While the tensions between the US and China had been building quietly for years, US President Donald Trump’s targeted sanctions on technological exports to China during his first term (2017-2021) marked a turning point. In August 2018, Trump signed the National Defense Authorization Act for Fiscal Year 2019 (NDAA 2019) into law. This imposed technology-related restrictions on China and barred all US federal government agencies from using equipment from Chinese tech giants Huawei, ZTE, Hytera, Hikvision, and Dahua, citing national security concerns. Within two months, the Trump administration cut off Fujian Jinhua, a Chinese chipmaker, from US suppliers on charges of stealing trade secrets, initiating direct restrictions on China's access to advanced semiconductor technology. Later, several Chinese companies were added to the US Department of Commerce's Entity List, including Huawei and Semiconductor Manufacturing International Corporation (SMIC). The Biden administration continued this policy with new export controls that restricted Beijing’s access to advanced computing chips, semiconductor manufacturing equipment, and related technology from both US and allied firms.
From the beginning of his second term, the Trump administration’s tech and trade war against China (and much of the world) intensified. It broadened the scope and enforcement of export controls, adding numerous Chinese technology firms and affiliates to the Entity List, restricting access to both high-end and lower-grade chips. The administration closed loopholes that allowed circumvention via subsidiaries and overseas partners, increased tariffs on a wide array of Chinese goods, and even threatened to revoke visas for Chinese students in sensitive fields.
The U.S. also urged its allies to follow suit. The Netherlands and Japan imposed restrictions on the export of advanced chip-making equipment to China. In the Middle East, the US pushed organizations like the King Abdullah University of Science and Technology in Saudi Arabia and the UAE’s state-backed AI firm, G42, to distance themselves from Chinese technology. Israel also imposed limitations on Chinese companies concerning investment and collaboration in certain critical sectors.
China’s Endeavours for Technological Self-Reliance
In 2015, China announced the ‘Made in China 2025’ (MIC2025) initiative, and in 2017, the ‘New Generation AI Development Plan.’ These initiatives aimed for technological self-reliance, considered critical to countering U.S. dominance and avoiding ‘strangulation’ in vital sectors. China’s 14th Five-Year Plan, announced in March 2021, placed unprecedented emphasis on technological self-reliance and innovation, with concrete goals for R&D investment, digital infrastructure, semiconductor independence, and the development of emerging and future industries. The plan integrated basic research, industry, and digital transformation to foster a globally competitive, innovation-driven economy by 2025. As a result of these measures, China made major strides in key sectors as elaborated.
Leading the AI Race
In the AI sector, Chinese firms developed advanced generative AI models, integrated AI into industrial automation, and achieved global leadership in facial recognition, fintech, smart city systems, and automated logistics, among other areas. In 2025, China’s development of DeepSeek, an AI model, with limited resources, took the world by surprise. By early 2025, China had led the world share in high-quality AI patents. Commenting on Beijing’s progress in AI sector, World Economic Forum in its January 2025 study stated China was ‘positioning itself as a global leader in artificial intelligence (AI)’ to become a ‘primary innovation hub for the technology by expanding its core AI industry to over $140 billion by 2030, and to boost related sectors to $1.4 trillion in value during the same period.’
Semiconductors, chips, and supercomputing
Defying curbs and making progress in semiconductors, chip manufacturing, and supercomputing was particularly notable. Backed by state support and policies, China’s semiconductor market reached $182.8 billion in 2024, with the country expected to achieve 50% self-sufficiency in the near future. Leading companies such as SMIC and Huawei are on track to finalize the production of 5nm chips (nm refers to nanometers; China mainly used 28nm, with a lower number indicating an advancement in chip technology).
Beijing achieved world-leading breakthroughs in supercomputing, developing systems powered by domestically produced GPUs that surpassed the performance of the top US supercomputers. In March 2025, Chinese scientists unveiled the Zuchongzhi 3.0 quantum computer, which operates quadrillions of times faster than the fastest classical supercomputers for specific tasks. These advancements underscore China’s improved self-sufficiency and global competitiveness in high-performance and quantum computing.
Drones and EVs
China is leading the world in drone technology by dominating the civilian drone market (85% global share). China pioneered large-scale transport drones and the world’s first flying taxi drone. Similarly, it is the largest producer and user of industrial robots, and achieved world firsts, such as the development of automated dental implants and highly automated factories.
In the fields of Electric Vehicles (EVs) and batteries China led the world. By November 2024, China’s annual production of EV or new energy vehicles (NEVs) had surpassed 10 million units. Linked to this, China has become the world’s largest battery manufacturer along with dominating battery technology.
Aviation and Aerospace
In the aviation industry, China’s mainly homegrown narrow-body commercial jet, the C919, entered commercial service in May 2023, with major Chinese carriers adopting it. It began regular international flights to Hong Kong and garnered over 1,000 orders (far more than the company can produce) from both domestic and some international clients. China is also developing the C929, a wide-body aircraft, with the prototype expected around 2029. Aviation experts anticipate that China has the potential to challenge the dominance of Boeing and Airbus in the future, especially in the domestic and regional markets. In June 2025, Civil Aviation Administration of China approved the mass production of home-grown AG600, the world’s largest amphibious aircraft.
High-speed railways
China operates the world’s largest and most advanced high-speed rail network, with over 48,000 kilometers in service as of 2024. The country aimed to expand the length of its operating high-speed rail tracks to around 60,000 km by 2030. China’s trains, such as the CR400 Fuxing and the new CR450 prototype, rank among the fastest globally, with the Shanghai Maglev. China’s high-speed rail is recognized for its safety, energy efficiency, and smart management, and has become a major export, with Chinese-built railways and technology adopted in countries such as Turkey, Indonesia, and Laos. The sector is credited with boosting trade, investment, and economic connectivity both domestically and internationally.
Shipbuilding
The US curbs, such as port fees on Chinese-built vessels, blacklisting of major Chinese shipbuilders, and trade investigations to counter China’s dominance in the global shipbuilding industry, remained mainly unaffected. China remained the world’s leading shipbuilding nation, commanding over half of the global market across all key indicators. As of 2024, Chinese shipyards accounted for 55.7% of the global shipbuilding completion volume, 74.1% of new orders, and 63.1% of the worldwide orders booked. Seven of the top ten shipbuilders by order volume are Chinese, with China State Shipbuilding Corporation (CSSC) holding the largest share. China’s dominance is supported by its cost efficiency, integrated supply chains, and the ability to build nearly all vessel types, placing it well ahead of traditional competitors such as South Korea and Japan.
Challenges
Despite these achievements, China continues to face headwinds on its path to self-reliance. C919 has not yet been exported for regular commercial service to foreign airlines, although discussions with carriers in Saudi Arabia and Southeast Asia are underway. China needs certifications from the U.S. Federal Aviation Administration (FAA) and the European Union Aviation Safety Agency (EASA) for the C919 to be accepted for commercial operation globally. Geopolitics is one of the hurdles in achieving these certifications. In addition, China depends on Germany for landing gear and the US and France for engines. In an all-out geopolitical war, restricting the supply of imported equipment would cripple production. In the chip industry, although China’s production increased from 20% to 30% by 2024, it still fell short of the 70% target set by Made in China 2025. The restrictions imposed by the US and its allies continue to pose challenges to advancements.
At the same time, China’s rapid advancements in certain technological sectors rival those of other nations. For example, China’s phenomenal growth of EVs raised significant concerns within the EU, which launched anti-subsidy investigations, citing overproduction and unfair state support as threats to European manufacturers. Other countries such as the US, Brazil and Turkey also implemented or considered measures to limit Chinese EV imports in response to concerns about market disruption.
Conclusion
To conclude, U.S. restrictions aimed at obstructing China’s technological development have, in practice, accelerated China’s pursuit of technological self-reliance. Through a combination of state-led investment, institutional reforms, indigenous innovation, strategic protectionism, and, above all, determination, China has systematically reduced its dependence on foreign technology, particularly from the U.S., and has begun developing an indigenous technology ecosystem. In an age of interdependence, complete decoupling is unimaginable; however, China has achieved a level of self-sufficiency that minimizes its vulnerability to coercion. This was evident in China’s tit-for-tat response to Trump’s tariff war. China has accomplished these milestones within a decade. Looking ahead, even if the ongoing U.S.-China trade negotiations progress smoothly, China’s momentum toward self-sufficiency is likely to persist.
