IELTS Academic Reading Passage
Business Innovation and International Competition
Business innovation is not limited to rivalry between firms—it also flourishes when nations compete. Global competition between countries drives innovation by encouraging investment, talent development, and strategic policymaking. The technological and green energy sectors reveal how such competition can lead to breakthroughs.
A notable example is the ongoing rivalry between the United States and China, especially in emerging technologies such as artificial intelligence (AI), semiconductors, and 5G. The U.S. has traditionally been a leader in tech innovation, backed by agencies like DARPA, which has supported developments in GPS, the internet, and AI. The U.S. also benefits from a robust venture capital ecosystem, which enables rapid commercialization of research.
China, in contrast, adopted a state-led model through initiatives such as “Made in China 2025”, aiming to dominate advanced manufacturing and high-tech sectors. By offering extensive state subsidies and backing firms like Huawei and SenseTime, China has significantly advanced in 5G and AI development. In fact, China accounted for more than 60% of global AI patent filings in 2020.
This competition has led to a global innovation race. For instance, Huawei’s rapid 5G rollout pushed U.S. firms like Qualcomm to expedite their own R&D efforts. A similar pattern is evident in the green energy sector, particularly in solar power and electric vehicles (EVs). China has become the largest producer of solar panels and EV batteries, thanks to heavy investment and policy support. Firms like CATL and BYD now supply much of the global EV market.
The U.S., in response, passed the Inflation Reduction Act (2022), committing over $369 billion to domestic green innovation. This has strengthened companies like Tesla, which has emerged as a leader in the global EV industry.
Despite different approaches—market-driven in the U.S. versus policy-driven in China—both countries have accelerated their innovation to maintain competitive advantage. However, each model faces its own challenges: the U.S. is often slower in implementation due to regulatory barriers, while China continues to face concerns over intellectual property (IP) protection.
In conclusion, the U.S.-China rivalry shows how competition between nations can accelerate innovation and reshape global industries. Rather than divide, competition drives transformation and fuels technological advancement.
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