“China is winning on all fronts,” goes the refrain as the year draws to a close. The country has not only won the trade war with the United States; it is also on its way to becoming a high-tech superpower.
These claims are largely true, and many people ask: How has a country that was so poor fifty years ago managed to rise so abruptly? The answer is, of course, complex, but much of the explanation lies in the fact that China’s ancient creative capacity never completely disappeared. It merely lay dormant—until Mao’s successors roused it into action.
In our Europe-centred historical tradition, we are prone to overlook the fact that China was for centuries an economic and political great power. The red thread running through Marco Polo’s travel account from the second half of the thirteenth century is the prosperity he witnessed. “The Chinese surpass all other nations in refinement and in knowledge of many things,” he wrote.
Around the year 1800, the country accounted for a third of all world trade. Port cities such as Guangzhou, Quanzhou, and Shanghai teemed with proud vessels, and the empire seemed invincible.
Paper revolutionised human civilisation. It was invented in China and refined in the second century CE by the official Cai Lun, who produced a kind of cellulose from bark and hemp. The end product was lighter and cheaper than parchment and paved the way for a literate society long before Europe. Printing—both with woodblocks and with movable type—was developed in China several centuries before Johann Gutenberg (c. 1400–1468).
Gunpowder, too, has its origins in the Middle Kingdom. Daoist alchemists searching for the elixir of life mixed sulphur, charcoal, and saltpetre—and instead discovered an explosive compound that transformed the world’s military technology. By the twelfth century, Chinese arsenals contained everything from fire arrows to hand cannons. Under the Song dynasty (960–1279), the authorities began issuing so-called jiaozi. These were the world’s first state-backed paper banknotes, printed with elaborate seals and designs to prevent counterfeiting. The economy thus became more mobile and efficient.
But it was during the Qing dynasty’s heyday in the eighteenth century that China reached its economic and cultural peak. The population grew to more than 300 million, agriculture became ever more efficient, and rivers and canals bound the empire together. Coastal cities swelled and attracted merchants from India, Arabia, Persia, and Europe. Chinese porcelain, tea, and silk became coveted luxury goods, and European trading companies willingly paid in silver to partake in the wealth.
The court of Emperor Qianlong in Beijing symbolised this power. The palaces of the Forbidden City shone with art and science, and learned men filled the empire’s institutions. Foreign ambassadors were received with majestic calm, but also with a hint of superiority. When the British envoy Lord Macartney in 1793 attempted to open China to free trade, the emperor replied coolly: “We possess all things. I set no value on objects strange or ingenious, and have no use for your country’s manufactures.”
Yet this episode also marked a turning point. Precisely when China was at its most powerful, the world’s centre of gravity shifted westward. The Industrial Revolution began in England, creating a new dynamic that a self-satisfied China failed to grasp. Moreover, why should the Chinese have sought to streamline production when labour was abundant?
This paradox preoccupied the British historian of science Joseph Needham (1900–1995), a Cambridge scholar who devoted his life to mapping China’s technological past. His life’s work, Science and Civilisation in China, is one of the most monumental research projects of the twentieth century. The first volume appeared in 1954, and the work has continued into the new millennium.
Needham was a biologist and chemist, but on a journey to China during the Second World War he was captivated by the country’s intellectual richness. He learned Chinese, visited universities and laboratories, and amassed an enormous body of material on ancient inventions and scientific ideas. The more he dug, the clearer the picture became: for centuries, China had been the world’s centre—not Europe.
Still, one nagging question remained, later known as the Needham Problem: why did China’s scientific development stall, while Europe experienced its Renaissance and Industrial Revolution?
Needham himself proposed several explanations. He pointed to the imperial bureaucracy, which ensured stability but also constrained individual exploration and private initiative. In Europe, an inventor could challenge authority and gain support from merchants and princes; in China, science was subordinated to the state and its need for control. Daoist natural philosophy and Confucian ideals of harmony emphasised calm and stability more than curiosity. The result was a society that sought order, not revolution.
Yet Needham refused to accept the entrenched Western notion that China was “static.” On the contrary, he argued that Chinese science had developed in step with society’s needs, and that the West gained an advantage only when colonialism, war, and capitalism altered the rules of the game. He warned against judging China by European yardsticks.
His work opened the eyes of an entire generation of scholars. Volume after volume documented how the Chinese had long been in the lead. The Chinese polymath Shen Kuo described the principle behind the magnetic needle and the Earth’s magnetism in 1088—six hundred years before William Gilbert did the same in England.
Today, as China once again takes the lead in technological development, it is as if Needham’s books have acquired an afterword written by history itself. The country is not rising for the first time, but for the second.
China’s nominal gross domestic product (GDP) is now the second largest in the world, after that of the United States. This ranking is based on current dollars, in which exchange rates play a major role. Adjusted for purchasing power in both countries, China’s economy is the largest. This means that the Chinese benefit from a lower price level and get more value for their money.
Since the 1980s, China has rapidly closed the gap with the United States. Ten years ago, it was common to predict that China’s nominal GDP would soon surpass America’s, but in recent years the catch-up has slowed somewhat—largely because growth in China has eased and the United States has performed better than expected. Even so, China’s economic advance has been remarkable.
But which of the two is leading the high-tech race?
The general answer is that they lead the world together, but in different areas. On several measurable technological fronts, China is in the lead, often clearly ahead of the United States. The Chinese are world leaders in what is known as applied technology—such as high-speed rail, electric vehicles, battery technology, solar power, and wind energy. This is not laboratory technology, but technology in massive use. They have also gone furthest in developing and deploying industrial robots. And they are well ahead of the United States in building a digital infrastructure across all sectors of society. In 2026, a powerful wave of artificial intelligence will sweep across the country.
At the same time, the United States enjoys clear advantages in other areas. It still has the world’s best universities and appears more innovative than China. The world’s leading technology companies are American, developing everything from operating systems to cloud storage and new AI platforms. Even though the United States under Trump has taken several steps backward, the country continues to attract talent from around the globe. In military technology as well, the United States possesses cutting-edge expertise that China lacks—at least for now.
The question many ask is whether China, under the leadership of a strict Communist Party, will be able to surge ahead and become number one in all fields. There are almost as many answers as there are experts. Much will depend on the party’s capacity to govern—on whether it can strike the right balance between control and creative freedom.
Another unresolved question is the impact of the inevitable population decline. China currently has just over 1.4 billion inhabitants, but will lose between 80 and 90 million over the next 25 years. Looking further ahead, to the year 2100, the population could shrink to below 700 million, according to the United Nations. At the same time, ever fewer working-age people will have to support ever more elderly citizens. Already, kindergartens are being converted into nursing homes. Never before has a country experienced anything comparable.
A third decisive factor will be the international climate. Emperor Qianlong, who ruled from 1735 to 1796, believed China could manage on its own. That is not possible under today’s conditions, nor in the years to come. The only question is: how much resistance will the country encounter? In both the United States and other Western nations, China faces growing scepticism and criticism.
China’s road to a bright future will in any case not be a straight motorway. But the same can be said of the United States, the European Union, and many others.
“The world is entering a more fragmented and unstable phase,” says UN Secretary-General António Guterres.
All indications suggest that he is right.
