HONG KONG -- There were 1,000 of them dotting the night sky, floating gracefully like glowing purple, red and blue Chinese lanterns. It was the largest-ever demonstration of drones flying in formation, a spectacle that drew gasps from the crowd gathered in Guangzhou, China, to mark the end of the Lunar New Year.
Though it had the festive air of a holiday fireworks display, the Guangzhou drone show in February would be cited less than two weeks later in a U.S. congressional hearing on advanced Chinese weaponry. In testimony before the U.S.-China Economic and Security Review Commission, Elsa Kania, a former Pentagon analyst and expert on China's military technology, referred to the performance as a "demonstration of swarming techniques" with clear military applications. Chinese experts, she noted, said the same technology behind the stunning air show could be used in a deadly "distributed system with payload modules mounted on small drones."
The February drone show was a perfect illustration of China's progress in developing "dual-use" technologies -- cutting-edge tech that has both civilian and military applications. China, like the U.S., is pushing hard to develop dual-use technologies in areas from artificial intelligence and robotics to virtual reality and gene editing. Such investments can have twin payoffs for the military and the overall economy. The U.S. Department of Defense can spend its budget dollars on research into unmanned flight technology that benefits the military, for instance, and the resulting advances could end up in private-sector drones that will one day deliver parcels to e-commerce customers. The transfer of technological know-how can also flow from the private sector back to the military.
Kania, a fellow at the Center for a New American Security think tank, testified that China's military is seeking to use dual-use technologies such as drones, artificial intelligence and automation as "force multipliers" for its military power. If the People's Liberation Army mastered such technologies, she said, it could alter the military balance in the Asia-Pacific and intensify the challenges facing the U.S., Japan, South Korea and their other allies in the region.
Swarming drones are just the start. Other Star Wars-like weapons that are raising concerns across the Pacific include laser-guided bombs, "jammers" that disrupt satellite communications, particle-beam armaments, and electromagnetic and microwave instruments of destruction. Richard Fisher, an analyst at the International Assessment and Strategy Center, spotted Chinese fiber-optic lasers -- a technology vital for laser combat satellites -- at an exhibition this year in Abu Dhabi. Other experts say China would like to establish base stations on the moon with both military and civilian objectives.
"China is progressing in a very wide range of major military technological megaprojects," Andrew Erickson, a professor at the U.S. Naval War College, said.
For the first time since the end of the Cold War, U.S. military supremacy is no longer unchallenged -- a fact that has massive implications for the U.S. economy and its security alliances around the world. China's advances in such futuristic technologies -- and U.S. efforts to counter them -- will have ripple effects on the entire Asian region. Increasing tensions could draw in Japan as it reconsiders its military stance.
For years, Asia has been the beneficiary of relative peace, which means that it has been able to dedicate its burgeoning reserves to the prosperity of its people rather than to weapons spending. Now, some are asking if this is about to change.
Ash Carter, U.S. defense secretary under President Barack Obama, described Asia earlier this year as "the single most consequential region for America's future." "It will be necessary for the U.S. to continue to sharpen our military edge so we remain the most powerful military in the region and the security partner of choice," he said, adding that China was "far and away the largest transgressor of the principle of nonmilitarization."
This little-acknowledged arms race is part of a technological competition between the two largest economies on the planet. While tempting to portray that competition as the 21st-century equivalent of the Cold War 60 years ago, such analogies are inaccurate because the nature of war has fundamentally changed.
New technologies "will perhaps give future warfare unmanned, intangible and silent" characteristics, the most recent edition of "The Science of Military Strategy," a Chinese textbook, states. China is hastening the advent of such warfare based partly on its estimates of how the U.S. military will look in the future. One study cited in the PLA Daily last year suggested that by 2040, robots and other unmanned systems will outnumber people within the American armed forces.
Today's conflicts increasingly take place in what military parlance labels a "gray zone." In the past, war was waged between governments or identifiable groups with clear motivations, but now nonstate actors or even individuals can launch what would traditionally be considered acts of war without revealing who they are or even what their objectives might be. If, for example, a military communications satellite is hacked, is it an act of war? And how does a country retaliate if no one claims credit for it?
Soar dragon, divine eagle
In February, a research paper called "China's Technology Transfer Strategy" detailed the risks of China's accessing "the crown jewels of U.S. innovation." Produced for the Defense Innovation Unit Experimental (DIUx), an arm of the Defense Department, the report depicts a future in which supply chains for U.S. military equipment and services are increasingly owned by Chinese companies. It said that 10% of Chinese venture investing recently went into U.S. tech companies, adding that this was "only a piece of a larger story of massive technology transfer from the U.S. to China which has been ongoing for decades."
DIUx, established to repair the frayed relations between the Pentagon and Silicon Valley in the wake of the Edward Snowden revelations, warned in the study that too many U.S. innovations in dual-use technology were being shared with Chinese companies. It noted that many of the breakthroughs behind the "third offset" -- the Pentagon's term for the next generation of weaponry and military technology -- are being driven by small, private-sector companies.
"The technologies which will create the third offset are being developed by early stage technology companies with large commercial markets," the report said. "If we allow China access ... then not only may we lose our technological superiority, but we may even be facilitating China's technological superiority."
Chinese companies have certainly been active in the U.S. high-tech industry. Daniel Slane, a member of the U.S.-China Economic and Security Review Commission, has raised concerns that companies involved in the American optoelectronics industry -- vital for sensors that help make autonomous vehicles safer -- are beginning to move to China. Haiyin Capital, a Chinese venture firm, took a small stake in Neurala, a Boston-based AI company with contracts from NASA and the U.S. Air Force, prompting alarm among some in Congress. And most leading Chinese tech companies, including Baidu; DJI, the world's largest drone maker; Huawei Technologies and Tencent Holdings, maintain research labs on the U.S. West Coast.
Not long ago, it was fair to describe China's tech business as mimicry. But that is no longer the case. It has been years since China simply tried just to reverse-engineer its way up the value chain. Now China is moving beyond piggybacking on others' breakthroughs and is working to create an environment that fosters innovation -- if only selectively.
In the past, research grants were awarded in China on the basis of party loyalty. That policy helped drive out eminent scientists, said the physicist Shoucheng Zhang, who himself left the country to teach at Stanford University. But now grants are more merit-based. One government-sponsored think tank says that it is no longer required to have firewalls -- a major exception in a country where internet access is restricted. Officials in Beijing are beginning to understand that blocking web access is an impediment to leading-edge research, says Xiaodong Wang, director of the National Institute of Biological Sciences in Beijing.
Beijing's progress in dual-use tech is particularly striking when it comes to unmanned vehicles. Kania described some of these vehicles -- with names such as Xiang Long (soar dragon), Li Jian (sharp sword) and Shen Diao (divine eagle) -- as "supersonic stealth vehicles which are on track to expand the PLA's capacity to engage in long-distance precision strikes and could alter the military balance in the region."
China's technological advances, particularly in AI, mean "the PLA may have the potential to mimic, match or even exceed U.S. advances," she said.
Many experts believe this is already happening. China has moved well beyond imitation, which means that there is little the U.S. can do at this point. "They've gone from a phase of making mimic-type systems to really moving to leap ahead in advanced technologies," said Timothy Grayson, president of Fortitude Mission Research, in a congressional appearance.
The world's fastest supercomputer was built in China. The Sunway TaihuLight system has five times the power of its closest U.S. equivalent and is capable of 93 million billion calculations per second. It "was essentially built, not bought," Addison Snell, CEO of market intelligence company Intersect360 Research, told a March congressional hearing on China's Pursuit of Next Frontier Tech. "It was an internal investment at the Chinese national supercomputing centers using almost entirely indigenous technologies to China."
China is also investing heavily to catch up with competitors in robotics. Historically, the main makers of robots include Fanuc of Japan, Swiss maker ABB and Kuka, the German company recently acquired by Guangdong-based Midea Group. Among potential competitors in China is Shanghai Siasun Robot & Automation, which came out of the Chinese Academy of Sciences, according to Henrik Christensen, director of the Contextual Robotics Institute and a professor of computer science at the University of California, San Diego.
One challenge for China's robotics program is access to high-quality precision gears, such as those made by Japanese companies such as Nabtesco, Christensen says.
Ironically, one reason China has made such startling progress is precisely because it has adopted a template that has been neglected in the U.S., where the military has long held close ties with universities and private companies. And while science funding has become a frequent target of budget cuts in the U.S., that is not the case in China.
Another area in which China has made extraordinary progress is in the arcane science of quantum computing, in which vast amounts of calculations occur simultaneously, and in various applications including quantum encryption and radar. "The shift to China for quantum information science isn't the end result of intellectual property theft, espionage or mergers and acquisitions; rather, it reflects the high level support of government, high and consistent levels of funding and a corresponding lack of these forces in Western countries," John Costello, a senior analyst at Flashpoint, said in March.
Among the partnerships helping the Chinese initiative is the Alibaba Quantum Computing Laboratory, a collaboration between Aliyun, the cloud computing arm of Alibaba Group Holding, and the Chinese Academy of Sciences. The new research facility aims to advance the study and applications of quantum theory and develop new platforms for information security, connectivity and computing.
Aliyun has become among the most potentially lucrative units in Alibaba, an outcome of Beijing's preference to work closely with a few companies and help them grow. "The Chinese government seems to prefer a few centralized systems as opposed to enabling technologies to be distributed throughout the economy," Snell testified. "That allows them to control investment and access a little more tightly in contrast to a U.S. model."
It is a relationship that recalls earlier days in the U.S., when DARPA -- the Defense Advanced Research Projects Agency, an arm of the Pentagon -- worked closely with universities such as Stanford and Massachusetts Institute of Technology and research institutes such as Bell Labs. Such collaborations led to breakthrough technologies, including the internet, AI and robotics, speech recognition and GPS systems. But the ties between the Pentagon and the U.S. tech industry have weakened since their peak in the 1970s and 1980s.
The U.S. has been trying to re-establish that sort of productive relationship, an initiative that began under former Defense Secretary Carter. His successor, James Mattis, paid his first visit to Silicon Valley in August -- making him the first Trump cabinet member to do so.
Mattis' trip included a stop at DIUx, the Pentagon's two-year-old innovation hub, which has awarded $100 million in contracts for projects in AI, autonomous machines and space technology. "We will get better at integrating the advances in AI that are being taken here in the Valley into the U.S. military," he said.
If Mattis and the Pentagon succeed in repairing ties with Silicon Valley, the result could be more innovations that make consumers' lives easier. But it could also accelerate an arms race that will usher in a new era of warfare powered by robots, AI and swarming drones.