DID YOU KNOW THAT:

  • China’s ‘ghost towns’: Several newly built cities with modern infrastructure have no residents, which is a result of overly ambitious construction projects.
  • The world’s longest high-speed rail network:  China has more than 40,000 km of high-speed rail, making it the largest such network in the world.
  • Wind turbines: Twenty years ago, a large share of Vestas’ market was in China.  Now, they have almost no presence there and are being overtaken by Chinese competitors
  • Food: In addition to leading in technology, China is the world’s largest producer of tomatoes and rice.
  • Population: India and China together make up around 35 percent of the world’s population.

ABOUT THE RESEARCHER

  • Stine Haakonsson holds a degree in economic geography.
  • Her research areas include global organisation, innovation networks, emerging economies, geopolitics and value chains.
  • She was the only researcher in the ‘Business Forum on Global Risks’, which last year delivered recommendations to the Danish government.
  • She leads social science relations and teaches at the Sino-Danish Center for Research and Education (SDC) in China – a collaboration between Danish universities.
  • Read more about Stine Haakonsson https://www.cbs.dk/en/research/departments-and-centres/department-of-organization/staff/shioa

We can learn from China

We are no longer ahead of China. It is not even a draw. We are in fact falling behind, says CBS researcher – and we need to acknowledge that because we need a change of strategy

06/03/2025

Vi kan lære af Kina

 

“No longer necessarily being the most attractive partner is a new reality for Danish companies, however, globalisation has entered a new phase, where Denmark and Europe in many areas have been caught up by China – and India is right behind us. Originally, we were the ones ahead, building knowledge economies.”

These are the words of Associate Professor Stine Haakonsson, who does research in emerging economies and globalisation at CBS.

Somehow, we also need to support the industries in which we see potential here in Denmark.

- Stine Haakonsson, Associate Professor

China now has the world’s second-largest economy, while India – with its young population – is expected to take third place later this decade.

And earlier this year, the International Monetary Fund (IMF) published a forecast of expected global economic growth over the next five years. India and China top the list as number one and three.

CHINA LEADS IN 37 TEHCNOLOGIES

On top of this, China is already investing more in the green transition than the rest of the world combined, and an analysis by the Critical Technology Tracker finds that China is leading in 37 out of 44 critical technologies. The analysis shows that China leads in areas such as aerospace, energy, environment, biotechnology, artificial intelligence, advanced materials and quantum technology.

The report also concludes that the world’s ten leading research institutions within several of these technologies are based in China and that these institutions produce nine times as many research articles as the next-best country, which is often USA.

“We have been caught off guard and mistakenly seen China as being nothing more than a factory for the West, while we handled the innovation. This is no longer the case, and we must acknowledge this if we want to keep up,” says Stine Haakonsson.

WE NEED TO BUILD NETWORKS

According to Stine Haakonsson, this new reality demands a change in strategy from Danish companies.

They need to build stronger global networks and form partnerships with high-knowledge actors in areas where China and India are particularly strong. At the same time, they should stay closely connected with local players from both countries to operate effectively in those markets.

The CBS researcher also points out that China and India have strong innovation and industrial clusters, where many companies are in the same area – something that brings several advantages, as it encourages learning across businesses.

“In Denmark, we know this from the robotics cluster that has emerged in Odense. It is a global success story,” she says, adding that one area where we might gain an edge is through the experience we are building with our energy islands.

SUCCES THROUGH STRATEGIC CHOICES

“Denmark and the EU need to acknowledge that China has made some very deliberate strategic choices – and followed very much through on them with substantial state support. Somehow, we also need to support the industries in which we see potential here in Denmark, even if that might seem to clash with our usual approach to market competition,” says Stine Haakonsson.

Last year, she was part of the ‘Business Forum on Global Risks’ along with seven business professionals which delivered recommendations for the Danish government’s globalisation strategy for the business community. Among the group’s recommendations were easier access to capital, greater willingness to take risks and a stronger focus on innovation.

And particularly China’s ability to generate new knowledge is an area where we should be extra attentive, the CBS researcher believes. Unlike Europe, China has delivered on many of its ambitions.

They have already outperformed the European automotive industry in the electric vehicle market and are leading in solar panel and battery development. China also seems to be successful at integrating these inventions among the population. For instance, authorities are encouraging citizens to invest in solar panels by offering to buy any surplus energy they generate.

EARLY DEDICATION TO RARE EATH ELEMENTS

China also plays a dominant role in the extraction and processing of rare earth elements, which is a cornerstone of modern technology. The country controls a large share of the global supply chain for these minerals, which gives a strategic edge in global trade negotiations.

The strategic decision meant that China had to build up their knowledge of geology.’

Stine Haakonsson, Associate Professor

This dominance is the result of a targeted strategy, where the Chinese government already began prioritising rare earth metal production back in the 1980s.

“The strategic decision meant that China had to build up their knowledge of geology. They succeeded – and today they can produce permanent magnets and batteries for the benefit of the green transition. So, they are ahead in this area too,” Stine Haakonsson explains.

She visits China several times a year and has just returned from a one-month long research visit to Beijing and Shanghai  – megacities that according to Haakonsson have hardly any traffic noise, as most transport is electric, where driverless taxis and hydrogen buses are in use, and where the Shanghai Foundation Model Innovation Center – a leading incubator for artificial intelligence and advanced AI models – hosts 100 companies.

TIME TO THINK DIFFERENTLY

“It felt like stepping ten or twenty years into the future,” the CBS researcher observes and underlines that China continues to face many challenges. There is still poverty in some rural areas, but from a Western perspective, the biggest issue remains China’s censorship and treatment of minorities.

“As a humanities researcher, I believe this is a serious problem, but in the long run, I do think dialogue is more effective than closing the door on China,” says Stine Haakonsson, who encourages Danish companies to invest in China and build relations with the giant country in the East.

“Global market competition is changing – and Denmark needs to keep up. Now is the time for companies to develop new business models, production systems and supply networks. And now is the time for us to acknowledge that China has become the big brother,” she says.

The page was last edited by: Sekretariat for Ledelse og Kommunikation // 06/03/2025