organizations, largely government-related—including the Chinese Academy of Sciences, the Chinese Academy of Engineering, the national and local offices of the China Academy of Machinery Science and Technology, and medical universities—support research in synthetic biology. Funding for this research comes from many sources, with estimates totaling roughly U.S. $100 billion per year (NAE and NRC, 2013).

In 2009, the Chinese Academy of Sciences developed a strategic roadmap, “Innovation 2050: Technology Renovation and the Future of China,” outlining desired achievements in technology, industrial applications, medicine, and agriculture within 5, 10, and 20 years (Pei et al., 2011). Part of this roadmap focused on synthetic biology, including “goals related to the availability of comprehensive databases for synthetic parts, a timeframe for commercial application of engineered parts, and a timeframe for clinical application of devices and systems” (NAE and NRC, 2013, p. 18). China’s 13th Five-Year Plan established a goal for biotechnology to contribute 4 percent of the country’s gross domestic product (GDP) (or roughly U.S. $600 billion) by 2020 (People’s Daily, 2017).

Biotechnology is also becoming increasingly important in Chinese military doctrine, with the People’s Liberation Army designating biology as a

separate warfighting domain (Cunningham and Geis, 2020). Potential applications to the Chinese military include biomaterials, human enhancement, and offensive capabilities that may include ethnically targeted bioweapons (Cunningham and Geis, 2020). Thus far, the United States has not focused on the potential for biotechnology to transform offensive military technology, thereby creating an opportunity for China to gain a military advantage.

The Chinese government is seeking access to foreign capabilities in synthetic biology to accelerate the development of its domestic industries, in part through the acquisition of foreign companies and technologies (FBI, 2019; see also Brown and Singh, 2018; Sganga, 2022). It also is developing resources that it is carefully protecting from other countries. For example, China has collected the world’s largest human genetic database and has prohibited its export to preserve its intrinsic economic and security value (Cunningham and Geis, 2020). In general, as noted earlier, China wants to ensure that it does not just catch up to the United States technologically but surpasses it to dominate the technical field (Huggett, 2019).

In the past decade, the Chinese government has supported the development of numerous academic centers for synthetic biology. In 2017, the Chinese Academy of Sciences launched the Institute of Synthetic Biology, the country’s first institute in this field. Guided by the principle “build life for understanding it, build life for applications,” the institute was designed to integrate research in biotechnology and information technology to further understanding and applications of synthetic biology. Today, the institute is home to the world’s largest cutting-edge multidisciplinary team in synthetic biology, composed primarily of young “overseas returnees” specializing in the field.

In 2018, the Shenzhen Institute of Advanced Integration Technology (SIAT) approved the combined development of the Shenzhen Institute of Synthetic Biology and the Institute of Synthetic Biology at SIAT. With a 750 million RMB (about U.S. $110 million) investment from the Shenzhen Municipal Government, SIAT quickly built one of the world’s largest scientific and technological facilities for research in synthetic biology. This facility houses numerous synthetic biology research centers, including the Center for Quantitative Synthetic Biology, the Center for Synthetic Genomics, the Center for Synthetic Biochemistry, the Center for Synthetic Microbiome, the Center for Genome Engineering and Therapy, the Center for Synthetic Immunology, the Materials Synthetic Biology Center, and the Center for Cell and Gene Circuit Design. The main building, completed in January 2021, serves as an advanced platform for the design and fabrication of biological systems (Shenzhen Institute of Synthetic Biology, n.d.).

In 2019, backed by billionaire Li Ka Shing’s HK $500 million (U.S. $70–80 million) donation, the Hong Kong University of Science and Technology (HKUST) launched the Li Ka Shing Institute for Synthetic Biology. The institute, which emphasizes originality and the application of foundational knowledge, aims to integrate genetic engineering with artificial intelligence (AI) and relevant analysis methodologies to bring about discoveries that lead to innovative products

(Cumbers, 2019). HKUST expects to invest about U.S. $1 billion in the institute during this decade to make Hong Kong a global hub for synthetic biology. This investment aligns with the Chinese government’s strategy to go from serving as the world’s factory to developing advanced-value products, thereby advancing domestic resilience, improving and stabilizing industrial supply chains, improving advanced manufacturing and promoting scientific research, coupling basic life sciences research with information technology, ensuring harmony between humans and nature, and strengthening the country’s public health system (Tsang and Poon, 2021). The United States has synthetic biology centers housed at the Massachusetts Institute of Technology; the University of California, Berkeley; Northwestern University; and elsewhere. Nonetheless, the gift from the Li Ka Shing Foundation to HKUST represents the largest single donation for synthetic biology research globally, reinforcing China’s belief in the importance of the field to its future global economy.

In the past decade, China has also made significant investments in bio databanks and biofoundries. Established in 2011, the China National GeneBank (CNGB) was China’s first national-level gene storage bank, approved and funded by the Chinese government. The Center for CNGB, including a biorepository, a bioinformatics data center, and a living biobank, opened in Shenzhen in 2016. Combining these repositories, the China National GeneBank DataBase (CNGBdb) was designed to provide a unified platform for biological big data sharing and application services to the research community.³ Using big data and cloud computing technologies, CNGBdb has integrated large amounts of internal and external molecular information, and has correlated living sources, biological samples, and bioinformatics data to enable biological data to be traced throughout the life cycle. In collaboration with Australia’s Macquarie University and Harvard University, CNGB also has a synthetic biology platform focused on metabolic engineering and the development of high-density DNA storage technology (GenomeWeb, 2018). Today, China has accumulated the largest genomic holdings of any country in the world (Ratnam, 2021).

Founded in 2019, the National Genomics Data Center (NGDC), part of the China National Center for Bioinformation (CNCB), was designed to provide open access to a suite of data resources and services generated from large-scale sequencing studies on precision medicine and biodiversity. Since the beginning of the COVID-19 pandemic, for example, the CNCB-NGDC has focused in particular on building a SARS-CoV-2 information resource through genomic data collection, curation, and deep mining with extensive daily updates. This database, named the 2019 Novel Coronavirus Resource, contains an open-access, comprehensive collection of genome sequences and clinical information for all publicly available SARS-CoV-2 isolates. Other new databases that have emerged from the NGDC include the Aging Atlas, an integrative database designed to support research on aging; Brainbase, a curated knowledge base for brain

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³ China National GeneBank DataBase (https://doi.org/10.25504/FAIRsharing.9btRvC [accessed June 10, 2022]).

diseases; and the Chloroplast Genome Information Resource, a curated resource of chloroplast genome information. Simultaneously, a number of resources have been updated and improved, including BioProject, BioSample, and several biodiversity and plant resources. Of particular note, BIG Search, a scalable, one-stop, cross-database search engine, has been updated to provide easy access to a large quantity of internal and external biological resources (CNCB-NDGC Members and Partners, 2020).

In 2020, Shenzhen Science City announced that the Advanced Biofoundry Shenzhen will be one of the key projects for priority launch. This biofoundry will have three platforms: a design–learn platform, a synthetic testing platform, and a user testing platform (Shenzhen Institute of Advanced Technology, 2020). Ultimately, the Shenzhen biofoundry is intended to expedite the “design–build–test–learn” cycle economically to realize the rational design and synthesis of artificial living systems.

With these and other recent developments, China has created and is pursuing a coherent national plan for challenging the U.S. leadership in the synthetic biology field. Currently, the United States and China remain interdependent and closely intertwined in the field: the United States relies on China for manufacturing, services, and talented students who come to study and work at U.S. universities, while China depends on external basic research to support a bioeconomy geared toward commercialization of innovations created elsewhere. Decoupling the activities of the two countries would be difficult, but China is clearly striving for dominance in synthetic biology. If the United States is to remain competitive in synthetic biology, it will need to remain vigilant about China’s activities in the field and develop a comprehensive strategy for responding to the competitive challenge posed by those activities.

CHINA’S ACTIVITIES IN MICROELECTRONICS, ARTIFICIAL INTELLIGENCE, AND QUANTUM COMPUTING

Less in-depth examinations of the other three case studies considered in Chapter 2 similarly reveal the efforts China is making to gain leadership in microelectronics, AI, and quantum computing. In contrast to China’s directed and coordinated planning to achieve positions of technological leadership, the United States generally has not developed a strategic policy for advancing innovation and commercialization of these technologies.

Microelectronics

Although China is not yet among the world’s leaders in the design or production of leading-edge microelectronics, it is narrowing the gap with the leaders (Graham et al., 2021). China’s semiconductor manufacturing capacity has already surpassed that of the United States, and China is projected to become the world’s largest semiconductor manufacturer by 2030. It also is the largest single

consumer of semiconductors, creating powerful incentives for it to advance its domestic microelectronics industry.⁴

According to a recent report by the U.S. Trade Representatives, “China’s strategy calls for creating a closed-loop semiconductor manufacturing ecosystem with self-sufficiency at every stage of the manufacturing process—from IC [integrated circuit] design and manufacturing to packaging and testing, and the production of related materials and equipment” (USTR, 2018, p. 113). The national and provincial governments are supporting “national champion” firms under a National Integrated Circuit Investment Fund to acquire critical technologies and build advanced fabrication facilities (Kim and VerWey, 2019). The Made in China 2025 technical area roadmap calls for the main segments of the industry to reach advanced international levels by 2030. At that point, domestic producers should be providing 80 percent of domestic consumption of integrated circuits.

The Chinese government directly supports the industry through favorable loans, direct grants, reduced utility rates, tax breaks, and free or discounted land (SIA, 2021). These incentives have spurred the creation of thousands of new semiconductor companies, and more than 100 new fabrication facility projects have been announced since 2014. China is also supporting other parts of the microelectronic supply chain in an effort to achieve indigenous capabilities. As the Semiconductor Industry Association has stated, “If left unchecked, state-owned Chinese firms shielded from market forces, or [with] access to illicitly acquired IP [intellectual property], could pose significant challenges to the health of the U.S. semiconductor industrial base” (SIA, 2021, p. 6).

Artificial Intelligence

The New Generation Artificial Intelligence Development Plan (AIDP) released by the Chinese government in 2017 called on China to “plan, grasp the direction, seize the opportunity, lead the world in new trends in the development of AI, serve economic and social development, and support national security, promoting the overall elevation of the nation’s competitiveness” in AI (China State Council, 2017). By 2025, according to the plan, “China will achieve major breakthroughs in basic theories for AI, such that some technologies and applications achieve a world-leading level and AI becomes the main driving force for China’s industrial upgrading and economic transformation” (China State Council, 2017). Under the plan, China will become the world’s innovation center for AI by 2030.

With active support from the highest levels of government, China is pursuing a variety of AI applications in both the military and commercial sectors (Allen, 2019). It has established two major new research organizations on AI and

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⁴ Although China assembles more than one-third of the world’s electronic devices, its share of electronic device end users is nearly as large as that of the United States (SIA, 2021).

unmanned systems under the National University of Defense Technology, and private-sector companies are developing competitive products and services that incorporate AI technologies. Chinese AI researchers are involved in many international collaborations, with more than half of Chinese AI papers being coauthored with non-Chinese authors. To develop the country’s human resources in AI, the Chinese Ministry of Education has developed AI research centers, open courses, and teaching materials. Drawing on China’s experiences with telecommunications, Chinese companies and government organizations are working to shape standards on AI to support economic growth and national security.

China has certain advantages over other countries that are individually developing AI, such as weak data protection regulations that have allowed for the collection and sharing of large amounts of personal data (Huw et al., 2021). At the same time, the AIDP calls for China to become a leader in the development of ethical norms and standards for AI, including respect for human rights, privacy, and fairness, although efforts to do so are in the early stages.

Quantum Computing

In 2016, China launched a “megaproject” aimed at making breakthroughs in quantum computing; its funding for quantum information sciences now greatly exceeds that of the United States (Graham et al., 2021). In the country’s 14th Five-Year Plan, both quantum computing and AI are cited as high priorities (CSET, 2021). Although there are different methods of measuring quantum computing capabilities, many individuals using open-source information believe that the capabilities of quantum computers in China now rival the capabilities of those in the United States, and Chinese researchers and organizations now have more patents in the field than do Americans (Graham et al., 2021). And many agree that China has already taken the lead in quantum communications (Kwon, 2020). China has announced that it intends to surpass the United States in quantum technologies and their applications in the military and commercial sectors (CSET, 2021).

In 2021, the U.S. Commerce Department, worried about the encryption of sensitive U.S. communications, blocked U.S. firms from exporting quantum computing technology to eight Chinese companies and laboratories. However, China’s stated desire to lead the world in quantum technologies and its cultivation of talent in the field indicate that technology controls may do little to slow its advance (Kania and Costello, 2018).

HUMAN RESOURCES IN THE UNITED STATES AND CHINA

The productivity and quality of the scientific research and technological development carried out in a country reflect the education, creativity, and dedication of the people doing that work. In this respect, the United States has been singularly fortunate. Bolstered by the nation’s historical strengths in

manufacturing, engineering, industrial organization, and innovation, STEM fields have historically attracted many talented U.S. students for both study and work. Over the course of the 19th and 20th centuries, scientists and engineers educated in the United States transformed the nation from an afterthought in the global scientific enterprise to a science and technology powerhouse.

In addition to the nation’s domestic sources of talent, many gifted and accomplished scientists, engineers, and entrepreneurs from other countries have come to the United States to study, do research, teach, work in industry and government, start companies, and otherwise contribute to the U.S. economy and society. Since the first Nobel prizes were awarded in 1901, Americans have accounted for more than a third of the approximately 900 recipients of the prize—nearly three times as many as the second-place nation, the United Kingdom—and about a third of the prizes in physics, chemistry, and medicine have gone to scientists who immigrated to the United States (NFAP, 2019). While Nobel prizes are just one measure of a nation’s competitiveness, the U.S. dominance in this regard reflects the country’s historical attractiveness as a place to learn and do science.

International Students in STEM Fields

As noted in Chapter 3, the number of international graduate students in U.S. colleges and universities has grown rapidly in recent decades, rising from under 250,000 in 2000/2001 to close to 400,000 in 2016/2017, although immigration policies and COVID-19–related restrictions have coincided with a slight decline in those numbers in recent years (Figure 4-2) (Israel and Batalova, 2021; Open Doors, n.d.). The number of international students enrolled in U.S. universities declined in 2020 as a result of the COVID-19 pandemic, but it declined less in graduate-level science and engineering than in other disciplines. Students on temporary visas earn about one-third of the doctoral degrees in science and engineering awarded by U.S. universities, and they earn more than half in some fields, including engineering and computer science (NSB, 2022b).

In the 2018/2019 academic year, an estimated 16 percent of U.S. graduate students in STEM fields—about 40,000 students at the master’s level and 36,000 Ph.D. students—were Chinese (Feldgoise and Zwetsloot, 2020). These 76,000 students represented about 37 percent of all the international graduate students at U.S. universities. The number of Chinese graduate students more than doubled in the decade before 2018/2019, although the rate of growth slowed toward the end of that period.

In surveys of international Ph.D. recipients, more than 70 percent of those in STEM fields have expressed their intention to stay in the United States to work, with the highest rates (more than 85 percent) in computer science, biology, and engineering and among students from China, India, and Iran (Zwetsloot et al., 2020). Intention-to-stay rates, which correlate closely with actual stay rates, either remained steady or increased slightly between 2000 and 2017. Among recent cohorts of international Ph.D. recipients who had temporary

visas at graduation, 70 percent were still in the United States 5 years later, and 62 percent were still here 10 years later (Finn and Pennington, 2018). Foreign-born workers remain an important part of the U.S. STEM workforce, representing 20 percent of that overall workforce and a much higher percentage in some fields.

In recent years, international student enrollment in such nations as Australia and Canada has increased as much as 20 percent, while that in U.S. institutions has flattened. This pattern appears to reflect a mismatch between immigration rules and talent needs in the United States, with inadequate attention being paid to matching employer needs and work/residency visas. In contrast to the immigration systems of other English-speaking countries, such as the United Kingdom, Australia, and Canada, the system in the United States is less focused on skills-based needs (NASEM, 2015). Permanent resident status in the United States is granted mainly to immigrants who are sponsored by family members instead of being employment based (Cohn and Ruiz, 2017). According to the most recent data released by the Department of Homeland Security, only 12 percent of new permanent residents were in management, professional, and related occupations, while 26 percent were not working outside the home (DHS, 2019). The number of highly skilled immigrant workers is growing more rapidly in other Organisation for Economic Co-operation and Development (OECD) countries than in the United States, and the U.S. share of international students has been declining. Undergraduate and graduate students continue to come to the United States, but many of these students study on temporary visas and must return to their home countries 6–9 months after receiving their degrees. In addition, a long tradition of postdoctoral fellows in scientific disciplines coming from Europe to

train in the United States has eroded in recent years, in part as a result of the shifting political landscape (Israel and Batalova, 2021). Recent immigration reforms, such as the expansion of optional practical training, have allowed foreign students to work longer in the United States after completing their degrees, but the number of temporary work visas is capped, even in fields in which workers are in high demand.

Other countries, particularly China, have created incentives to attract students educated and researchers working in the United States to return to their home countries (Permanent Subcommittee on Investigations, 2019). China has invested billions of dollars in research funding, laboratory space, salaries, and other incentives to recruit scientists working abroad. It also has greatly increased its investments in higher education in an effort to create world-class universities in China so that it will have to rely less on other countries for advanced training.

When researchers educated or working in the United States move to China, they take information, experience, and know-how with them—an inevitable consequence of international flows of talent. The movement of people and knowledge from one country to another links the R&D enterprises of nations while also benefiting the recipients of talent. When students return to their home countries, they tend to retain contacts with colleagues from the countries they left, and many draw on these networks in doing research and starting businesses (Saxenian, 2006). At the same time, the home countries are more likely to benefit from the initiative and insights of scientists, engineers, and entrepreneurs returning home from abroad.

International Collaboration

Another way in which China has sought to strengthen its science and technology enterprise is by forming partnerships with researchers working in other countries. For example, China’s Thousand Talents Program, launched in 2008, has recruited more than 7,000 native Chinese and foreign-born scientists to work with researchers in China and spend at least part of every year in that country. Now known as the National High-end Foreign Experts Recruitment Plan, the program seeks to attract high-level researchers to permanent or temporary appointments in China. The U.S. government has expressed concern about the program’s being used to transfer know-how and intellectual property to China and has prosecuted some U.S. scientists for failing to disclose connections to the program.

In 2018 the Trump administration announced a new program, which came to be called the China Initiative, aimed at preventing economic espionage (Aloe and Guo, 2022). The Biden administration has since redirected the program to one aimed more broadly at threats from hostile countries, but the program still retains a focus on academic researchers with ties to China working in the United States. The program has been heavily criticized for charging researchers with lesser infractions than espionage and for ethnic profiling (Mervis, 2022). As described in Chapter 3, the guidelines released by the National Science and

Technology Council in January 2022 were designed to clarify the kinds of international relationships that are allowed and the disclosures that researchers must make about those relationships, although these guidelines are still in the process of being implemented (NSTC, 2022).

In response to concerns about illicit transfers of know-how and technology to China and other countries, universities have reemphasized and strengthened policies and procedures to address security threats and undue influence of foreign government on campus. They have increased training of faculty members and students, heightened protections for data and intellectual property, reviewed collaborations and contracts, and enforced conflict-of-interest and foreign-travel policies, among other measures.

The U.S. federal laboratory system also attracts some of the top scientific and technical talent both nationally and globally, and develops and maintains unique scientific resources not found elsewhere, from high-performance computers to specialized fabrication facilities. Team science is performed on a scale that is difficult to support in traditional universities or industry. Both open and deeply classified work is performed, and there are opportunities for foreign nationals as well as U.S. citizens. Investments in these institutions is part of how the United States cultivates talent and innovation (NASEM, 2021).

The Human Resources Challenge for the United States

To maintain its leadership in science and technology, the United States will need to cultivate both domestic and international talent. Domestically, the United States needs to invest in American STEM education programs to take greater advantage of the talent inherent in U.S. students. Scholarships, internships, targeted hiring practices, postdoctoral fellowships, and early-career opportunities can all increase the participation of U.S. students in STEM programs. Young people are passionate about solving real-world problems, and science and technology offer them ways to work on such problems. However, attracting the best and the brightest to these fields requires appropriate career and financial incentives. Students need to be recognized and rewarded for their efforts and achievements, and they need to have the promise of a good life if they are to pursue STEM careers. For example, the very low salaries paid to postdoctoral fellows in some fields are impeding the development of the U.S. science and technology workforce. The United States also needs more workers with other STEM skills, such as technicians and laboratory safety specialists. Increased government support for STEM partnerships between community colleges and industry could help grow the technically skilled workforce. Such collaborations could also create employment opportunities in regions where traditional employment opportunities have lagged, creating new opportunities for communities to grow and prosper.

The United States will not be able to rely entirely on domestic students to remain a leader in science and technology; it will need to continue to attract and retain students from around the world to realize the massive benefits provided

in the past by talent from abroad. The United States has many advantages—including its open and thriving research institutions, its risk-taking environment, and the personal and professional rewards available for achievement—that appeal to smart and ambitious students. But researchers from abroad would be more likely to stay in the United States if they could bring their families, which would require changes in visa processes. Clearance processes could begin early so that researchers from other countries would be ready to do classified work if the need arose. Today, international students come to U.S. colleges and universities under the condition that they agree to return to their home countries upon graduation. This policy is at odds with the need to retain talent and expertise in the United States.

IMPLICATIONS OF CHINA’S ACTIONS FOR THE PROTECTION OF U.S. INTERESTS

The competitive challenge China poses to the United States is unprecedented. China’s large investments in R&D and higher education, its talent programs, its scientific and technical intelligence efforts, and its leaders’ attention to science and technology all demonstrate the country’s ambitions not just to catch up with the United States in science and technology but to surpass it.

To safeguard, enable, and strengthen its national advantages in science and technology, the United States must take coordinated and comprehensive actions. For both economic and military reasons, the United States has a relatively small number of technologies that it wants to protect rigorously from being acquired by China and other countries. However, broadly applying mechanisms to protect technologies is counterproductive in that doing so impedes U.S. advances in science and technology more than it blocks the international diffusion of technologies.

The most important actions the United States can take are ones that will bolster its own scientific and technological competitiveness. These actions might include an integrated strategy for maintaining U.S. competitiveness that incorporates stronger institutions for technology development and application, enhanced efforts to attract the best students from around the world to U.S. universities (including a compelling narrative that challenges the Chinese narrative of a United States in decline), and increased R&D funding. In addition, any U.S. strategy will need to respond to explicit Chinese strategies that are technology specific and outline direct steps that China is taking to overtake the United States, an effort that will need to start with better monitoring of the actions taken by China and other countries (Brown and Singh, 2018).