News on China's scientific and technological development.

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The security guard's mirrored sunglasses reflect Barcelona's pale winter sunshine. His job is to keep the crowds attending the sprawling trade fair at bay. Behind him, a pavilion the size of a bus garage houses the latest technology produced by China's Huawei. Those without a meeting to attend are told they cannot enter, and cameras are banned inside.

Huawei is China's biggest exporter, and its equipment helps run the BT broadband network, but the brand is unknown to most UK households. Regarded as a secretive organisation even within the people's republic, Huawei is headed by a former Red Army engineer, Ren Zhengfei.

Unlike other Chinese IT firms, such as the PC maker Lenovo and telecoms group ZTE, Huawei is not listed on the Hong Kong stock exchange. A private company owned entirely by its founders and employees, the names of its board members were only published for the first time last year.

But it is also a flagbearer for China's "going out" policy of encouraging the first generation of corporations created by economic liberalisation in the 1980s to compete on the world stage. Entrepreneurial and unbureaucratic, it has prospered without having the state as a shareholder.

It sells everything from mobile mast radios to software, data-centres and laptop dongles. Founded in 1987, Huawei only began exporting in earnest in 2000, but already over 65% of its revenues are from abroad. Last year, they totalled 185.2bn yuan (£18.51bn), just half a billion pounds less than the world's largest telecoms equipment group, Ericsson.

Now Huawei is preparing to step out of the shadows. While its governance remains veiled, the company is pushing its brand to the fore. It wants to place its products in the hands of millions of western consumers, and become the fourth largest manufacturer of smartphones by the end of this year.

At the Mobile World Congress in Barcelona last month, Huawei's devices chairman Richard Yu said that by the end of 2012 he hoped to have sold 60m smartphones, up from 17m last year.

Hitting that target would vault the firm into the big league, behind Apple, Samsung and Nokia, and ahead of BlackBerry maker RIM and Taiwan's HTC. To succeed, it will have to redefine what "Made in China" stands for.

While Huawei's hometown of Shenzhen is the electronics workshop of the world, churning out iPhones for Apple and PCs for Dell, its produce usually bears the stamp of a foreign company. Aside from PC maker Lenovo, it is hard to name a Chinese brand known to European and American shoppers.

"Consumer perception is that a Chinese product is cheap and looks cheap because the quality is no good," says Francisco Jeronimo, an analyst at research firm IDC. "Huawei needs to change that perception."

Jeronimo believes Huawei products have the quality to compete, but says it will need to raise its public profile. The charge will be led from the UK, where no expense has been spared in recruiting British executives and an advisory board to help find friends in high places.

Former Sunday Telegraph editor Patience Wheatcroft is an adviser, as is Amazon's ex-UK boss Brian McBride, and Sir Andrew Cahn, once chief of staff for Neil Kinnock and recently chief executive of UK Trade & Investment, the government trade promotion body. To promote the smartphones, Bartle Bogle Hegarty, ad agency to Google and BA, will create a global campaign from London.

"It's imperative we are seen as a global brand and not a Chinese brand," says Mark Mitchinson, a Samsung veteran running Huawei's UK devices arm.

His newest stock are phones and tablet computers running Google's Android interface, which house computer chips that have four rather than the now usual two processors, allowing them to handle multiple instructions at the same time. They are fast, particularly when it comes to downloading video.

While most phone makers prefer to leave chips to specialists like Intel, Huawei, whose name stands for "China can" and "splendid act", designed its quad core processors in house and has become known in recent years for innovating. Some 62,000 of its 140,000 staff work in research and development, and there are 23 R&D centres around the world.

Without a recognised brand, Huawei's phones will sell on price. Its mission will be to mop up those mobile subscribers who don't yet own a smartphone, rather than trying to poach Apple's customers.With BlackBerry caught napping and now adjusting to a new chief executive, and Nokia yet to prove its adoption of Microsoft's Windows Phone interface can turn business around, Huawei is seizing a window of its own.

"There are certain manufacturers that have dropped the ball over recent years and others can pick up that ball and run with it," says Mitchinson.

Samsung has shown it can be done. The Korean company moved from fifth to second spot globally in smartphone sales last year, the only one in the top five to grow in the face of the unstoppable iPhone.

There are those who wonder why Huawei is so keen to risk its hard-earned yuans by chasing capricious mobile phone customers. The answer is that this is a high-growth market. Even in an early adopter nation like the UK, only half of us have a smartphone. And the handset market has the attraction of being a less politically sensitive one than infrastructure.

Huawei is already big in Europe, having last year won a breakthrough contract to overhaul the network of the UK's largest operator, Everything Everywhere. But an offer to donate £50m of equipment to bring a mobile signal into the London Underground in time for the Olympics was never taken up.


MP Patrick Mercer described the possibility of detonating bombs with phones on trains as "the answer to terrorists' prayers". A spokesman for Huawei says the deal fell apart not because of security fears, but because commercial agreement could not be reached between all the various players involved.

The culture within Huawei is often described as militaristic. Information is shared on a need-to know basis, with one employee complaining anonymously on recruitment website Glassdoor: "Don't expect to get the information or documentation to be able to carry out the job you are employed to do." Others who have worked there, like former UK mobile chief Jeremy Sheehan, says this comes from a desire to "protect client confidentiality".

Bengt Nordström, a strategic adviser to European mobile networks, says Huawei has succeeded because of its ability to learn fast. While Chinese employees even in the UK still put their heads down on their desk for a nap after lunch, managers study for MBAs, and are offered crash courses in Western culture. "Ten years ago they were really only selling on low prices," says Nordström. "It was hard to find people that could speak English well enough to conduct a business discussion. But for every quotation they produced, their quality increased. Customer relations is an area where Ericsson is stronger than any other vendor but Huawei have learnt that game."

Backed by a $30bn credit line from the China Development Bank, the pattern of Huawei's international expansion has followed its philosophy, borrowed from Chairman Mao, of encircling the cities by winning the countryside.

Beginning in Africa and Russia, it has moved successfully west. Only America has blocked its advance. Efforts to expand have been repeatedly neutralised by Washington. Offers to acquire Motorola's wireless division and a broadband software group were quashed after the sellers were informed that regulatory approval would not be forthcoming. A contract to modernise mobile operator Sprint Nextel's network was kyboshed, and the US commerce department last autumn barred Huawei from an emergency services contract. A British executive whose company buys from Huawei says US politicians are using espionage as a scare tactic to protect domestic businesses from foreign competitors.

"You've got to remember the most protectionist country of the developed world is America. Rupert Murdoch had to become American to buy Fox. What the Americans are really trying to do is stop Huawei getting the business they know they could get if they opened up their equipment market to them."

Huawei's stated ambition is to become as big as Cisco or IBM, with annual revenues of $100bn in 10 years. Nordström says this is unlikely without conquering America: "This is an industry where you need to be truly global to have a future."

Observers say the most serious threat to Huawei's ambitions comes from within. As Ren approaches his 68th birthday in October, the company he founded is facing a succession crisis.

In her letter published in last year's annual report, Huawei's charismatic chairwoman, Sun Yafang, thanked the staff for re-electing her, saying: "I am sincerely grateful to our employees' trust and confidence in me." It was a short statement that masked an internal power struggle. While Ren, who does not give interviews, has been criticised in the Chinese press for a lack of transparency, Sun is increasingly being seen as Huawei's public face, a networker who was among corporate China's most senior representatives at Davos this year.

But in October 2010, a report in Meiri Jingi Xinwen (Daily Economic News) suggested Sun had been offered 1bn yuan to leave Huawei so that Ren could prepare the ground for the appointment to the 13-member board of his son, Meng Ping, who is customer relationship management director and is said to have spent time in the US. The company denies this. Whatever the truth, Sun survived in a post she has held since 1999 and Meng did not join the board.

But the Ren dynasty holds sway at Huawei; Ren's daughter Meng Wanzhou is chief financial officer. Meanwhile, Ren Shulu, the founder's younger brother, is a member of the five-strong supervisory board that oversees the directors. Both boards are elected every five years, by 51 staff representatives who are in turn elected by Huawei's 60,000 shareholding staff.

Gary Liu, a professor at the China Europe International Business School in Shanghai, says Ren's determination to find a successor from within his family stems from 2000 when his then second-in-command, Li Yinan, left to start a rival company, Harbour. Ren fought and eventually bought Harbour, but the experience, says Liu, destroyed his trust in non-family members.

Succession is not just an issue at Huawei. China's first generation of entrepreneurs at Lenovo and white goods maker Haier are also nearing retirement. "These companies' futures hinge on how effectively the incumbents manage leadership transitions. Indeed, the choices the founder CEOs make may well reshape their companies as well as the Chinese economy," says Liu.

Ren has resisted a stock exchange listing, but ownership could help shed light on the business and build trust. Huawei may have to open its own doors before America decides to do the same.
 

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The supercomputer in this southern boomtown is named Nebulae for the interstellar clouds of gas that give birth to stars. The machine symbolizes China's soaring ambition to challenge the U.S. and other developed nations in technology, but also underscores the limitations of what China can achieve.

China's unexpected progress in developing supercomputers, the brains of modern science and an engine of economic development, has caused an outbreak of anxiety over the past two years in the U.S., which has long been the field's undisputed leader. China's advances in computing have been critical to its ability to build spacecraft and advanced warplanes and to its growing prowess in genetics. China overtook Japan in 2010 as the number two investor in research and development, according to Battelle Memorial Institute, a Columbus, Ohio, research outfit. Though China remains well behind the U.S. in R&D spending, it is gaining ground.

But a closer look at China's supercomputers reveals a program that is far less of a threat to U.S. technological dominance than commonly believed. Chinese researchers say decisions about how supercomputers are used are often made by local politicians more interested in local development projects than breakthrough technology.

China's bureaucrats meanwhile haven't figured out how to mount software development projects that come close to U.S. or European standards. Chinese scientists also lack the funding, and freedom, to explore technologies that haven't already been endorsed by the government, which can keep them well behind the cutting edge.

The result is that China's supercomputing projects aren't producing the kinds of breakthroughs that can create new industries. It is instead being deployed to help the country simply catch up with the U.S. and Europe, in areas ranging from health care to automotive design to aviation. That is important economically, but it is also a reminder that China remains a developing country whose main goal is to close the economic and technology gaps with richer nations.

"The strategy has been never to lead, but to follow" technologically, said Qian Depei, a Beihang University researcher, who has worked for decades on China's advanced computing programs. "That was the most economically efficient way to develop."


Richard Suttmeier,a University of Oregon expert on Chinese science policy, said China hasn't figured out "the right formula" to pioneer new technologies in part because researchers are rewarded according to the number of academic papers they publish rather than the quality and novelty of their work.

Supercomputers are largely seen in China as local economic-development tools. City governments play a much larger role in setting China's supercomputer research agenda than they do in the U.S. because Chinese cities finance a larger share of the projects.

Shenzhen, which paid three-quarters of the $1.3 billion cost of the Shenzhen supercomputer center, "doesn't care about climate change and astrophysics"—traditional supercomputer research projects—said Feng Shengzhong, deputy director of a Shenzhen research institute that develops applications for the Nebulae. "They care about local problems."

He is working on a plan to use the Nebulae to improve health care services in South China—a socially important goal but not one that makes use of the power of what is ranked as the world's fourth-fastest supercomputer.

China is now home to 74 of the world's 500 fastest supercomputers—which can make trillions of calculations every second—up from just 10 in 2007. Changes in the way the machines are designed have helped the country.

In the 1980s, when Cray Research CRAY +1.92% in Minneapolis was the world's supercomputer technology leader, the machines were powered by a few enormously powerful processors, whose design was difficult to match. Exports were tightly controlled. Starting in the 1990s, supercomputer researchers began to lash together tens of thousands of off-the-shelf microprocessors to work on a single job. China could buy those computer chips from Intel Corp., INTC -0.07% Advanced Micro Devices Inc. AMD +0.75% and other firms and make its own machines.

Analysts say that Chinese scientists have benefited from training at top computer centers in the U.S. and Europe and the availability of computer chips and other parts from abroad, as well as consistent Chinese government funding and support. The supercomputer effort isn't dogged by charges that the Chinese have ripped off foreign technology. Rather, Chinese scientists say U.S. restrictions on some high-technology exports have required them to redouble their domestic efforts.

Still, China remains largely dependent on U.S. made microprocessors—the brains of the computer—which puts it behind the leading edge. Beijing has developed one computer that uses locally designed microprocessors, but doesn't run commercially available software. Another microprocessor in development, the Loongson, would use existing software and could eventually become a competitor to Intel and others.

Some of China's supercomputers have been used to design wings for China's stealth fighter, now in test phase, and to design parts for China's first commercial jet. Beijing lags well behind the U.S. in both efforts.

In Shenzhen, the Nebulae, which is still being tested, is expected to improve storm warning systems and help genetics companies search for the causes of disease. But it is also scheduled to be used for far less demanding tasks, such as processing video animation.

In the U.S., said Steve Conway, a supercomputer analyst at market researcher IDC, in Framingham, Mass., cities and states chip in money for local supercomputer centers, but they generally have little say in setting the priorities for the machines. U.S. supercomputer centers nearly always focus on advanced scientific research, such as designing drugs tailored to individuals.

Research at the edge of technology is risky, but can have big payoffs and leave competitors like China well behind. "American alarmism isn't always well-founded," said Mr. Suttmeier, of the University of Oregon. "The critical point is keep devising strategies in the U.S. to stay way ahead of the game."

One of China's greatest weaknesses is in software development, a potentially crippling problem because the usefulness of the machines depends on the quality of the software applications.
Less than 10% of supercomputing funding goes to developing such applications, said Chinese researchers who complain that political leaders press them to build headline-grabbing new machines rather than focus on whether they are used to their full capabilities.

In the U.S., which spends about six times as much on supercomputers as China, the software budget equals about 30% of hardware spending, and computer specialists say even that level isn't sufficient.

The battle for software dollars is so intense in China that researchers rarely work as a team on long-term software projects, Chinese scientists say.

To illustrate the uneven perception of China's supercomputer efforts, Mr. Qian, the veteran supercomputer researcher, holds his palms at hip level. "Generally, we're here," he said, "but everyone thinks we're higher," as he raises his palms to shoulder height.
 

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Mar 21, 2012 Westinghouse Electric Company has announced that it has completed fabrication of all 157 fuel assemblies and related components needed to operate the first-ever AP1000 nuclear power plant, Sanmen Unit 1, in Zhejiang province, China.


Completion of fabrication is a major milestone for Westinghouse and its Columbia Fuel Fabrication Facility in Columbia, South Carolina, where the fuel assemblies were completed and delivered to the Sanmen Nuclear Power Company (also in Columbia) for later shipment to China. Sanmen Unit 1 is scheduled to begin generating electricity in 2013.

In commenting on the milestone, Ric Perez, President of Operations for Westinghouse, said: "This operational milestone, which closely follows final approval of the AP1000 design by the U.S. Nuclear Regulatory Commission and the granting of the Combined Construction and Operating License for the Vogtle site in Georgia, again shows that the global nuclear new build effort continues to gain momentum.

It also again illustrates that the Westinghouse business model is mutually beneficial, creating or sustaining jobs in locations in which we already have a presence while building infrastructure in the countries and regions where we are providing new plants."

Columbia Plant Manager David Precht said: "Up until now, the Columbia plant has been producing fuel primarily for the first generation of plants around the world,"

"But now we are introducing a new fleet of plants-AP1000 or 'Advanced Passive' plants-that will need fuel until late in the century. We look forward to also providing fuel for the AP1000 plants that will be built in the United States."

The AP1000 reactor, which received amended design certification from the U.S. Nuclear Regulatory Commission (NRC) in December 2011, was developed to further improve safety and reduce construction and operating costs. Westinghouse is pursuing production of AP1000 fuel across its global manufacturing facilities.

The "Advanced Passive" safety system is a central feature of the AP1000 design. Plant safety is achieved using basic physical processes rather than only powered safety systems. This approach means it can be safe without the extensive and complex emergency systems needed on other reactors.


The design uses natural cooling and gravity-driven systems to keep the reactor safe, even under the extreme conditions of a Fukushima-type event. The design also employs a more cost-efficient modular construction approach. The modules are built at remote factories and assembled together on site, reducing plant construction time. These concepts result in a simpler, more practical and safer design, which is attracting worldwide interest.

Sanmen 1 is the flagship AP1000 plant; seven more are already under construction: one more at Sanmen; two at Haiyang site in Shandong Province, China; two at Southern Nuclear's Vogtle site in Georgia; and two at the SCE and G V.C. Summer site in South Carolina. Additional AP1000 plants are anticipated over the next decade in the United States and around the world.

Westinghouse Electric Company, a group company of Toshiba Corporation (TKY:6502), is the world's pioneering nuclear energy company and is a leading supplier of nuclear plant products and technologies to utilities throughout the world.

Westinghouse supplied the world's first pressurized water reactor in 1957 in Shippingport, Pa. nowadays, Westinghouse technology is the basis for approximately one-half of the world's operating nuclear plants, including 60 percent of those in the United States
 

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It's the Wall Street Journal. They've won awards on that kind of coverage on China. Even the New York Times is following their lead out of envy.
 

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Chinese telecommunication giant Huawei was reported on Saturday to have been banned from tendering for Australia's National Broadband Network (NBN) contracts, with the office of Attorney-General Nicola Roxon issuing a statement saying the government needed to protect the integrity of Australia's information infrastructure.

The Australian Financial Review has quoted sources as saying that Huawei had been told last year not to bother tendering for any NBN related projects that aim to connect 93 percent of Australia's homes and businesses with optical fiber.

"As a strategic and significant government investment, we have a responsibility to do our utmost to protect its integrity and that of the information carried on it," the attorney-general's office wrote in a statement to ZDNet Australia...
 

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China is the coal capital of the world. With few of its own oil and gas resources, the nation depends on its vast coal reserves to literally fuel growth. Expanding in recent years at a rate of one new coal-fired power plant a week on average, the country's coal capacity is expected to triple that of the United States by 2015.

China's dependence on the dirty, sooty mineral, in turn, is a shot in the arm for cleaner, low-carbon coal technologies. As the world's leading carbon emitter, China has targeted energy and environmental conservation as one of its key growth industries in the 12th Five-year Plan.

Such technologies include carbon capture and storage, so that carbon emissions from coal-fired power plants are separated out and buried deep underground.

Good news

All this is good news for American companies involved in these technologies.

"US companies whose technology has been languishing here (in the US) for decades are commercializing for the first time because of the speed and lower cost of doing business in China," says John Thompson, director of the Coal Transition Project at the Clean Air Task Force, a Boston-based non-profit that brokers partnerships between US and Chinese clean technology companies.

Since the US and China generate half of the world's coal-fired power emissions, the two can make a big impact on the reduction of global greenhouse gas by working together. "Cooperation based on trust between US and Chinese businesses on the ground is the only pathway to a grand deal on climate change," says S. Julio Friedmann, carbon management program leader at the US Department of Energy's Lawrence Livermore National Laboratory in California.

They couldn't be better suited for such cooperation given their complementary capabilities: While China focuses on technology to separate carbon emissions from coal exhaust, the US is an expert in technology to store that carbon underground.

Terry Cooke, a senior fellow at Penn's T.C. Chan Center for Building Simulation and Energy Studies, calls it "a win-win opportunity to create a 21st-century globalized, accelerated technology development loop where the US supplies what it does best, which is innovation, and the Chinese bring advantages of speed and scale of deployment."

Speed to market is the biggest attraction for Western companies flocking to China. "China can deploy technology roughly twice as fast" as the US, says Frank Alix, CEO of PowerSpan, a New Hampshire-based company working with state-owned China Huaneng Group on a new coal gasification solution.

"The US may have innovation and new ideas, but it takes five to 10 years to get to full commercialization with lots of cost in between. China can do it in a much shorter time and much cheaper," adds Ming Sung, chief representative of the Asia-Pacific region at the Clean Air Task Force in Shanghai.

Part of the speed comes from having access to state-backed capital in China. The cost of capital in the US - at roughly three to five times that in China- factors in longer lead times right from the start.

To justify a hefty US$1 billion investment in a new US coal plant, for example, preliminary engineering studies are lengthier and therefore more costly than those in China, comments Robert Rigdon, CEO of Texas-based Synthesis Energy Systems (SES). "In China, almost every project you enter gets built," he says. "In the US, it's almost the opposite."

Whether foreign or Chinese, one invaluable benefit gained from the on-the-ground experience in China is that companies are getting a better grip on management, forecasting and efficiency both in their plants and up and down supply chains.

"There are a massive number of players in the industry in China experimenting and improving themselves on a daily basis to create a level of know-how to accurately project cost and to let them figure how much steel and concrete to use," says Jason Crew, general manager of General Electric Gasification in Shanghai.

Better Together


For all these reasons, Rigdon found China a hospitable market for technology developed in the 1970s by the Gas Technology Institute in Illinois. SES is the exclusive licensor of that coal gasification technology called U-GAS and saw big opportunities in China because of the country's "large amounts of coal converted to energy and chemicals," says Rigdon.

In 2007, SES launched a joint venture in Zaozhuang in Shandong Province with Shandong Hai Hua Coal & Chemical Co to convert low-quality coal into clean synthetic gas before it is deployed for industrial uses. The US firm is now engaged in a US$4 billion project in Henan Province, which will be completed this summer.

In a partnership with Yima Coal Industry Group, the project aims to convert low-quality coal into clean synthetic gas for conversion to methanol or glycol for industrial uses. Longer term, U-GAS can be used to extract CO2 from coal-generated power plants, which can be stored underground.

PowerSpan is also getting a lift from China. The small clean energy company developed an advanced solvent to remove CO2 from the exhaust of coal-fired power plants. The solvent binds with the CO2, which is then separated for capture and storage. With the help of China Huaneng Group, PowerSpan won a contract last year with Norway's Technology Qualification Program to build out a post-combustion capture system. Now, the two firms are exploring other projects together in China.

Meanwhile, US-educated Chinese scientists, who started low-carbon coal and related research projects in the US, are taking these ventures to China. Jane Chuan - a China-born scientist with a PhD in bioenergetics from State University of New York at Buffalo - and her husband-- a China-born scientist PhD in chemistry from Cal Tech - helped launch a Silicon Valley firm in 1996, applying a method developed for the biopharmaceuticals market to energy efficiency solutions. When the company's board grew too concerned about intellectual property (IP) theft to begin their operations into China, Chuan and Wang set up Accelergy, a company focused on accelerated energy technology, in Palo Alto in 2003. They subsequently moved to Shanghai, renaming their venture Yashen Technologies.

Closer to the market


In China, "energy and environmental protection will become huge issues," says Chuan. "We could have chosen to go to Russia, India, Cambodia or some other place where labor costs are even lower, like Vietnam, but here, we are closer to the market."

A top-quality labor pool in Shanghai helps Yashen build and operate high throughput systems. "To develop a new application or technology may take about 15 to 20 years in the US. With the high throughput platforms we build, we spend about five years."

Penn's Cooke notes that a key to making these US-China partnerships work is that "US companies have to be sure of their intellectual property protection and commercialization benefits." Yet as opposed to other clean tech industries in China, such as wind energy, low-carbon coal technology companies seem relatively relaxed about IP theft by Chinese customers and competitors. Some experts say one reason is that upholding the standard 20-year US patents is less of a concern in large-scale energy technologies, such as carbon capture, because plants operate on multi-decade timetables.

Unlike in, say, software, music or fashion, "there's less copying in this industry, because the projects are large," says Albert Lin, CEO of Calgary, Canada-based EmberClear Corp, which is the exclusive licensor of Huaneng's technology in North America and other regions." People are more worried whether you have the R&D efforts to sustain and improve plants that will run for 40 years," he says.

What's more, large Chinese companies are gaining ground by exporting some of their technologies to other emerging countries. Huaneng, for instance, is starting to sell a technology, known as circulating fluidized bed (CFB), to convert coal to cleaner energy. "Many Chinese plants built in the last five years have used proven CFB technology," says Lin. "Now, there is a lot of interest from developing countries where cost is important."
 
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