For decades, China’s rise as an industrial and technological power was built on learning from the West. It absorbed Western technology (and was often accused of stealing it), and used the country’s vast market to accelerate domestic capabilities. American, European and Japanese firms entered China with capital, technology and expertise. Chinese companies emerged from those partnerships stronger, more sophisticated and increasingly capable of competing globally. Now, as China has become a leading force in fields such as artificial intelligence (AI), semiconductors, electric vehicles and green technology, Beijing is rewriting the rules. The new outbound investment regulations that took effect on July 1, 2026 indicate a big turn from technology absorption to technology protection.
The old model: Technology for market access
