Generation 40s – 四十世代

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Why the West and Japan should stop preaching to a rising China

South China Morning Post
Comment›Insight & Opinion
2017-07-07

Jean-Pierre Lehmann

Jean-Pierre Lehmann says the imperialist powers of old should acknowledge their own bloody history of plunder and exploitation, and work with Beijing to find a path to a peaceful rise, which so far is unprecedented

This year marks the anniversaries of a number of Asian historical landmarks. July 1 was the 20th anniversary of the handover of sovereignty over Hong Kong from the UK to China. August 8 will mark the 50th anniversary of the Asean declaration, the founding document of the Association of Southeast Asian Nations. This Friday, July 7, marks the 80th anniversary of the Japanese invasion of China, triggering the Pacific war that lasted until Japan’s surrender on September 2, 1945.

July 7 should be a day for reflection. Such was the case on June 6 three years ago, on the occasion of the 70th anniversary of D-Day in Normandy, when the French president François Hollande hosted, among others, US president Barack Obama, Britain’s David Cameron, Canada’s Stephen Harper, Germany’s Angela Merkel and Russia’s Vladimir Putin. This was one further indication that, while there are tensions in the Atlantic, the breakout of war, as occurred twice last century, is extremely unlikely.

Over the decades since the end of the second world war, there has been a great deal of dialogue, confidence-building and the establishment of solid institutions. Germany, for all the atrocities it committed, has been an exemplary European citizen and is arguably the Atlantic’s greatest guarantor of peace, just as it has proffered unconditional apologies.

Just as Germany has been the solution for peace in the Atlantic, Japan remains a critical problem for peace in the Pacific. In light of the composition and conduct of the Japanese government – with, inter alia, the Defence Minister Tomomi Inada paying regular visits to the Yasukuni Shrine, a sort of mausoleum for Japanese war criminals – it is highly unlikely that there will be reflection, let alone apology.

The Pacific war and its many ramifications tend to be ignored in Japanese education and public discourse generally. July 7 will not be marked by public forums among Japanese leaders, let alone with their Chinese, Korean, Singaporean or Filipino counterparts.

Instead, we hear of Japanese kindergartens spreading anti-Chinese and anti-Korean xenophobic messages and hotel chain proprietors (Toshio Motoya of APA) distributing in all rooms copies of his writings in which he denies the Nanking massacre occurred and claims that the Korean “comfort women” were not sexual slaves but prostitutes.

But the lessons from July 7, 1937 extend beyond Japan. The 21st century is witnessing the rise of another great global power: China. Though there has been a good deal of debate among Chinese intellectuals on the implications of great power rise, illustrated in the seminal 2005 article by Zheng Bijian (鄭必堅), “China’s Peaceful Rise to Great Power Status”, there has been little reflection among the other great powers on how they might contribute.

If one looks at, for example, the current membership of the G7, all the countries, with the sole exception of Canada, achieved great power status through war, conquest, plunder, imperialism, exploitation, enslavement, and so on. Thus, while Japan is a major problem for peace in the Pacific, its warmongering corresponded to a pattern set by other G7 members, including the US, Britain, France, Germany and Italy – and indeed by others including the Netherlands, Belgium and Russia.

While it has become seemingly pervasive for the Western powers and Japan to mount their high moral horses and admonish China that it should “play by the rules”, they fail to explain why at the time of their rise to great power there were no rules or, if there were, they were egregiously flouted.

Thus, the eloquent 1839 letter by the Canton commissioner Lin Zexu (林則徐) to Queen Victoria, imploring her to stop her subjects from forcefully infesting China with opium, was contemptuously ignored. Throughout the 19th and most of the 20th centuries, the “great” powers plundered the planet, including of course China. What rules were the British and French playing by as they pillaged the Beijing Summer Palace in 1860?

Nor is the behaviour of the Western powers just ancient history. American atrocities perpetrated against Vietnamese and Laotians continued into the third quarter of last century. As depicted in the excellent book by Viet Thanh Nguyen, Nothing Ever Dies: Vietnam and the Memory of War, in fact the US has been pretty much continuously at war throughout the second half of the 20th century and most recently in the 21st, with the 2003 invasion of Iraq.

One of the most compelling recent publications on the rise of China is by Geoff Dyer, The Contest of the Century: The New Era of Competition with China, in which he draws compelling parallels between the rise of the US as a great power in the late 19th and early 20th centuries – manifest destiny, the Spanish-American war of 1898-99, resulting in the colonisation of the Philippines, and so on – and the rise of China in the late 20th and early 21st centuries. The 1823 Monroe Doctrine, seeking to establish a US exclusive sphere of influence over Latin American, ultimately came to concrete fruition a few decades later with, among other things, the metamorphosis of the Caribbean as an “American lake”. This, Dyer suggests, is comparable to what China is aiming to do vis-à-vis Southeast Asia generally and the South China Sea [9] in particular – that is, that it should become a Chinese lake.

The argument that these were different times with different parameters does not wash. The main difference from a Chinese viewpoint was that, whereas then the Western powers and Japan were extremely strong and China was extremely weak, today, the Western powers, the US in particular, remain strong while China is no longer weak. Thus, in seeking to draw inspiration from the methods and achievements of great powers rising, what models are there other than the Western and Japanese imperialist nations? There is no precedent for peaceful rise.

This should not, of course, imply that while previous great powers looted and engaged in outrageous brutality, it is now “China’s turn”. But it strongly suggests that serious and honest reflection is called for, not only on the part of the Japanese, but also on the part of the other great powers, and on that basis to engage in genuine dialogue – not sermons – with China. Instead of getting on their moral high horses, sermonising from the alleged position of liberal values, far more constructive would be to admit – and eventually apologise – that in fact they behaved often abominably, feeling bound by no rules except that might is right.

This would seem the only viable means to engage China in its rise to great power, to contribute constructively to the unprecedented peaceful rise, and thereby to have some hope that peace may reign. Finally, after centuries of warfare, one could hope that great power bellicose rivalry might be relegated to the dustbin of history.

Jean-Pierre Lehmann is emeritus professor at IMD, founder of The Evian Group, and visiting professor at the University of Hong Kong


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The Asian financial crisis teaches the need for bold reform, but is China listening?

South China Morning Post
Comment›Insight & Opinion
2017-07-03

William Pesek

William Pesek says regional economies that appear to have recovered from the crash are struggling with structural problems and stagnating incomes, as policymakers baulk at needed reforms. Beijing, now facing similar risks, should take note

My favourite Asian crisis story involves Robert Rubin, an elevator and a pile of cash.

It was September 1997, and I’d just exchanged US dollars in our Jakarta hotel lobby. I was taken aback, and vaguely embarrassed, by the huge stack of rupiah I received – all with colourful money wrappers. In the elevator, I ran into then US Treasury secretary Rubin and one of his top lieutenants, Timothy Geithner. I was among a handful of Washington journalists accompanying them around Asia. Rubin looked at my loot and deadpanned: “I see you found time for a drug deal.”

That was 2½ months after Bangkok’s July 2, 1997 devaluation set Asia’s reckoning in motion. The good news, 20 years on, is that the Thai, Indonesian and South Korean currencies recovered and reserves were restocked. Banking systems were strengthened and economies made more transparent. Capital accounts were loosened and market regulation tightened. Wages bounced back, too. The bad news: income gains have largely stalled in recent years. Is the real legacy of that regional crisis a regional middle-income trap?

That’s when per capita income tops out at, or below, the US$10,000 mark, as it has for Thailand (about US$6,000), Indonesia (US$4,000) and even economies that technically avoided the worst of the crisis – including Malaysia and, perhaps, the Philippines. And while South Korea is the top of the income class – and a proud escapee of the middle-income category – it’s since been ensnared in a higher-income net.

What went wrong? In the immediate years after 1997, technocrats in Thailand, Indonesia and Korea implemented the International Monetary Fund’s reform playbook to modernise financial systems. Strong US demand did the rest, enabling Bangkok, Jakarta and Seoul to export their way back to 5 per-cent-plus growth. But the return of rapid gross domestic product growth deadened the urgency to do the real heavy lifting; weaning economies off exports; building credible institutions; increasing productivity and innovation; diversifying trade links; eradicating corruption; devising better energy strategies; and separating the public and private sectors.

Blame the “Cult of GDP”, something to which Asian leaders have long been susceptible. When heady growth returns, policymakers declare victory, pop the champagne corks and shelve painful upgrades. In the two decades since 1997, Asia’s crisis victims revelled in buoyant equity markets, claimed economies had decoupled from the West and toasted the tidal wave of bankers abandoning New York and London and relocating to Hong Kong and Singapore. And besides, China’s boom would keep the good times going. The cost of leaders believing their own press was slower wage gains. Asia is learning the hard way that “boosterism” is no replacement for economic retooling.

A large painting depicting the late Thai King, Bhumibol Adulyadej, is seen outside the Bangkok Art and Culture Centre last month. Thailand has experienced two coups as a succession of leaders failed to spread the benefits of growth. Photo: EPA
A large painting depicting the late Thai King, Bhumibol Adulyadej, is seen outside the Bangkok Art and Culture Centre last month. Thailand has experienced two coups as a succession of leaders failed to spread the benefits of growth. Photo: EPA

Thailand has experienced two coups as a succession of leaders failed to spread the benefits of growth and get the state out of the financial system (it has been in the hands of a military junta since May 2014). Indonesian incomes are stagnating as reform fatigue and parochial squabbles – over everything from access to natural resources to openness to foreign trade and religion – distract Jakarta. Progress stalled in Malaysia as scandal-plagued Prime Minister Najib Razak clings to affirmative-action policies benefiting ethnic Malays at the expense of competitiveness. In the Philippines, too, Rodrigo Duterte is putting a bloody war against drug pushers and users ahead of raising Manila’s economic game.

Korea beat the middle-income trap, but it’s now ensnared in a higher-income funk. Seoul’s failure to reduce the role of the family-owned conglomerates towering over all corners of the economy and catalyse a start-up boom has average incomes stuck near US$27,000.

Similar criticism could be hurled at Hong Kong, as it commemorates the 20th anniversary of its return to China. While per capita income is 11 times Indonesia’s, Hong Kong hasn’t expanded its growth engines beyond finance and overpriced property. The cost: exploding inequality that’s delegitimising the city’s Beijing-picked leadership and feeding combustible social tensions.

Bold structural changes are always easier when crashing currencies leave leaders no choice. Unless Asian governments relocate some of that 1997 urgency, they will rely more on debt to fuel growth than entrepreneurship and higher productivity. Little good would come of that. That’s Thailand’s big challenge as Prime Minister Prayuth Chan-ocha tries to find his reformist mojo. It’s Joko Widodo’s problem in Jakarta as he struggles to take on vested interests working to regain power over the government. It’s also President Moon Jae-in [4]’s task in Seoul as he deals with a fresh bubble in household debt and rampant corruption.

And what of China? Few questions matter more than whether mainland incomes can reach US$10,000, and beyond. Never before has global stability been so dependent on such an opaque, unbalanced and developing economy. China “definitely has the potential to further catch up with the high-income countries and avoid [getting trapped]”, write Asian Development Bank economists Linda Glawe and Helmut Wagner. “However, the future performance of China’s economy depends on further reforms.” Those changes include altering a debt structure not unlike that of Thailand and other Asian governments, circa 1997.

For most, Asia’s collapse was just as unexpected as Wall Street’s 11 years later. China’s growth engines, it’s worth noting, are tantalisingly familiar: explosions in debt, credit and unproductive investments; chronic overcapacity; quantity of growth trumping quality; a sprawling shadow-banking machine; surging non-performing-loan ratios; policymakers drawing down currency reserves; regulators prodding domestic companies to go public before their time; and complacency among markets about how fast things could go awry. Beijing is treating the symptoms of its excess, not the root causes, in ways that are feeding ever-bigger bubbles. What’s more, US President Donald Trump’s threatened trade war is an ever-present threat to Asia.

Beijing, in other words, must do better than the class of 1997 in learning from past mistakes and preparing for future prosperity. Economic reform, remember, has something in common with the elevator in which I bumped into Rubin 20 years ago: it has the power to lift populations to new heights or leave them on the ground floor. Asia must work harder to ensure incomes regain an upward trajectory.

William Pesek is a Tokyo-based journalist and the author of Japanization: What the World Can Learn from Japan’s Lost Decades.


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從刻舟求劍到逆水行舟

明報
觀點
2017-07-03
馬嶽:

 

2017年6月,香港人被各種「回歸20年」的討論和回顧淹沒。我個人對這種年結式/十年結式的「回顧」一直興趣不大。我總覺得年月是時間的單位,從社會科學的角度,和社會變遷沒有因果關係,於是20年不見得比19年或21年更值得反省回顧,12月也不應比11月更有回顧價值。很多社會變遷都是持續性的,用「齊頭」的數字作結不見得是最好的框架。用文件或文字來規定社會在某段時間的變遷,像「50年不變」,本身就是不科學的。

多年來最重要的變遷是什麼?

這篇文章的截稿恰好定在6月30日,好像是某種命定要寫點和「回歸20年」有關的東西。這段日子給人問了很多相關問題,令我不禁想:這許多年來最重要的變遷是什麼?

一直以來,一國兩制的最深層次矛盾,是中港在政治價值上的差距,或者說是中國共產黨領導和港人主流在政治價值上的差距。我會問:二三十年來,這差距拉近了麼?

一國兩制基本構想上着眼的「兩制」差異,最初當然是經濟性的(「兩制」是社會主義和資本主義)。中國內地和香港最大的差異在經濟制度、生產力、發展水平和生活水平上,而原有法制、司法獨立和法治、各種人權和自由,是香港經濟制度重要的政治配件。在一國兩制原構想下,這些政治價值和制度上的差異,都可以在民族主義(「一國」)的大前提下包容。

「50年不變」的假設是,香港的生產力和制度都較先進,但假以時日中國內地在經濟發展、生產力和生活水平會追近香港,差異會因而拉近,可能50年後不需要再一國兩制。這個分析方法,當然是「很馬克思主義式」的。

網絡社會來臨和新身分政治興起

但人類是很難預測社會的長遠變化的。近二三十年世界社會的最大變化之一,用Castells的說法,是網絡社會的來臨和新的身分政治的興起。經濟變遷如後工業化、全球化和網絡力量,加上冷戰結束,令世界各地人民找尋新的身分,令民族國家(nation-state)的影響力下降、人民追求自主自由參與、抵抗父權,各種身分政治的運動應運而生(包括環保、性小眾、各種地域自主的運動等,當然也有向宗教原教旨主義和排外族群主義進發的)。

香港人尤其年輕一代緊貼全球化的趨勢,隨着踏進後現代和網絡社會,走向崇尚自由、自治、自主、後物質主義和平等價值,思考新的身分認同,認同各種後現代的運動,是自然不過的事。

世上不少先進國家面對網絡社會和新身分運動的挑戰,走向權力下放、尊重及回應地方自治的訴求、領導層年輕化、快速回應民意、加強施政的問責性;對各種後現代的運動訴求,例如環保和同性婚姻,也要加倍重視和積極回應。

但我們看中國官員對香港的話語和其盛載的價值,到了2017年卻仍然非常「前現代」。例如經常仍然用冷戰思維看問題:反抗運動都是「西方亡我之心不死」的結果。例如香港年輕人的問題是經濟問題、是不能上流和買房子的問題,對策是給更多經濟援助;「人心不回歸」就加強由上而下的教育,再多加些課時或者從幼稚園開始,例如強調國族主義和民族國家的必要,希望不斷強化國家功能來控制公民社會和民間自主。衡量一國兩制成功的標準永遠是「繁榮」和「安定」,永遠是經濟增長、建設和競爭力,不去問生活在其中的港人是否覺得自由快樂。面對政制民主化的要求,就祭出「國家安全」和「穩定」的大旗。回歸廿年滿街紅旗水馬,滿紙像是工業化初始階段的話語和口號,和香港近年的政治價值走向背道而馳,差距像不止一個世代,真的是「恍如隔世」。

二三十年前,中國政府還會比較虛心地承認香港問題他們不大懂,香港有很多先進的制度特質中國內地需要學習(例如法治、科學管理方法、公務員制度、廉政等等),於是《基本法》會加進不少制度限制,為防止內地影響香港建立一些「防火牆」。今天的中國自居「天朝」,信心滿滿地覺得「中國模式」可以垂範天下,變成了張浚生來教導香港人什麼叫法治、你們不懂管治香港我們來教你。這變成把「中國模式」看成最普遍優越的制度,覺得遠在「天朝國都」的人比香港人更了解香港管治,也不見得有什麼知識根據了。

20年「舟已行矣而劍不行」

10多年前,我就用過《呂氏春秋》中的「刻舟求劍」比喻來說香港的政治發展:「楚人有涉江者,其劍自舟中墜於水,遽契其舟曰:『是吾劍之所從墜也。』舟止,從其所契者入水求之。舟已行矣,而劍不行, 求劍若此,不亦惑乎?以故法為其國與此同。時已徙矣,而法不徙,以此為治,豈不難哉?」

這本來說的是,如果政治價值已經大變,但政制十多廿年都不變,是沒有能力回應新一代的政治訴求的。二三十年前,香港人還可以接受「安定繁榮」的話語,因為當年政治文化還很保守,殖民地的不民主體制邏輯八九十年代勉強還是可以管治的。20年都沒有與時並進,改革政制來跟上人民價值的轉變,就是「舟已行矣,而劍不行」了。

中國官員連與時並進的欲望也沒有

在2017年的今天看來,這個看法竟然還是太樂觀了。劍墜在水底,通常是不會動的。中港的政治價值鴻溝,卻可能是愈來愈闊。二三十年來中國內地的生產力和發展水平當然是大大追上香港,但政治價值差異卻沒有隨之拉近。當香港人的政治價值已經急速地隨着全球化和進入網絡世代而邁進後現代、後物質和新身分政治,中國官員仍然用一大堆工業化初始的概念看世界看香港,不單政治觀念沒有現代化,連與時並進的欲望也沒有了。河底有暗流,劍好像愈來愈遠了。

延伸閱讀:Manuel Castells, The Power of Identity(West Sussex: Wiley-Blackwell, 2010)


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Why Hong Kong’s property market won’t crash – this time

CommentInsight & Opinion
2017-06-29
Andy Xie says although Hong Kong’s fragile economy remains unhealthily dependent on the property sector, the asset bubble today is unlikely to burst, as happened after the handover. Stagnation is the bigger worry

 

Property is at the centre of everything in Hong Kong today, much like it was 20 years ago on the eve of the handover. Soon after the handover, prices collapsed, hitting rock bottom in the spring of 2003. They have since clawed their way back up, and some. With the 20th anniversary of the handover now upon us, will history repeat itself?

The similarities between now and then are only skin deep. In 1997, Hongkongers were extremely optimistic about the future. Foreigners agreed. The mantra was that China was set for explosive growth, Hong Kong, being China’s window, would be the conduit for all the money flowing to the mainland, and Hong Kong property would rise and rise on that money. Most bubbles occur because people got carried away. Hong Kong in 1997 fell into that category.

When the Thai baht collapsed, it exposed the problems in the East Asian boom. When foreign money pulled out, the Hong Kong property market collapsed. It showed that hot money was the driver for Hong Kong’s property market, not growth.

The collapse of the bubble exposed a greater challenge facing Hong Kong’s economy. The city prospered on China being closed. Arbitraging on China’s inefficiencies was the foundation of Hong Kong’s prosperity – being in Hong Kong offered a seat on the gravy train. The Hong Kong government taxed the privilege through high property prices to fund itself.

But, after China joined the World Trade Organisation, the gravy train was derailed.

Hong Kong has never faced up to this competitive challenge. For years, mainland tourism kept the retail sector afloat. But, is the future for Hong Kong youth to be shopkeepers?

Meanwhile, investment immigration juiced up the property market. It turned a whole generation of youth into property agents harassing pedestrians in the posh shopping districts. The latest financial boom is very much driven by grey income fleeing China. After 20 years, Hong Kong’s economy hasn’t built a lasting foundation.

This economic fragility is reflected in the popular pessimism today, in contrast to the widespread optimism two decades ago. Why, then, is there a property bubble now?

Three forces have been at work.

First, after the property collapse in the late 1990s, the city’s ruling class shrank supply to prop up prices. The initial plan to launch 85,000 public flats, a key component of Tung Chee-hwa’s housing programme, was abolished. Minimum prices were assigned to subsequent land auctions, cutting supply in a low-price environment. Even the land marked for public housing was later sold to private developers. When incomes are not rising, cutting supply can increase prices.

Second, after the 2008 property collapse in the US, the Fed cut interest rates to zero and kept them there for a long time. With an exchange rate pegged to the US dollar, Hong Kong has the same interest rate, and debt demand increased accordingly. Household debt has increased to 70 per cent of gross domestic product from the previous peak of 50 per cent in 1997. The debt, of course, has piled into the property market.

Lastly, China saw a massive increase in corruption in the decade after 2002. The grey income flooded into Hong Kong, much of it enabling cash purchases of properties. The flood of mainland money, in addition to juicing up property demand, has kept Hong Kong’s interest rates even lower than America’s.

However, all three forces are now reversing. Housing supply is likely to increase substantially in the coming years. Though still low relative to the population, the increase will have a big impact, because the prices are so high relative to income. US interest rates are going up. And, China’s crackdown on corruption will last for years to come.

Hong Kong’s property market is likely to behave like Japan’s in the past two decades, not like it did itself two decades ago. The US economy is not as strong today as it was then, and US interest rates may peak at 3 per cent this time, not like the 6 per cent then. Besides, China is much bigger now and will surely intervene if the market collapses like in 1998.

After its property bubble burst in 1992, Japan’s banks didn’t foreclose on their delinquent borrowers. That prevented the snowball effect in a bubble collapse. However, while such a response would save the economy the pain of a 1998-style collapse, the slow adjustment would trap the economy in stagnation, because capital could not be relocated into new productive areas from the bubble economy.

Hong Kong has been trapped in a property curse, which could last another two decades, diverting its attention from the main challenge of meeting the competition from millions of graduates from across the border joining the workforce each year.

Two decades ago, for a similar job, a Hong Kong salary was 20 times that on the mainland. Now it is three times. How long can Hong Kong justify the differential? It is already less competitive in education and infrastructure than tier-one mainland cities. The gap will only widen. Unless big changes are made, salaries in Hong Kong will not rise and may even decline.

Andy Xie is an independent economist


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Inside the AI revolution that’s reshaping Chinese society

NewsChinaSociety
2017-06-29
Artificial intelligence, once a novelty, is now being applied in everyday life. From academia to business, government and the military, ambitious China is betting big on AI, raising US suspicions yet offering opportunities for collaboration

Seven-year-old Chen Jiahao has a problem sum he can’t solve and he can’t wait to get home from school to pose the question to his all-knowing maths tutor.

His tutor is amazing, the boy says. Just snap a photograph of the question and the tutor will provide every possible approach to solve the problem, step by step – all in a split second.

Jiahao’s tutor is inside his mother’s smartphone. It is, in fact, an app that draws on artificial intelligence (AI) technology to solve challenging maths problems for primary school children.

And it’s just one of many AI-enabled apps Jiahao uses daily on his mother’s phone. When the boy started primary school in Beijing, his teachers recommended that his parents install the apps on their phones. The software give out school assignments, grade pupils’ work and even generate unique sets of exercises for each child based on their areas of weakness.

“Jiahao likes his AI teachers,” said his mother, Yu Ting, adding that her son spends at least two hours on the AI apps every day. “He greets my phone as eagerly as he greets me.”

AI society

Jiahao’s story shows how AI is shaping modern Chinese society as the technology shifts slowly but surely from the realm of mere novelty towards common, everyday application.

On Chinese social media, video-sharing platforms and shopping sites, AI technology is already widely used to cater specifically to individual tastes and preferences.

For example, online news aggregator Toutiao provides a selection of articles tailored for its users based on information such as their age, gender and location. Video-streaming website iQiyi recommends programmes based on users’ search and viewing history.

Ali Xiaomi, the AI-powered customer service chatbot of tech giant Alibaba, which owns the South China Morning Post, can reply to a million text queries and takes thousands of phone calls from online shoppers every day. The use of AI has cut e-shops’ customer service costs by 90 per cent, according to Alibaba.

That’s not all. An AI traffic controller introduced on trial in Hangzhou in Zhejiang province last year eased vehicle flow on roads, allowing cars to pass at speeds of up to 11 per cent faster than usual, state-owned broadcaster China Radio International reported.

A missing man from Fujian province was reunited with his parents thanks to AI analysis of facial recognition data. Photo: Handout

In April, search giant Baidu’s AI system reunited a couple in Chongqing with their long-lost son. The machine analysed a photograph of the six-year-old boy, who went missing 27 years ago, and matched it to the face of a 33-year-old man in Fujian province, the Beijing Evening News reported. DNA tests confirmed the match.

What, exactly, is AI?

Popular culture, especially in the West, often either romanticises the notion of artificial intelligence – such as in the 2013 Hollywood film Her, in which a lonely man falls for his “female” AI operating system – or portrays it negatively, as in the hit US television series Westworld, where oppressed androids in an AI theme park turn murderous against their abusive human guests.

In reality, AI technology – at least in its current stage – is both less romantic and frightening, but its possibilities may be every bit as boundless as imagined in the movies.

AI refers to a computer software that mimics intelligent human behaviour. Creating such intelligent systems requires teaching machines to learn for themselves – an application of AI known as machine learning – rather than manually teaching them everything there is to know.

Machine learning involves feeding computer systems with large volumes of data and programming the systems to interpret the information for themselves through pattern recognition. The machines hence “learn” by calculating probabilities and drawing conclusions from patterns found in the data at its disposal.

A powerful form of machine learning is deep learning, which categorises information according to hierarchical layers of concepts. The arrangement allows systems to interpret complex data with greater flexibility, speed and accuracy.

“AI is like a child,” said Professor Feng Jufu, a machine learning scientist at Peking University’s school of electronics engineering and computer science. “The more people use it, the faster it learns. The more it learns, the faster it improves.”

United States’ rising rival

China, whose population of 1.38 billion people makes it the world’s biggest user base and data pool, is a “paradise” for machine learning technology, Feng said.

And the nation – from its computer scientists, tech businesses, the government and military – is exercising its competitive advantage.

For decades, AI initiatives have been launched and developed in the United States and the field dominated by American experts. But now, the balance appears to be tipping as China’s AI technology comes up neck and neck with that of the US.

There was no clearer demonstration of this shift than what occurred at the annual meeting of the world’s biggest AI research community this year.

The Association for the Advancement of Artificial Intelligence rescheduled its yearly event in New Orleans, originally set in January, to the following month after finding out that the dates conflicted with China’s Lunar New Year holiday, The Atlantic magazine reported.

“Our organisation had to almost turn on a dime and change the conference venue to hold it a week later,” the association’s president Subbarao Kambhampati was quoted as saying.

The clash might not have mattered in the past, but with Chinese scientists now producing more research papers on deep learning than Americans, the meeting would have been pointless if the Chinese could not attend, according to the association.

An artificial intelligence backed by face recognition function which can used in mobile payment is demonstrated in Wuhen on Nov. 16, 2016. Photo: Simon Song

“The race is tight,” said Li Xiaowei, executive director of the Chinese Academy of Sciences’ State Key Laboratory of Computer Architecture in Beijing. China has only one main competitor – the US – and its goal was to beat its rival on the other side of the Pacific, he added.

Li said he and colleagues were developing computer chips, built specifically for machine learning, that would significantly boost the speed of an AI system, running “as fast as a car against a bicycle” compared with existing AI machines on traditional CPUs.

Chinese researchers have already developed AI chips with faster performance on specific tasks such as image recognition and natural language processing, but they still consumed more energy and tended to be less reliable than American-made chips, Li admitted.

Chinese ambitions

While US experts are still making most of the fundamental AI breakthroughs, this may soon change as Chinese tech giants like Baidu, Alibaba and Tencent, with access to the vast amounts of data needed for AI training through their millions of customers, inject massive investment into the technology, setting up their own AI research laboratories to create new products at a speed and scale never before seen in the West.

China was the world’s second biggest investor in AI enterprises last year, injecting US$2.6 billion into the sector, according to Chinese think tank the Wuzhen Institute. The US topped the list with US$17.9 billion.

Smaller firms aren’t passing up the chance to make a foray into AI either. This month, AI robots owned by two Chinese education-tech companies sat the maths section of the nation’s notoriously difficult college examinations.

Press gathered in Chengdu earlier this month as a robot sat the maths test for the national college entrance exam. Photo: Xinhua

One, which took the test in an isolated room at a technology park in Chengdu in Sichuan province, scored 70 per cent, spending about 20 minutes completing the questions. The other, which sat the test in Beijing and was connected to the internet, scored 90 per cent in less than 10 minutes. The second bot’s score was good enough to gain admission into China’s top universities.

“Artificial intelligence has undergone several waves of hype over the past decades, but this time it’s different. This time, it may really come alive,” said Feng, the Peking University academic.

Over in the public sector, the Chinese government has pinpointed AI as a key area for advancement in its latest five-year plan. Top technology official Wan Gang said in March a national development plan was being drafted that would see AI technology adopted in areas including “the economy, social welfare, environmental protection and national security”.

Last year, the Chinese government said it would create an AI market worth more than US$15 billion by 2018. Beijing has already sunk millions into studying AI in universities and research institutes around the nation. It is also already applying the technology across the full spectrum of governance.

Traffic authorities in the city of Jiaxing in Zhejiang province this month began using an AI coach in a driving school. The system monitors students’ driving behaviour and detects mistakes they make, instructing them through a speaker and rating their performance, the Jiaxing Daily reported. The passing rate of students who learned with the AI coach was 20 per cent higher than those who had human coaches.

Over in China’s most innovative city of Shenzhen in Guangdong province, the use of a tiny chip in public surveillance cameras has helped police crack hundreds of cases and find several lost children. The intelligent chip whittles down the speed of human facial recognition to just a few seconds.

And in Jiangsu province’s city of Nantong, an AI judge will be put into use later this year to organise and analyse legal documents and material as well as perform paper work to lighten the workload for human judges. The system is expected to speed up the handling of legal cases by 30 per cent, the Nantong Daily reported.

US suspicions (and collaboration)

China has also ventured into AI on the military front. The nation is developing cruise missiles with “a very high level of artificial intelligence and automation”, the China Daily quoted a senior missile designer as saying last August.

As the country’s AI capabilities grow, so have US suspicions. The Pentagon had concerns about Beijing’s access to US-developed AI technology, the Reuters news agency reported this month.

Citing a leaked document, the report said the US defence department recommended blocking Chinese organisations from investing in some American start-ups working on cutting-edge technologies. The report suggested Washington fears that its advanced algorithms might be re-purposed for Chinese military use.

Individual Chinese AI researchers might also have become a concern for the US government, according to Zhang Lijun, an associate professor of computer science with Nanjing University’s learning and mining from data group in Jiangsu province.

“Each time we go to the US for an academic conference, we encounter extensive background checks by the US embassy,” Zhang said. But if the US stopped issuing visas to Chinese AI scientists, the move would do as much damage to America as it would to China, he added.

Despite Washington’s concerns, American companies are still flocking to join hands with their Chinese counterparts in AI research given the sheer amount of funds injected into the industry. And the collaborations have seen considerable progress in the field.

In May, Google’s AlphaGo AI programme – developed to play the Chinese board game Go – defeated world champion Ke Jie in a series of three matches, all of which the machine won.

The strategy game, played on a 19×19 grid board with more permutations than the estimated number of atoms in the observable universe, was previously believed too sophisticated for the machine to handle. Scientists had predicted AI would take at least a decade to decisively conquer the game; the final match took less than four hours.

The same month, Microsoft’s Chinese-language chatbot Xiaoice published the world’s first collection of AI-authored poems in a book titled The Sunlight That Lost The Glass Window. The book caused a stir among China’s literary circle, with some poets hoping the technology would revive appreciation of the art. Pirated copies have already appeared on Chinese websites, reflecting interest in the book.

“The US is good at coming up with new ideas in fundamental research while China is good at implementing these ideas in applications. International collaboration has played a key role in the rapid development of AI technology in recent years,” Zhang at Nanjing University said.

The future

All these advancements are just the beginning of an AI revolution, according to the Peking University academic Feng.

“The only limit is your imagination,” he said, adding that AI technology could have even broader and deeper applications in people’s lives.

The Chinese Academy of Sciences’ expert Li concurred. The AI user experience of the future would be vastly different from today, as with software and hardware upgrades newer AI machines would become far faster and more human-like.

The collection of AI written poems, The Sunlight That Lost The Glass Window. Photo: Handout

For instance, Feng said, today’s exam taking robot could be developed into an exam-setting machine. Like AlphaGo considered permutations never conceived by human players in the past, the AI system could pose students challenging questions that would push them to achieve results beyond what they thought possible.

“If you can answer maths questions designed by machines, you should then be able to easily tackle questions designed by humans,” he said.

But Professor Li Qingan, an educational psychologist at Beijing Normal University, cautioned against the unregulated use of AI in schools.

“Artificial intelligence may create super students, but it can also turn them into cold-blooded creatures with little care for how others think and feel,” Li said. “Thirty years from now, we may regret giving our children over to AI.”

There is also a limit to AI systems, according to professor Huang Biqing, a robotics scientist with Tsinghua University.

“If human-generated data can no longer improve an AI system’s performance, the machine will treat it as noise,” Huang said, adding that this meant the system would regard human input as no longer necessary and could evolve based on its own machine-generated data.

Chen Yi, the father of Jiahao the primary schoolboy who loves his AI tutors, recalls his childhood addiction to Nintendo’s Game Boy as he observes his son interacting with the apps on his wife’s smartphone.

“This is different from my childhood addiction,” Chen said, referring to Jiahao’s attachment to the AI-enabled programmes. “Jiahao’s condition is more like, I don’t know, a kind of dependence?”