How China Is Outperforming the United States in Critical Technologies

China has emerged as the leading global power in the creation of emerging technologies, dramatically outperforming the United States in the vast majority of critical technological fields. A key indicator of this is that China is dominating the United States when it comes to scientific publications.

This is concerning as it threatens to erode U.S. leadership across the innovation landscape. ITIF conducted a comprehensive analysis of China’s innovation capabilities last year, and that research concluded that China’s strategic, state-backed scientific advancement across advanced sectors—driven by bold industrial policy, generous government subsidies, and ecosystem integration—has resulted in a surge of global patents, indicating it has transitioned to become a global innovation leader. China is demonstrating dominance in robotics, leading in battery supply, innovating public health by doubling clinical biotech trials, outpacing in quantum communication with a 1,200-mile QKD corridor, experiencing near-peer achievement in AI output, and narrowing gaps in semiconductors and chemicals.

Similarly, according to the latest findings from Australian Strategic Policy Institute’s (ASPI) Critical Technology Tracker, which evaluates 64 critical technology categories across 8 domains (e.g., artificial intelligence and robotics), show that China leading in 57, while the United States leads in only 7 technology sub-categories. This is concerning because these critical technologies are the key input to advanced sectors that China is quickly overtaking.

When evaluating the top 10 percent of high-quality scientific publications, ASPI finds that China surpasses the United States across all 8 critical technology domains. The gap is particularly pronounced in the energy and environment domain, where China accounts for 46 percent of top-tier publications compared to just 10 percent for the United States. Despite U.S. leadership in AI, China produces more top publications, contributing 30 percent versus 18 percent for the United States. (See figure 1.)

Figure 1: Share of the top 10 percent of quality publications across eight critical domains

China’s dominance is even more evident at the subdomain level. Across the 64 subcategories, there are multiple areas in which China leads the United States by more than 50 percentage points in their respective shares of the top 10 percent of publications. For example, China leads by 60 percentage points in hypersonic detection and tracking technologies. It holds a 56 percentage point lead in high-specification machining processes, which is a key component of advanced manufacturing. (See figure 2.)

Figure 2: Subfields in which China’s share of the top 10 percent of quality publications is more than 50 percentage points greater than the U.S. share

Fortunately, there are some areas where the United States retains a lead over China. In 7 of the 64 critical technology categories, American researchers produce a higher share of the top 10 percent of quality publications. Notable advantages include vaccines and medical countermeasures, quantum computing, and atomic clocks—all areas where the United States leads by at least 10 percent. Furthermore, smaller U.S. leads exist in natural language processing, genetic engineering, nuclear medicine and radiotherapy, and small satellites. (See figure 3.)

Figure 3: Subfields in which the U.S. share of the top 10 percent of quality publications is greater than China’s share

Additionally, ASPI identifies 24 technologies at high risk of becoming monopolized by China and another 19 at medium risk. This assessment is based on China’s share of the world’s top 10 research institutions and its publication lead over the next-closest competitor. Many of the high-risk technologies have clear defense applications, such as radar, advanced aircraft engines, drones, swarming and collaborative robots, and satellite positioning and navigation. (See table 1.)

Table 1: Technologies at risk of becoming monopolized by China according to ASPI

China’s progress is the result of decades-long investments in education and research aimed at building technological capability. These investments are now yielding significant returns, with implications for military, economic, and scientific leadership. China’s aggressive talent recruitment programs, such as the Thousand Talents Plan, have successfully lured foreign-educated science and technology experts to help accelerate progress in specific industries, particularly semiconductor manufacturing. Furthermore, China’s heavy emphasis on STEM education has led it to award more STEM degrees than any country in the world—more than four times the number awarded in the United States.

Importantly, the Chinese government has also established strong linkages between academia, industry, and the military as part of its “Military-Civil Fusion” strategy. By eliminating institutional barriers between the civilian and military sectors, China has stimulated the rapid development of emerging technologies in service of its national defense and strategic ambitions.

To adequately respond to China’s recent progress, U.S. policymakers need to once again forge productive relationships between government, academia, and the private sector that characterized the mid-twentieth century. They can start by expanding, rather than cutting, federal science and engineering research budgets. Additionally, the application process for federal grants must be streamlined to allow scientists to spend more time conducting groundbreaking research, rather than navigating bureaucratic red tape. Congress should double the R&D tax credit to better support private-sector innovation. Furthermore, given China’s momentum, the United States must adapt and take action by adopting elements of China’s innovation playbook which includes industrial research institutes, public-private capital mechanisms, expedited manufacturing incentives, and alliances on critical technology.