The United States must closely monitor China's rapidly expanding quantum technology ecosystem, which benefits from significant state backing and could alter the global competitive landscape, according to experts at the Special Competitive Studies Project (SCSP). Quantum technology, which leverages the physics of subatomic particles, promises to revolutionize computing, communications, and security. Potential applications include quantum navigation systems that reduce GPS vulnerabilities, secure quantum networks for information transfer, and quantum computing that accelerates scientific research and optimizes supply chains.
China's quantum ecosystem is characterized by extensive government support, with state-affiliated telecom giants like China Telecom funding a network of quantum startups. Data from Datenna, an intelligence platform, reveals that many of these firms originate from state laboratories or university research groups, maintaining ties to Beijing through funding, ownership, or procurement. For instance, Origin Quantum, a Chinese quantum firm, received support from the Chinese Academy of Sciences and is now preparing for an IPO valued at approximately $1 billion.
Dr. Damien Bérubé, a researcher in Emerging Technology Policy and Quantum Science at SCSP, highlighted that China is creating demand for quantum technology before the market can sustain itself. State-backed customers and government subsidies allow Chinese companies to build up before competing globally. This approach does not immediately threaten U.S. and allied firms in high-end markets, but the experts warn that Chinese suppliers surviving on protected domestic demand will eventually enter foreign markets at lower prices.
"A network map of these contracts should therefore be read less as a list of isolated transactions and more as an industrial policy map: which buyers sustain certain suppliers, which sectors are receiving demand signals, and which firms are being positioned to scale," the experts concluded. The SCSP, a nonprofit and nonpartisan initiative, aims to strengthen America's long-term competitiveness in critical technologies like AI and quantum. The implications of China's strategy underscore the need for the U.S. to foster its own quantum ecosystem through collaboration among technology companies, academic institutions, and government agencies. To learn more about SCSP's analysis, visit scsp.ai.
