Mei Yonghong is Director and Executive Vice President of China’s private BGI Group, one of the world’s leading life science and genomics organisations that, in recent years, has become a prime target in the U.S. The Center for Security and Emerging Technology, a Georgetown University thinktank, described BGI as “taking on the same role in the biotech space as Huawei has in telecommunications” in a 111-page report in May 2024.
Immediately before joining BGI, Mei was Mayor of Jining, Shandong Province, between 2010 and 2015. Before that, he served as Deputy Director-General of the General Office, Director-General of the Research Office, and Director-General of the Policy, Regulation, and System Reform Department of the Ministry of Science and Technology (MOST).
Mei’s resignation from the mayor position in 2015 became national news because in China, a 50-year-old official at that level, equivalent to a Director-General in a central government ministry, rarely abdicates considerable government power to work in private business. (Yes, many Westerners don’t, but the Chinese people in China genuinely believe BGI – and Huawei and others – are private businesses.)
Below is a recent speech made public last month by a non-governmental think tank he now chairs. It is interesting in many ways:
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Strait talk from someone with such government and private sector experience on an exciting and essential subject is not easily found.
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While highlighting the amazing achievements of China’s science and technology development and economy, Mei revisits some anecdotes contrasting with the narrative that Beijing has long planned for everything. Then spokesperson of China’s National Bureau of Statistics, now often viewed as suspicious for inflating China’s growth, openly predicted in 2002 that China could only become the world’s second-largest economy in 2050 (It happened in 2010). In another example, China’s favored and protected state-owned automobile companies turned out effectively useless, and only private carmakers that had long been discriminated against at home are now taking the lead.
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Mei believes, as perhaps the Chinese mainstream view generally holds, that science and technology advancement is the overriding determining factor in the U.S.-China competition. More market-friendly economists might disagree with this.
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Mei characterizes some U.S. scientific and technological breakthroughs, including its moon landing and, more recently, SpaceX, as a result of a sort of nationwide, government-driven mobilization. The view that the U.S. government also significantly supports U.S. companies with various measures has long reverberated with a sizeable Chinese audience who view the U.S. complaints of Chinese state subsidies with deep suspicion.
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Mei offered substantive criticism of the role that the Chinese government played in fostering scientific and technological development, blaming it for a series of problems. For example, the acknowledgment that Beijing “did too many things that it shouldn’t have done and couldn’t do well” from someone with significant experience in MOST is fascinating. He also decisively recognized that China’s hope for innovation only lies in private enterprises and urged Beijing to embrace the market as a driving force for future technological advancement.
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However, Mei also, in the end, called for state assistance to a few leading national champions, saying Beijing hasn’t given meaningful aid to the Chinese companies that the U.S. has blacklisted – they now “often find themselves isolated.”
Mei also quoted remarks made by Thomas Friedman, The New York Times columnist, with Henry Huiyao Wang, founder and President of the Center for China and Globalization, in 2021: “When China sold us only shallow things, politically speaking, we didn’t care whether China was authoritarian, communist, libertarian or vegetarian. It didn’t matter because you were just selling us shallow goods.”
From the CCG archive: A Dialogue Between Wang Huiyao and Thomas L. Friedman: The World is Faster, Deeper, More Fused and Open, Also Fragile
Thomas L. Friedman:
And over those 40 years, China and America became in some ways, one country, two systems. We really got fused together. Now, that era, unfortunately, is over. Why is it over? I’m gonna come back to the word “deep” – because for most of those 30 -40 years, China sold us mostly shallow goods, clothes we wore on our shoulders, shoes we wore on our feet, solar panels we put on our roof. I call those shallow goods. We sold China deep goods, things like computers, software, things that went inside CCG, right in your office – American computers, software, right in Henry’s office, right in his home. We sold you deep things, you sold shallow things, for the most part, okay? When China sold us only shallow things, politically speaking, we didn’t care whether China was authoritarian, communist, libertarian or vegetarian. It didn’t matter because you were just selling us shallow goods. But when China, by its own technological development over the last 10 years, has been able to make deep goods – Huawei, 5G, very deep goods. Now they come to America and said, we want to sell you deep goods, just like you sold us your deep goods. We want to sell Thomas Friedman Huawei what will go in his house and answer his telephone. And what we said was wait a minute, when you were just selling us shallow goods, we didn’t care about your political system. But if you want to sell me deep goods, here in Bethesda, if you want Huawei to answer my phone – suddenly, the difference in values matters.
The following remarks were originally published on the official WeChat blog of Huagu Biotechnology and Bioindustry Research Institute, a non-governmental, non-profit thinktank set up in 2023 by biotech and agricultural companies in China, including BGI’s affiliates.
According to the blog post, Mei was speaking at a seminar organized by the CITIC Foundation for Reform and Development Studies. The specific timing of the speech was not immediately available, but it apparently took place close to the November 5 U.S. election in 2024.
Recently, discussions surrounding China-U.S. relations have garnered much attention, and the U.S. presidential election has stirred the nerves of many Chinese people. I would like to share some of my thoughts on this topic.
First, the tension between China and the U.S. is fundamentally structural, and I will illustrate this with some data and examples.
Economically, over the past 30 years, China has achieved remarkable economic progress, rare in human history. 30 years ago, Germany and Japan’s per capita GDP was 80 times that of China, South Korea was 30 times, and Hong Kong was nearly 40 times. Malaysia was also 10 times larger than China, Thailand 7 times, the Philippines and Myanmar 3 times, and India was slightly ahead of China. Today, the situation has completely reversed. The ratio of per capita GDP between Germany and China has changed from 80 times to 4 times, Japan, South Korea, and Hong Kong are all around 3 times, and the other countries have all been surpassed by China. India’s per capita GDP is $2,600, only one-fifth of China’s.
The economic transformation of China in comparison to the United States is equally striking. In 1981, China’s GDP was only 6% of the United States’, and by 1991, it was 6.2%. By 2001, it had doubled to 12.7%. In 2011, it reached 48%, and by 2021, it had grown to 74%. The contrast from 6% in 1981 to 74% in 2021 is truly dramatic and stark and has undoubtedly led to some structural tension and contradictions between the two sides.
Let’s take a look at technology. Having worked in the Ministry of Science and Technology and studied related strategies and policies for many years, I have witnessed the evolution of China’s science and technology over the past 20 years.
In 2003, China started compiling its National Medium- and Long-Term Science and Technology Development Plan, when the country had minimal achievements in high-tech fields and struggled to keep pace with developed nations. However, significant progress has since been made: manned space missions, space stations, and lunar landings in the aerospace sector have become a reality.
Satellite positioning and navigation were once a significant bottleneck for China. The Chinese commercial ship Yinhe was compelled to undergo an unjustified inspection after the U.S. disabled its GPS signal in the Indian Ocean [Note: “NO CHEMICAL ARMS ABOARD CHINA SHIP,” the NYT reported after the inspection]. Similarly, reliance on GPS was a factor in the premature conclusion of the 1996 military exercises around Taiwan. However, developing the BeiDou Navigation Satellite System is a critical breakthrough, freeing China from dependence on foreign systems.
The large passenger aircraft program is a field I extensively studied during my time at the Ministry of Science and Technology. In the 1980s, China initiated the Y-10 project, which ultimately fell into neglect, leading to nearly two decades of stagnation. When I began participating in strategic research on large passenger aircraft in 2000, most government departments believed it couldn’t be done, and even if it could, it wouldn’t be commercially viable.
Today, however, China’s C919 has successfully taken flight and entered commercial operation, while the C929 wide-body passenger aircraft is under development. During a recent visit to the Commercial Aircraft Corporation of China (COMAC), I witnessed the remarkable progress achieved over the years—I was truly moved.
The story is similar for new energy vehicles (NEVs). Twenty years ago, when the Ministry of Science and Technology was drafting the National Science and Technology Major Project, there was a proposal for NEVs, but it was rejected. At the time, most believed that China had little chance of making an impact in the automotive industry and would be limited to CKD (Completely Knocked Down) assembly. Despite decades of policy support, the major state-owned car companies achieved little and essentially just coasted along.
Unexpectedly, a remarkable turnaround came. Companies like Chery, Geely, and BYD, which once faced exclusion and pressure, have risen to the top, restoring the reputation of Chinese automobiles and taking them to international markets.
The same is true for 5G. There was a time when China struggled even with 3G. As a result, when China launched its 3G mobile communication standard, it became the only country in the world to adopt three standards: its own TD-SCDMA, as well as the Western standards CDMA2000 and WCDMA. This meant that China paid three times the cost for a single telecommunications service, which was extremely rare worldwide. This was because, at the time, China’s technology lagged far behind, and the government doubted whether TD-SCDMA could achieve commercial viability, necessitating a compromise. Today, however, China is a global leader in 5G.
Then there’s the deep-sea manned submersible. Last year, I participated in an expedition to the waters surrounding Oceania aboard China’s independently developed Fendouzhe (Striver) submersible, spending six hours on the seabed. The Fendouzhe can reach depths of 10,000 meters in the Mariana Trench as effortlessly as navigating flat ground. Currently, China is the only country in the world with a submersible capable of reaching such depths and operating effectively. This is not just a simple submersible; it represents a comprehensive technological system showcasing China’s advanced capabilities in areas such as automation control, new materials, communications, lighting, power, and system integration.
There are many similar examples, such as ultra-high-voltage electricity transmission (UHV electricity transmission), coal-to-liquids (CTL) technology, hydrogen production from coal, Generation III civilian nuclear reactors, fusion power, high-temperature gas-cooled reactors (HTGRs), nuclear magnetic resonance (NMR), quantum communication, genetic engineering, and more—each developed from scratch.
In the past, DNA sequencers in China depended entirely on the United States. This left China reliant on foreign technology and exposed its biological data to potential external access. Today, however, China has overcome this dependency. BGI Group‘s self-developed DNA sequencers have surpassed performance, cost-efficiency, and safety expectations.
Two years ago, BGI Group filed an intellectual property lawsuit against Illumina, a leading U.S. company, in an American court. The court ruled that Illumina had willfully infringed on BGI Group’s patents and awarded $334 million in damages—the largest compensation in the history of China-U.S. intellectual property disputes. This milestone reflects that China has transitioned from being a technology learner to a technology leader.
These advancements, mainly achieved within the past two decades, have introduced new complexities into China’s relationships with the U.S. and the broader West.
Behind international relations are always interests, and today’s reversal of China-U.S. and China-West relations is no different. In the 1980s, the U.S. forced Japan to sign the Plaza Accord, employing policies such as market access, tariffs, and exchange rates to suppress Japan’s economic rise. This led to three decades of stagnation for the country.
Consider the data: in 1995, Japan’s GDP was twice that of Germany, eight times that of China, four times that of the UK, and ten times that of South Korea. Japan’s economy accounted for 73% of the U.S. GDP. A country with a population of 130 million had an economic scale reaching 73% of that of the U.S., and had completely surpassed the U.S. in the semiconductor industry—what an astonishing miracle!
By 2022, however, everything had reversed. China’s GDP is now 4.5 times that of Japan, and the U.S. is six times Japan’s GDP. Japan is now 2.5 times larger than South Korea, and Germany has surpassed Japan. The Japanese electronics giants that once dominated China in the 1990s—Sony, Panasonic, Toshiba, Sharp, and Sanyo—are now a thing of the past. The Plaza Accord and the U.S.-Japan Semiconductor Agreement basically knocked Japan down.
Similarly, the competition in high-tech fields is not an ideological issue; at its core, it is a struggle for interests. If the United States could treat its close ally Japan as it did, what would it do to China? As former Singaporean Ambassador to the U.S. Chan Heng Chee said, the U.S. stance on high-tech industries is, essentially: “It is ours”, emphasizing that these sectors are their exclusive domain, which cannot be automatically ceded.
Over 20 years ago, renowned U.S. economist Paul Samuelson had a conversation with Peking University Professor Zhou Qiren. At that time, China could only produce clothing, shoes, and hats and engage in processing trade, while the U.S. dominated high-tech industries—this is why the trade model was often described as “700 million shirts in exchange for one Boeing aircraft,” [800 million shirts for just one Airbus A380] where one shirt earned just one yuan. It was a mutually beneficial system with little conflict. Professor Zhou made a hypothetical: What would happen if China decided to manufacture large aircraft one day? Samuelson immediately responded, without hesitation, that it would be America’s “permanent measurable loss.”
[Note: we have been unable to locate a public record of such a dialogue between Samuelson and Zhou. However, Samuelson did explore a hypothetical scenario in his 2004 paper, “Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists Supporting Globalization” (Journal of Economic Perspectives, 18(3): 135–146), where the United States could suffer long-term harm from China’s technical progress. Zhou Qiren addressed this scenario in a 2006 essay.]
Thomas Friedman is a columnist for The New York Times and a proponent of globalization. His major work The World Is Flat once enjoyed immense popularity in China. Recently, he said: “When China sold us only shallow things, politically speaking, we didn’t care whether China was authoritarian, communist, libertarian or vegetarian. It didn’t matter because you were just selling us shallow goods.” This is his exact quote. His version of globalization essentially seeks to position China as the West’s cash cow.
[Note: Thomas Friedman made the remarks in 2021 in a dialogue with Henry Huiyao Wang, President of CCG—not that recent.]
What has disappointed and shocked the West is that China’s development and changes over the years have been too vast and rapid. A 2002 report by the People’s Daily newspaper, covering the 16th National Congress of the Communist Party of China (CPC), projected that China’s economy could become the second largest in the world by 2050. However, just a decade later, China surpassed Japan, and today its economy is 4.5 times larger than Japan’s. From 1990 to 2023, China’s GDP grew 38 times, India grew more than 5 times, while other countries grew less than 4 times, with Italy and Japan experiencing negative growth. Some say that the “profound changes unseen in a century” refer to the rise of China, and judging by the data alone, it’s not an exaggeration.
Therefore, it is unsurprising that the United States has been cracking down on Chinese technology, and this pressure will only intensify. China cannot afford to harbour any false hopes.
Take BGI Group as an example. Since 2018, BGI Group has been subject to a Section 301 investigation and has been added to the U.S. Entity List, with four of its affiliated entities now included, and pressure continuing to escalate. The U.S. International Emergency Economic Powers Act prohibits the transfer of human ‘omic data other than human genomic data to China, specifically targeting BGI Group. Additionally, the U.S. BIOSECURE Act directly names five companies, three of which are BGI Group subsidiaries: BGI, MGI, and Complete Genomics.
A U.S. think tank, the Center for Security and Emerging Technologies (CSET), recently released a report titled China, Biotechnology, and BGI Genomics—How China’s Mixed Economy Distorts Competition. This 111-page report offers the most comprehensive and detailed analysis of BGI Group, emphasizing that “BGI Group has grown into an international competitor, taking on the same role in the biotech space as Huawei has in telecommunications.” This is the sole justification for the U.S. crackdown on BGI Group.
The United States is currently exerting a full-scale crackdown on BGI, which I summarize as the “Four Alls.”
First, all of government—it’s not just the Department of Commerce; the Department of Defense, the State Department, and other government agencies are now all involved.
Second, all of society—it’s not just business competitors; NGOs, universities, and the scientific community have all joined in.
Third, all sectors—it’s not limited to trade; the issue has escalated to a national security matter, with academic exchanges and personnel exchanges now restricted.
Fourth, all of the West—it’s not just the U.S.; many Western allies have also taken action. Some European countries with a history of close cooperation with BGI Group, including Germany, Denmark, Sweden, and the UK, have begun severing ties with the company. Additionally, several of BGI’s partners in the Middle East have explicitly said that the United States is applying pressure to end their collaboration with BGI Group.
Last year, the German government established an internal policy specifically targeting BGI Group, which stated: BGI’s equipment, no matter how advanced, cannot be purchased; BGI’s services, no matter how good, cannot be used; data obtained using BGI’s equipment must be discarded, and the experiments must be redone with American equipment; papers co-authored with BGI cannot be published; and participation in the BGI-led Spatiotemporal Omics Consortium (STOC) is prohibited. This demonstrates that the U.S. not only has strong hard power but also immense soft power, able to mobilize global resources to target a single Chinese company.
In the face of an increasingly complex and severe geopolitical environment, what should China do? I believe the key is to focus on self-improvement. The core of the U.S.-China rivalry is the technology war. Technology war is the Battle of Triangle Hill [Note: a prolonged and gruelling military engagement in the Korean War]. Many people talk about financial and trade wars, but the deadliest battle is the technology war. The technology war will ultimately determine the fate of both sides. Whether the U.S. Can defeat China or whether China can rise from adversity will depend on the technology war.
I also believe that the technology war is not an encounter battle, but protracted. China is not waiting to perish but is presented with many historic opportunities. Today, the nation has built a strong foundation: it ranks second globally in R&D investment—and definitely the first when measured by purchasing power parity)—boasts the largest number of full-time researchers worldwide, and ranks first in PCT patents. Of the 50 companies worldwide that invest the most in R&D, 12 are Chinese. While China should avoid complacency, it must also resist being excessively self-deprecating.
First, technological development is undergoing a profound transformation. Many at this seminar have highlighted AI, which represents an undeniable and profound revolution. Similarly, the field of life sciences is also on the brink of significant changes, and the impact it brings may be no less significant than that of AI. The combination of AI and biotechnology (BT) is poised to become the dominant technological frontier of the future, potentially surpassing the imagination of all of us today.
Transformation brings opportunity and the potential for achievement. China must concentrate its efforts, make the technology war the core battle, and entirely focus on strategic planning. China cannot allow ourselves to lose the technology war or afford to lose it.
Second, China should guide resources such as capital and talent into private enterprises and accelerate their flow. The hope for China’s innovation lies in private enterprises, which currently account for 70% of new technological inventions, and the vast majority of corporate R&D investment also comes from the private sector. For instance, Huawei invests 160 billion RMB [$22 billion] annually in R&D, and BGI Group invests as much as 2.7 billion RMB [$372 million] in R&D each year.
This long-term, focused investment model in specific directions, coupled with intense competition and market-driven mechanisms, has positioned private enterprises at the forefront of scientific research, fostering technological innovation capabilities that traditional research institutions cannot match. How to ensure that private enterprises play their rightful role, or even take the lead, in the U.S.-China technology war is no longer a question that needs further discussion.
Third, the biggest variable in the “new system for mobilizing the resources nationwide” is marketization. While much is said about the advantages of the Chinese system and the achievements of its system for mobilizing the resources nationwide, it is essential to note that the United States also has a nationwide system, and its efficiency is no less than China’s. Take the Apollo moon landing program as an example: it involved 110,000 people and over 3,000 institutions over 14 years—wasn’t it just a Nationwide System?
Today, Elon Musk’s rapid rise is supported by market forces and a high degree of fusion of government power and market forces. The core technologies of SpaceX are platformed at NASA: their first R&D funding came from NASA, and their first order worth over $6 billion was placed by NASA—the largest single contract in NASA’s history. Even as Musk incurred significant financial losses, American venture capital continued to invest, driving up his company’s valuation. It is this fusion power from society as a whole that has created the legendary Musk.
The “new system for mobilizing the resources nationwide” should move beyond ignoring costs or making extreme sacrifices. Instead, marketization must be its greatest variable. The higher the degree of marketization, the more dynamic and effective the Nationwide System becomes.
Fourth, China needs to adjust the role of the government in building the innovation system. Having worked in government departments for many years, I have a deep understanding of the government’s role in technological development. In the past, the government indeed did too many things that it shouldn’t have done and couldn’t do well. When fostering an innovation ecosystem, the government often acted counterproductively, leading to diminishing returns despite increased investment. For instance, who is responsible for the current evaluation system that prioritizes the quantity of papers published over their quality? The increasing academic bureaucratization and the dominance of academic elites—who are the forces behind these trends? The scattered and duplicated scientific research efforts, along with unhealthy competition—are these related to the government’s allocation of scientific resources? With an increasingly intense technology war, China urgently needs to reflect on these issues and implement reforms. What China lacks today is not money, and not even talent, but an innovation ecosystem.
Fifth, China must provide special relief to key leading technology companies. Over 1,300 Chinese companies have been placed on the U.S. Entity List, encompassing all of China’s leading high-tech enterprises. The U.S. governance model ensures once a company is placed on the Entity List, almost all institutions will choose to retreat or decouple from it—this is totally the Nationwide System at work.
To date, China has not established an effective relief mechanism for the affected companies. Many policies remain abstract and fail to be effectively implemented. The companies that are being targeted often find themselves isolated, unable to receive effective support from the government. When enterprises are charging into the front lines, where are the allies? Where is the logistical support? This is a question that must be answered as soon as possible.
For a piece related to another Chinese biotechnology giant, read Zichen Wang’s takedown of an ill-researched attack against the Wuxi Group from earlier this year.
