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China Aims to Bring Startups Home From Silicon Valley

Beijing’s unslakeable thirst for the latest technology has spurred a proliferation of “accelerators” in Silicon Valley. Many local governments in China – like their counterparts in the United States – are eager to support startups in the name of economic development. The accelerators work with companies in fields including artificial intelligence, autonomous driving technology, big data and health sciences. They often help U.S. companies set up joint ventures or licensing agreements to enter China – the type of deals some U.S. policy hawks have criticized as conduits for transferring intellectual property.There have been no high-profile examples of such theft from companies helped by the Chinese accelerators. But American heavyweights such as Apple, GM and even Michael Jordan have faced fights in China over protecting their intellectual property. Xiao Wang, co-founder of InnoSpring Silicon Valley, a Shanghai-headquartered accelerator that has invested $3.5 billion in 70 U.S. and 15 Chinese startups in the last five years, said those who believe intellectual property theft is the price for entering need “to understand China better.”

For U.S. government officials wary of China’s growing high-tech clout, the accelerator boom reaffirms fears that U.S. technological know-how is being transferred to China through investments, joint ventures or licensing agreements. U.S. universities remain a major training ground for Chinese engineers, for example, and U.S. companies such as Microsoft have long had research laboratories in China. According to the Democratic vice-chairman of the U.S. Senate Intelligence Committee, said in a statement to Reuters about Chinese accelerators. “China’s government has clearly prioritized acquiring as much of that intellectual property as possible. Their ongoing efforts, legal or illegal, pose a risk that we have to look at very seriously.”U.S is considering several measures that could impose sweeping new strictures on Chinese investment in Silicon Valley. President Donald Trump’s crackdown down on visas for foreign tech workers and threats of a trade war with China are also changing the landscape. It is only a matter of time, he said, before people realize that suspicion of Chinese investment is “detrimental for the United States.”

Source : The economic Times

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