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Economy

China intends for self-driving cars to propel smart megacity

President Xi's Xiongan project challenges US tech dominance and free market innovation

A self-driving car developed by Baidu performs during a March 22 road test in Beijing. The company plans a research center for automobile technologies as part of the Xiongan smart megacity.   © Getty Images

BEIJING -- China envisions self-driving technology for all private cars in a cutting-edge metropolis to be completed near Beijing by 2035, taking aim at U.S. supremacy in autonomous vehicles and pitting authority-driven progress against free market innovation.

The Xiongan New Area project represents an attempt by the ruling Communist Party to use developmental dictatorship -- the pursuit of economic growth at the expense of public participation in politics -- to build infrastructure and legal systems at a pace other countries cannot match.

President Xi Jinping unveiled the ambitious Xiongan project last year as part of a "millennial strategy." The high-tech "smart" city will be built about 100km southwest of the Chinese capital in a rural zone of Hebei Province. The population is projected to surpass 2 million by 2022, with the megacity eventually rivaling Tokyo by expanding to an area of about 2,000 sq. km. Total investment looks to reach 2 trillion yuan ($313 billion).

A model area within the zone will be designated for developing autonomous-driving technology based on artificial intelligence as well as providing support for related industries, according to a government outline released in April.

Much of the city's transportation infrastructure, including roads and railways, will be built underground, said former Shanghai Mayor Xu Kuangdi, who helped draft the plans.

Construction workers build the Citizen Service Center of Xiongan New Area in China's Hebei Province. The smart city is planned to eventually rival Tokyo in size.   © Getty Images

Self-driving private vehicles will complement public transport systems, said Chen Gang, the project's overseer and secretary of the Xiongan New Area CPC Working Committee.

Designing the new megacity around self-driving automobiles eliminates problems associated with adapting existing infrastructure to cope with a mix of regular and automated vehicles -- as well as pedestrians. China hopes to use Xiongan as a model for future cities worldwide.

In March, a self-driving car struck and killed a pedestrian while being tested by ride-hailing company Uber Technologies on a public road in the U.S. state of Arizona. The incident highlighted the difficulty of handling the unexpected events that arise from incorporating automated driving into existing frameworks.

The international Geneva and Vienna conventions on road traffic assume alert and observant human drivers, which creates difficulties for many countries in building legal systems to accommodate highly autonomous vehicles. But China has ratified neither, and the Communist Party can use its unchecked authority to shape laws and otherwise prepare an environment for automated driving.

China's Changan Automobile launched "level 2" self-driving technology for the consumer market in March, an international standard in which cars can assist in functions such as accelerating and braking. Level 5 represents full automation.

But that puts the country behind foreign automakers such as Germany's Audi, which plans to debut a luxury sedan this year that in some markets will feature the world's first commercial level 3 automated driving. China's government aims to lean on the accelerator for development.

Chinese web search company Baidu was awarded the chance to help develop the Xiongan smart city. Teaming with the Hebei government, Baidu plans a research center for automobile technologies using AI and other tools. Public transport infrastructure and self-driving tech are being developed cohesively under the project, and tests using advanced 5G data networks began in March in cooperation with state-owned China Telecom.

Beijing's push to promote technology and infrastructure for autonomous driving -- and spread them globally -- stirs wariness in Washington. Peter Navarro, trade policy adviser and assistant to U.S. President Donald Trump, has said China seeks to dominate these "industries of the future" including AI.

The struggle for high-tech hegemony appears to be eclipsing the U.S. trade deficit as the focal point of Sino-American trade tensions. Washington not only accuses Beijing of violating intellectual property rights, but also criticizes China for heavily subsidizing technological development.

Since the 1960s, many emerging nations in Asia and South America curtailed public participation in government in the name of rapid growth and modernization. Many of the countries have shifted toward democracy as they develop, but China remains an exception. Despite China becoming the world's second-largest economy, the Communist Party still calls the shots and domestic businesses, whether private or state-owned, move in step to achieve the targets set by the party. Such a system appears as alien to those accustomed to free markets.

Yet foreign automakers and information technology companies flock to China. The Baidu-led development project includes Ford Motor and Germany's Daimler as well as U.S. chipmakers Intel and Nvidia and computing giant Microsoft. Beijing urges participation by foreign businesses, looking to assimilate cutting-edge technology and overseas development.

China remains the world's largest new-car market, with unit sales of 28.87 million last year standing 70% greater than the second-place U.S. The movement of such a large market toward automated driving with strong government backing cannot be ignored, said an executive at a major automaker outside China.

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