By targeting China, US heightens risk of another cold war
- Donald Trump says he is trying to create a fair playing field, but his actions against Huawei and other tech giants can also be seen as a way to crush competition and debase globalisation
The Trump administration claims its trade war with China is about creating a fair playing field for doing business. Its bans against Chinese technology firms, equipment and products seemingly point to a different goal. Further reforms are sought from Beijing to widen market access for American companies and exports. But targeting Huawei and other tech giants can also be viewed as being about crushing competition and debasing globalisation.
Huawei is a world leader in telecoms able to provide technologically advanced and cost-effective next-generation 5G networks and equipment, and it is the second-biggest producer of smartphones with an eye on ousting Samsung as the front-runner next year. SZ DJI is the world’s largest manufacturer of consumer drones in a fast-growing global sector. Making unproven accusations and cutting supply chains can impact the global growth of such firms. But the targeting of Chinese firms will also prompt them to strive to take control of all aspects of production, robbing US suppliers of business, while imposing bans denies choice for consumers.
Isolating markets is a regressive approach to economic and technological development. It also hampers China’s reforms; Huawei and other private companies with global ambitions have been champions of the country’s wider opening up, but the US actions are punishing them. Targeting China in such a way is also giving greater voice to nationalists, raising the spectre of even deeper divisions between China and the US and heightening the risk of a new cold war.